Online billing company Aria Systems gets funding from industry vet

Aria Systems, a startup that provides software to handle online billing and subscriptions, just received an undisclosed investment from one of the early innovators in the field.

Dave Labuda, who is also joining Aria’s board, may not be familiar to most of our readers, but he co-founded market leader Portal Software, which has since been acquired by Oracle. In describing his excitement about the deal, Aria chief executive Edward Sullivan used a rather impressive sports metaphor.

“Dave is the Michael Jordan of billing, and we’ve got him on our team,” Sullivan says.

As with other companies that deliver their product through the software-as-a-service (SaaS) model, Sullivan says Aria offers substantial savings over the traditional competition — because it doesn’t require on-site hardware or installation, he estimates Aria costs 60 to 70 percent less than older billing companies that do, like Portal. There have been some technical challenges and security concerns in “crossing the SaaS chasm”, he says, because recurring subscriptions are much more difficult to manage than one-time purchases. But the market is heating up now, with OpSource’s acquisition of billing startup LeCayla in February, and Benchmark Capital’s $6.5 million investment in Zuora.

But Sullivan says Aria was the “first mover” in the market. It launched more than three years ago, and manages subscriptions in 236 countries, including Antarctica. That gives it a pretty big head start over competitors like Zuora, which just launched in March.

Last year, Aria raised a $4 million first round from Hummer Winblad.