How HighRadius Improved Their Cloud Efficiency Rate By 5% With CloudZero

The Challenge

A sterling review from Gartner. 40–45% year-over-year growth. Things seemingly couldn’t have been going better for HighRadius — but behind the scenes, they faced a troubling situation. While HighRadius had been revolutionizing the office of the CFO — providing automated solutions for enterprise-grade customers that substantially reduce the risk and time spent on manual tasks — their cloud spend had been mounting exponentially.

“Our cost metric is cloud cost as a percentage of revenue,” said Simran Singh, HighRadius’s Assistant Vice President of Cloud Engineering. “It had been 4–5%, then very quickly it jumped to 7%, then 9%, and it hit its worst at 11% last year, just before we deployed CloudZero. It was on pace to hit 13% by year-end.”

Simran and his team had begun scrutinizing their COGS and R&D OpEx with the goal of getting their costs under control, but were repeatedly hamstrung by a lack of visibility. Multiple products, customers, and environments sharing the same resources meant it was impossible to assign costs to the correct drivers and therefore, impossible to design initiatives that nipped the cost spikes in the bud.

Low shared resource visibility was just one of their issues. HighRadius uses a multi-cloud approach, including AWS, Azure, and GCP, and also leans heavily on Kubernetes. Multiple different data formats coming in from these providers made it impossible to unify their costs in a single pane of glass.

The upside for Simran and HighRadius of getting their costs under control was great — as was the downside if they couldn’t. HighRadius needed a cost management platform that could:

The Solution

HighRadius approached CloudZero, the next-generation cloud cost management platform that helps engineers build cost-efficient software without slowing down innovation.

Their cloud cost challenges were familiar to CloudZero, which specializes in turning complete visibility into engineering-led savings. CloudZero’s first step was to ingest 100% of their cloud costs and normalize them in a common data format — a cinch for AnyCost™.

Then, CloudZero allocated this data according to the business framework that mattered to HighRadius. With multiple products, environments, and customers using the same cloud resources, they needed cost per product, cost per environment, and cost per customer to understand which costs to attribute to which drivers — and by extension, how to optimize it.

During the proof of value (POV) process alone, CloudZero gave HighRadius cost per product and cost per environment. Impressed with the speed and accuracy of allocation — as well as the savings initiatives it enabled — HighRadius became a CloudZero customer, trusting that cost per customer would be just as simple for the platform to deliver.

Visibility was a crucial first step. But there was still the question of helping HighRadius navigate their business challenges. Across the course of HighRadius’s CloudZero customer journey, the results have been deep and lasting.

The Results

Reduced cloud cost as a percentage of revenue by 5% against projections

HighRadius’s cloud cost as a percentage of revenue was trending toward 13% before they deployed CloudZero. At the time of writing, it has fallen to 8%. “We’re expecting it to get down to 6.5%,” Simran said.

How did they do it? Simply by connecting visibility to savings initiatives. From the jump, the visibility CloudZero provided enabled them to control cost “leakages” — simple engineering errors it’s easy to make and forget about when innovating quickly.

“One engineer built something where EBS volumes were being generated but not deleted,” Simran said. “This increased costs exponentially until CloudZero illuminated these mistakes, showed them to the relevant engineers, and enabled quick fixes that didn’t hurt our speed of innovation.”

CloudZero’s metric to describe this phenomenon is Cloud Efficiency Rate (CER), which assesses how much revenue a company keeps vs. how much they give back to cloud providers. In these terms, HighRadius’s CER improved from a projected 87% to 92%, on track to 93.5%, as a result of their work with CloudZero. For reference, the healthiest SaaS companies have CERs of 90%+.

A single pane of glass for all cloud stakeholders

Most importantly, HighRadius has seen widespread adoption of CloudZero among their engineers.

“We’re very happy with the adoption,” said Tanuj Vohra, HighRadius’s CTO. “Our engineers are using it to go in, monitor their costs, do some fine-tuning, and see some quick wins with cost.”

This positive feedback loop is very important for their engineers, who previously got jaded after not seeing results from cost optimization initiatives. Now, with the ability to design targeted initiatives and track the results in CloudZero, “it helps us to be frugal and not cheap — and we get jazzed up for the next sprint,” as Simran put it.

CloudZero uptake has expanded beyond HighRadius’s engineering organization. Simran led a session with their finance team, who “loved the platform,” and is continually bringing more and more folks in from across HighRadius’s departments.

“It’s no exaggeration to say that every team is looking at CloudZero today,” Simran said.

A dedicated FinOps partnership

At the root of the value HighRadius gets from CloudZero is a strong FinOps partnership. Every cloud environment is different; thus, CloudZero prioritizes a custom approach for each customer, merging art and science to mold a cost optimization framework reflective of each customer’s business.

“CloudZero is very keen to customize based on our business needs,” Simran said. “They’ve given us query-level visibility across all our products — very specific to our business use case.”