[COUP – Coupa Software] Savings-as-a-Service
You’re a middle manager at the branch office of a vast multinational. And you need an armful of binders for your team. Would it occur to you that a procurement manager at HQ has negotiated discounted rates through Office Max? Even if it did, would you know how to order against that contract? Do you care? Trivial individual purchases can sum to meaningful amounts. Ideally, disconnected strands of spending would gather in a single, easily accessible and searchable place. Most of that spend would draw against contracts struck at favorable rates with preferred suppliers; more of it would go through pre-approval and less of it reimbursed after the fact.
Software vendors have addressed various aspects of renegade spend since the 1990s. Two of the bigger players of that time, Ariba (procurement) and Concur (expense), were bought by SAP in 2012 and 2014, respectively. Coupa was a relative latecomer, launching in 2008 with the conceit that, unlike Ariba and Concur – which were sold as distinct products and which, despite being refashioned for cloud delivery, still retained their on-premise stink – its solutions were cloud native and pre-integrated, with procurement, expense, and invoice stitched together as part of a single platform, built on a single codeline1.
Having all these modules together in one place on a common interface offers comprehensive purview of the various types of regular and ad hoc spend throughout the organization: power users in finance and procurement departments can be notified when there’s an unusual amount of off-contract spend; or when volumes with a given supplier reach a level where the company might be able to negotiate a better rate; or, if ERP is integrated, when a floor manager is about to place an order for an item already held in inventory. For non-specialist users – those who don’t concern themselves day-to-day with cost control – staying compliant with spend policies needs to be as easy as possible, helped along by a system that, for instance, extracts relevant information from a receipt photo and auto-populate an electronic expense form, or shoots off an alert when an impending purchase is about to breach a budgetary constraint.
Coupa perhaps commands more mindshare in the spend management space than its current revenue justifies, aided in no small part by a management team that regularly forces a wedge between itself and SAP, often boasting, as any challenger might, that it is so far ahead of the game that the only real competition it faces is itself. As a sprawling software complex with €30bn+ in revenue, SAP is not going to devote time rebutting the claims of a $240mn revenue competitor.