Coupa -- a highly focused On-Demand eProcurement vendor that is very easy to root for thanks to its creative marketing, solid basic functional capabilities, and reasonable price points -- just announced that it turned in a respectable overall performance for 2009 in terms of revenue and customers. It's important to note, however (based on numbers that I'll share in a minute), that thanks in large part to low prices, Coupa's revenue before 2009 had been dismal relative to its overall customer acquisition and related metrics. This nearly doomed the vendor, which would have been horrible for the market; fortunately, thanks to successful investments, sales, and marketing -- not to mention price increases -- Coupa appears to have righted its yawing revenue ship.
According to its announcement, Coupa delivered a "270% increase in recurring software revenue in 2009" with "sequential growth of new bookings each quarter." The vendor "nearly tripled [the] number of organizations procuring goods and services through [its solutions] ... soaring well past the 100-customer milestone." Moreover, Coupa saw a tenfold increase in volume through its E-Procurement system, and maintained a solid renewal rate of 96%. What's most interesting to me, however, as I read into the announcement, is that Coupa seems to have been attempting to move upmarket into Ariba territory, capturing a number of larger names that originally would not have fit into its SMB focus. Among the larger middle-market and enterprise-size companies in which it captured 2009 customers are: Chubb Insurance, Tesco, The South Financial Group, Flextronics, and Taleo.
Going into 2010, I remain optimistic that Coupa will have another solid year. Although it has quite a bit of work to do in product development to release solutions that not only provide eye-candy usability but that also approach P2P functional leaders like Ariba in depth and breadth, Coupa is developing on a platform that should allow it to rapidly translate enhanced product specifications or market requirements documents (MRDs) into product. More important, Coupa has proven to me that they're now a secure player to recommend in the space, having shored up its top line to a point where it has a fighting chance to remain a contender as an independent provider.
Bottom line: if you're a company with <$3 billion in annual revenue and you're willing to work with a smaller provider, you owe it to yourself to put Coupa on a longer eProcurement shortlist. (If you're <$1 billion in revenue, don't even stop to think about it -- check out Coupa as early as possible in your vendor analysis.)