Initial product integration between the two companies will focus on delivering a single sign-on component in the areas of sourcing and supplier management. Spend Matters expects tighter product and workflow integration (e.g., P2P permissions/controls linked with supplier management alerts and status) overtime and expects to learn more coming out of SciQuest's Next Level event in February. As part of its roadmap, we expect SciQuest to focus on multiple aspects of the AECsoft business, including building out a more tightly integrated and feature-rich sourcing capability. Yet today, AECSoft still serves to fill important product voids in multiple areas -- not just supplier diversity and management. In this regard, SciQuest management notes, "we bought the business because of all of its parts."
In terms of sector and customer overlap, SciQuest views its ability to capitalize on AECsoft's complementary existing customer footprint in verticals like life science as a key potential rationale for the strategic move. In addition, AECSoft brings customers in other verticals, including higher education and the public sector, which will present SciQuest with additional up-sell capability. However, Spend Matters believes that the significant delta between average deal/customer relationship sizes between the organizations (typically low-mid five figures for AECsoft and six figures for SciQuest) could cause some minor friction in expanding on existing AECsoft relationships that may have been sold at a lower internal level and/or to more cost and value conscience customers in the past.
Stay tuned as we continue to cover the post-acquisition news and integration plans in the coming quarter.
- Jason Busch