Stepping Away from SAP/Ariba Uncertainty, Hubwoo Moves Its Network Vision Forward (Part 5)

Please click here for Part 1, Part 2, Part 3, and Part 4 of this series.

In the earlier posts in this series, we examined Hubwoo's recent product enhancements and solution roadmap – as well as the current capital market situation they find themselves in following SAP's planned acquisition of Ariba. To summarize the last post, it's our belief that given Hubwoo's current valuation (at the time of a recent Spend Matters PRO article: How Has the SAP/Ariba Deal Affected Other Firms' Stock Prices?), that the SAP procurement BPO and network partner is likely to be acquired. There are many potential suitors who could either:

  • Do a revenue arbitrage of Hubwoo's potential higher valuation network volume and SAP-focused revenue (not the legacy business revenue, which continues to decline) and either keep Hubwoo's solutions or migrate customers onto their own. This might be attractive to organizations such as Basware, TradeShift, IBX/Capgemini, Infosys and others in the e-invoicing sector
  • Use the Hubwoo customer base and SAP relationship (as long as it continues throughout the length of the BPO agreement) as a means to up-sell other solutions (owned by a potential acquirer). This option may be attractive to offshore BPO firms with existing SAP partnerships
  • Take Hubwoo's solutions into their own customer base as an up-sell opportunity. This option may be attractive to offshore BPOs as well

Simply put, at current valuation levels, it's our hypothesis and opinion that the Hubwoo asset, even if it has a finite lifespan left until the privileged relationship with SAP ceases to be as privileged at some point in the future, is unlikely to stay independent for the next six months. Fortunately, if Hubwoo does become part of another organization, the ultimate suitor will also find itself not just with a specialized set of solutions to surround SAP procurement initiatives, but also a highly commercially oriented and talented team that knows a thing or two about selling into SAP-centric procurement organizations.

Does anyone else have a different opinion than us on the subject of what will happen to Hubwoo?

Our Hubwoo coverage will continue – expect more articles toward the end of September.

- Jason Busch and Thomas Kase

Voices (4)

  1. George:

    That’s a good question… i think just now when the acquisition finalized its that the opportunities will start to show up. I still don understand why SAP doesn’t acquire Hubwoo, its cheap and seems to have a good customer base who also are SAP’s customers. They would keep this customer base by keeping Hubwoo part of the SAP family.

    One day SAP says go with Hubwoo our supplier network partner the best etc…and the next day its a go with Ariba story, not very credible if you ask me.

  2. Jeff Adams:

    Which offshore BPOs do you feel would be most interested in Hubwoo .

  3. Jason Busch:

    This is a quiet crowd … each of the posts in the series has gotten between 750-1150 people views (not bots) so far, based on when it was published (higher views for the earlier posts in the series). I think a lack of comments is based on when it started (August) and a relatively slow traffic period in general for the site around the back-to-work timeframe. Good question.

  4. Mr Supplier Network:

    Although I think Hubwoo has a great product and that the new events will make it get better as they are forced out of their comfort zone I am intrigued on why there are no comments at all in any of the 5 posts, do people care? is anybody reading them? is this a topic hot in the market? I don’t have access to see how many hits these articles get.

    I just thought this would pick more interest.

    any insight would be appreciated.

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