Markus Ament (Maex), Chief Product Officer at Taulia, sat down virtually with the Spend Matters team to answer some questions we had for him on Taulia, dynamic discounting, and the future of trade financing. Read between the lines as you see what Maex has to say – Taulia is doing exceptionally well right now in the field and the Taulia philosophy is one that is being mirrored by many AP, procurement and treasury heads we speak with. If you missed the previous installments, here are Part 1 and Part 2.
Spend Matters: How does Taulia's approach to discounting and e-invoicing differ from others?
Maex: One main differentiator for Taulia is that our solution is completely and 100% free for suppliers. There are no crazy network fees, hidden transaction costs, setup fees, annual supplier subscription, taxes - nothing. Contrary to popular opinion, you can build a very successful business without charging suppliers. Without fees, suppliers adopt the solution much more willingly and use it more often. When providers charge fees to suppliers, they ultimately have to find a way to recoup those costs, which more often than not comes in the form of raising prices for their customers to make up for the “tax” (i.e.. transaction fee) for doing business with them.
Another one of our strengths is that we provide a truly global and comprehensive solution - from compliance to support to product offerings. We ensure that no matter where suppliers are located, their technological know-how or which method of invoicing they use (we offer free-form submission, eFile, flipping POs, uploading, email or PDF processing), they can utilize and reap the benefits of our solution. We designed the Taulia platform with both usability and user experience in mind and set out to make a solution that not only was simple and intuitive, but also attractive in look and feel.
When it comes to discounting, we’ve kept our approach relatively the same and focused on providing a supplier financing solution that was simple yet powerful and addressed the entire spend of all suppliers. This was an absolute requirement for our team because in order to fully achieve the benefits of Dynamic Discounting, all invoices need to be available for acceleration- regardless of whether or not the invoice was submitted through the portal.
Spend Matters: Could you provide some more insight into your trade credit and financing philosophy and direction, and more importantly, how it fits into a broader receivables financing (and supply chain finance) context?
Maex: As I said previously, Taulia was founded as a traditional buyer-funded Dynamic Discounting provider. We soon found ourselves being compared to conventional supply chain finance providers and our Dynamic Discounting being named as a competitive solution - which it isn’t. There are certain situations (think size of the supplier!) that make sense for deploying a supply chain finance program and others that make sense for deploying Dynamic Discounting - they can (and should) perfectly co-exist. This is why we partner with major banks, such as CitiBank, to combine the two offerings.
In addition, with the launch of our new financing option next month, we’ll offer another solution that can co-exist with traditional supply chain finance and Dynamic Discounting or be offered as a single supplier financing option.
Spend Matters: Where is Taulia headed next from a product perspective?
Maex: Taulia began as a Dynamic Discounting solution, but really was just the beginning. Since our early days, we added electronic invoicing, a SIM module, PO delivery, confirmations and ASNs. We’ve recently built out a data analytics team to provide our buyers with uber-customized business cases that maximize supplier discount capture. We’ve partnered with large banks to offer supply chain finance through an integrated platform. And we’re working on a new flavor of discounting that is huge and that we believe will completely revolutionize the supplier financing landscape.
A big part of our product focus in 2013 was to expand our capabilities beyond SAP to become available to any buying organization, regardless of their ERP system. We are now shifting that same focus towards Accounts Receivable, enabling the Taulia platform to integrate into every supplier’s AR billing system. This is great because not only does it scale the depth of penetration into the buyer side of things, but also the supplier side.
Another priority is to provide our customers with additional value by introducing another way to use our product through mobile devices. Our solutions already operate on all mobile browsers, but we plan on expanding mobile capabilities with apps that allow suppliers to take advantage of all of our portal features on the go - snapping a picture of an invoice and submitting it to their buyer, sending message inquiries on invoices, accepting an early payment discounting, etc. We see this greatly increasing activity levels of some of the smaller suppliers who are often on the go, without access to a desktop computer.
Spend Matters: How much does Taulia (and your competitors) owe to the legacy of Xign in creating this market?
Maex: Full credit should be awarded to Tom Glassanos (together with some of his first customers, as I understand), who invented Dynamic Discounting. He was incredibly successful in introducing the concept, finding first believers and turning them into highly successful customers. Unfortunately, when J.P. Morgan acquired the company, the innovation stopped, supplier fees got introduced and the product lost its luster. And now, with J.P. Morgan’s recent announcement, I believe we have to thank them for the second time!
We’re close with Tom. Without his innovation, Taulia wouldn’t exist. It’s that simple.
If you’re curious about dynamic discounting and the broader world of trade financing, we encourage you to check out our latest site, Trade Financing Matters, and a recent Spend Matters PRO research brief exploring all sides of the dynamic discounting opportunity.