Beeline / IQN Merger Progress: Exclusive Interview With Doug Leeby

It is almost 3 months since two of the three biggest providers of VMS software (used to manage contingent labour and related complex service spend areas) merged. GTCR, a Chicago-based private equity firm and owner of IQNavigator (IQN), acquired Beeline from Adecco to form a business that vies with Fieldglass – now part of SAP – for overall market leadership in this sector.

Now Jason Busch, founder of Spend Matters US has conducted an extensive interview with Doug Leeby, the CEO of the new business. In the interview, published now at Spend Matters US, they cover issues such as what it is like to be owned by a private equity firm, and how customers have taken to the news of the merger. As Leeby says:

Since the merger was announced my executive team and I have been on the road visiting with customers and partners. I’ve already met with 25 IQN and Beeline customers in person with 20 more planned in the next few weeks. It is really important to me to connect directly with customers of both of our VMS platforms as they are critical to our success … The reaction has been positive. Our customers and partners see the obvious value in combining our two organizations but also have loudly told us that they don’t want to be forgotten along the way”.

He talks about the effect on the market, which now has two giant players and then a big gap to a range of other solutions providers. There is also the sensitive issue of rationalisation within the new firm, and consequent headcount reduction, which was inevitable really given the nature of the two firms. That was “less than 10% of our combined workforce” explains Leeby but it is painful nonetheless for a business with an “employee-centric culture”.

Perhaps the most critical questions for existing customers though are around the future of the two platforms. Leeby is very direct on this.

…. let me be very clear on the platform question.  Despite rumours to the contrary, we are not retiring either VMS platform…  Together, we have about 300 customers with approximately 150 on each platform. Frankly, it would be both inane and irresponsible to sunset one of the VMS platforms.  I think people assume Private Equity is all about “the quick buck”.  Supporting two platforms isn’t efficient but in this case, it is mandatory”.

I rather like the “inane and irresponsible” phrase; must use that somewhere ourselves! But Leeby goes on to say that the “Quick Wins” initiative will mean some new enhancements for all customers; “sharing great IQN functionality with Beeline customers and doing the same with Beeline functionality for IQN customers”.

The full interview is well worth reading for customers of both firms and anyone else interested in the VMS and contingent labour markets. You can read part 1 here and part 2 here.

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