The Coupa timeline – From foundation to Thoma Bravo, analysis and breakdown

On December 12, 2022, Coupa announced that it had entered into an agreement with Thoma Bravo to be acquired. This article serves to take a high-level look back at Coupa’s life as a company thus far, as well as to provide a brief analysis of its time as a public company. For more extensive detail about Coupa and its offerings, refer to previous Coupa coverage on SpendMatters.

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Timeline

2006 — Coupa is founded by Dave Stephens and Noah Eisner as an e-procurement application. The founders’ goal is to offer open-source solutions, as noted in one of SpendMatters’ early articles Coupa Cabana. At the time of its launch, it was self-funded by the founders.

2007 — March: Coupa officially launches its product in the US. It is initially free and downloadable, but Coupa makes it clear that a paid, enterprise version is forthcoming.

2007 — October: Coupa launches its paid e-procurement offering. As SpendMatters coverage noted at the time in Coupa shakes up market: On-demand Procure-to-Pay for all, the offering was initially much more affordable than its peers.

2009 — February: Dave Stephens (Coupa co-founder) steps aside as CEO for Rob Bernshteyn.

2009 — September: Coupa receives $7.5 million in funding.

2010 — February: Coupa releases expense reporting capabilities, including an integrated system that captures all non-payroll spend. This was the beginning of its T&E functionalities, which led to a full T&E suite in 2022.

2010 — December: Coupa partners with Emptoris to provide an end-to-end Procure-to-Pay and Contract Management solution for Rent-A-Center.

2011 — May: Coupa releases more robust spend management capabilities, including an RFP/RFI engine, as noted in New Coupa Release part 1, part 2 and part 3.

2011 — September: Coupa expands into Europe, hiring Alex Kleiner as VP of sales for the region.

2011 — November: Coupa launches its Spend Optimizer, a tool designed to analyze and provide insight into spend data, as we initially covered in A P2P vendor crosses the analytics line: Coupa ventures into spend analysis.

2011 — Coupa reports an impressive year, claiming a >120% increase in revenue and 100% increase in employee count.

2012 — May: Coupa announces that it raised $22 million in its latest round of funding. It also announced its plans to expand into contract management, a supplier network and further analytics as we noted in Coupa adds $22 million to War Chest part 1 and part 2.

2012 — August: Coupa announces contract visibility and e-invoicing will be in its newest release.

2012 — December: Coupa partners with OB10 for e-invoicing and accounts payable capabilities.

2012 — Coupa reports continued growth year-over-year, as noted in Coupa – Spend management/eProcurement tech firm sees momentum continue. Additionally, it is named “The Next Big Thing” by the Wall Street Journal and ranks #115 on Deloitte’s Technology Fast 500 list.

2013 — April: Coupa acquires Xpenser, an independent T&E vendor with particular expertise in the mobile information capture of expenses.

2013 — August: Coupa launches version 10 of its suite which features a new sourcing module, which we wrote about here Coupa 10 Launches.

2013 — Coupa reports that it grew 100% year-over-year, expanded its partnerships considerably, and expanded further into Europe and Latin America.

2014 — March: Coupa raises $40 million USD in its latest funding round.

2014 — April: Coupa partners with Alibaba.com in an effort to expand its supplier network and DocuSign to provide integrated digital signing capability with its own set of applications.

2014 — June: Coupa launches its inventory management module as an extension to Coupa’s core P2P capabilities.

2015 — February: Coupa acquires ZenPurchase to enhance the suite’s collaboration capabilities.

2015 — May: Coupa raises $80 million in its latest funding round, bringing total capital raised to over $1 billion.

2015 — June: Coupa announces a Supplier Information Management (SIM) module.

2015 — July: Coupa acquires InvoiceSmash to expand Coupa’s invoicing solution and TripScanner to expand its T&E offering.

2016 — January: Coupa acquires Contractually to improve contract processes through better internal and supplier authoring collaboration.

2016 — October: Coupa goes public, opening at $18 a share, and has a successful first few days of trading, climbing to $39 a share at one point as we note in Coupa IPO pops on opening: What do we think? and Super Coupa, Nasdaq launch is crazy. It ends its first week as a public company valued about $1.4 billion.

2017 — January: Coupa acquires Spend360, a best-in-class spend classification vendor, which added AI and ML spend-data classification capabilities.

2017 — January: According to Coupa’s investment report, for the fiscal year ending on the 31st of January, annual revenue increased 60%, or $133.8 million, and GAAP operating loss was $35.4 million. Operating cash flow was positive $21 million.

2017 — May: Coupa acquires Trade Extensions, a specialist e-sourcing and strategic sourcing optimization vendor, which we discussed in Coupa enters an agreement to buy Trade Extensions: A game changing move for strategic sourcing and gave a solution and market analysis. It also launches Coupa Payments, a cloud e-payables solution designed to streamline cross-border payment systems and automate accounts payable processes. Then it partners with Amazon Business to launch Coupa Open Buy, which allows Coupa customers to shop beyond managed catalogs using an embedded Amazon Business marketplace within the Coupa solution.

2017 — November: Coupa lists its procure-to-pay and expense management modules on the AWS marketplace to target small and medium sized businesses, Coupa opens new middle-market front with P2P, T&E packages on AWS Marketplace.

2017 — December: Coupa acquires Simeno, a P2P provider that specializes in catalog search and management with a foot in the European market.

2018 — January: According to Coupa’s investment report, for the fiscal year ending on the 31st of January, annual revenue increased 40%, or $186.8 million and GAAP operating loss was $45 million. Operating cash flow was positive $19.8 million.

2018 — January: Coupa releases Services Maestro, its complex services procurement solution.

2018 — September: Coupa acquires DCR Workforce, a leading provider of contingent workforce/services (CW/S) procurement software.

2018 — October: Coupa buys Acquiire, a provider of e-procurement software, that brings notable capabilities in real-time search and catalog management. Additionally, it partners with Apptio to give a more complete picture of a company’s full technology spend.

2018 — December: Coupa buys Hiperos to add compliance and risk management capabilities to its suite of offerings as covered in Coupa buying Hiperos — Adding compliance and risk intelligence prowess to Its Business Spend Management insight and with acquisition facts and insight here.

2019 — January: According to Coupa’s investment report, for the fiscal year ending on the 31st of January, annual revenue increased 39%, or $260.4 million, and GAAP operating loss was $47.4 million. Operating cash flow was positive $37.4 million.

2019 — May: Coupa acquires Exari, a CLM solution provider.

2019 — June: Coupa expands its partnership with AWS to help enterprises with technology spend and partners with Paypal, Stripe and Citi Commercial Cards to bolster Coupa Pay.

2020 — January: According to Coupa’s investment report, for the fiscal year ending on the 31st of January, annual revenue increased 50%, or $389.7 million, and GAAP operating loss was $73.4 million. Operating cash flow was positive $68.2 million.

2020 — January: Coupa acquires Yapta, a solution provider that enables businesses to automatically monitor and re-book air and hotel reservations when prices drop.

2020 — May: Coupa acquires ConnXus, a supplier diversity specialist.

2020 — June: Coupa acquires BELLIN, targeting independent treasury management.

2020 — July: Coupa stock (COUP) crosses $300/share mark.

2020 — October: Coupa launches the Coupa Inclusion Initiative, aimed at helping organizations use more inclusive and diverse suppliers.

2020 — November: Coupa acquires LLamasoft, a supply chain planning, monitoring and analytics company.

2021 — January: According to Coupa’s investment report, for the fiscal year ending on the 31st of January, annual revenue increased 39%, or $541.6 million, and GAAP operating loss was $95.4 million. Operating cash flow was positive $78.2 million.

2021 — February: On the 19th, Coupa stock (COUP) reaches all-time high of $377.04/share.

2021 — March: Coupa acquires Pana, a travel booking technology company.

2021 — June: Coupa launches a venture capital fund, Coupa Ventures and a Sustainable Business Spend Management offering aimed at helping companies with ESG efforts, covered here.

2021 — August: Coupa launches an app marketplace that lets its customers connect to curated third-party partner solutions and to see that data in the Coupa system.

2022 — January: According to Coupa’s investment report, for the fiscal year ending on the 31st of January, annual revenue increased 34%, or $725.3 million, and GAAP operating loss was $244.1 million. Operating cash flow was positive $168.1 million.

2022 — February: Coupa launches a full T&E suite, which we covered in Coupa launches unified travel-and-expense suite to expand its business spend management (BSM), and Community.AI, a tool to provide community-based data insights.

2022 — March: Coupa stock (COUP) falls below $100/share to a monthly low of $64/share.

2022 — November: On the 8th, Coupa stock (COUP) falls to $40.29/share.

2022 — December: Coupa announces a definitive deal to be acquired by Thoma Bravo, read our First Take Analysis: Competitive landscape, ecosystem and customer implications here.

Analysis and breakdown

Before going public in 2016, Coupa was already one of the major players in the procure-to-pay market. Over its 10 years as a privately-held company, it built itself into a e-procurement suite through various acquisitions and partnerships and gained a reputation as a solid vendor with easy integrations and a modern UI. Additionally, it had completed several rounds of funding that proved to be successful — while the initial business venture was funded by the founders, by 2016 Coupa had raised over $1 billion in various funding rounds.

For a company that was knocking just about every metric out of the park year-over-year, of course the next logical step was to go public.

Before going public, Coupa acquired four companies in the span of ten years. Since becoming public six years ago, it has acquired 12. Some of these acquisitions have added clear value: ConnXus brought a set of capabilities specializing in supplier diversity to Coupa that are now embedded in several processes such as supplier onboarding and sourcing; InvoiceSmash’s unification into Coupa’s larger P2P suite allowed for PDF invoice digitization; Simeno and Acquiire made Coupa a stronghold against its competitors when it comes to catalog management and access to external content using methods more advanced than traditional punch-out approaches; Yapta and Pana formed key components of what has now become Coupa’s expanded T&E solution. Conversely, some of the acquisitions have not yet panned out: Exari remains only loosely coupled with the core BSM suite from a data model perspective with the rest of the suite, and the larger acquisitions of LLamasoft and BELLIN, while admittedly a more complex expansion, are still early on their journeys to creating greater synergies with the core BSM suite.

Partnerships have been less prolific over the past six years that Coupa has been a public company, with a mixed bag of results: Coupa’s API integration with Amazon for Coupa Open Buy was largely successful, but Coupa’s modules in AWS marketplace do not seem to have had the expected result; Coupa’s partnership with Transfermate was the beginning of a very solid payment solution (Coupa Pay) that continued with partnerships with Paypal, Stripe, and Citi Commercial Cards, but Coupa’s partnership with Allibaba.com didn’t flourish as expected.

Regarding organic expansion, since going public, Coupa launched Coupa Payments, Coupa Open Buy, Services Maestro, a T&E suite and an app marketplace. It also launched Coupa Inclusion Initiative and Coupa Ventures.

Coupa’s journey on the stock market was fairly steady: initially, it was wildly successful, ending its first week as a public company valued about $1.4 billion. Over time, it continued to grow: even during Covid, it dipped only $14/share in March of 2020, and in July of 2020 Coupa crossed $300/share. It continued to grow until March of 2021, when it began trending steadily in the opposite direction. About a year later, in April of 2022, it permanently dropped below $100/share. By November 2022, it was only $40.29/share.

So what happened to cause the stock to drop?

One possibility is that Coupa bit off more than it could chew and alarmed investors. With each new acquisition and partnership, Coupa became increasingly fragmented. Additionally, guidance on what would happen with each of those new acquisitions and its various new business ventures was not always readily available.

As we note in our initial coverage of the Coupa acquisition news, Coupa is fighting battles on an increasing number of fronts, including forays into supply chain risk monitoring, carbon emissions estimation and supply chain collaboration; evolving capabilities like community intelligence; expanding the scope of its expense management product into full travel management; the regular maintenance of the core S2P suite experience and its quiet build-up in federal government procurement support that Coupa has been working on.

In addition, Coupa reached a turning point with Wall Street when it encountered global macroeconomic headwinds, as well as a rout within the larger technology sector. (Tech companies in general have been losing ground in 2022 in the stock market as investors consider recession concerns and post-Covid slumps.) As noted in an investor deck published December 12, previous revenue growth projections in the 30% to 40% range in this environment had become unsustainable. The company’s fiscal year 2023 and 2024 projections instead pointed to deceleration at 17% and 12% respectively, significantly below investor expectations 22% for F23 and 18% for F24 (originally 24% pre-March 2022).

 

Rather than continue a trend of misalignment with street expectations and internal projections, it makes complete sense that Coupa would instead seek to retrench under the ownership of an experienced tech investor such as Thoma Bravo and reposition to capture new opportunities that reveal themselves as the next stage of the economy becomes clearer.

Considering the above, it’s possible that Coupa’s aggressive expansion strategy could have succeeded more quickly in another era; perhaps without a likely recession or Covid, some uncertainty around its fragmentation and growth would have been given more leeway, allowing the company more time to realize its long-term vision.

Regardless, the reality is that while Coupa’s time as a public company has come to an end (for now) Coupa is still overall a strong company with an impressive offering. We look forward to seeing how Coupa will adapt and continue to grow in this new era.

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