Industry News Content

By Spend Matters’ count, there are hundreds of cloud technology providers in the procurement technology sector, and well over a thousand if you count providers with a solution orientation (which may include market/category intelligence, consulting, advisory and related capabilities). Investor and M&A interest across this landscape of providers — from both strategic and financial buyers — is at an all-time high.

We define procurement solutions as technologies and services that target a range of areas that include:

— Core procurement (i.e., source-to-pay, procure-to-pay, etc.)
— Direct procurement
— Services procurement
— Contract management (that goes beyond supplier contracts)
— Accounts payable
— Trade financing (B2B Fintech)
— B2B (transactional connectivity, marketplaces, aggregation and GPO models)
— Third-party (supplier) management, from a GRC standpoint as much as from a procurement standpoint

In the first installment of the series, we introduced the first five groups of providers attracting the most investor and buyout attention: procurement technology suites, transaction-focused solutions, payment/financing providers, nimble solutions and leveraged buying/GPO models.

Today, we continue our focus on the “who” — exploring the final five groups of providers, including sharing illustrative providers in each segment and why buyers are attracted to each group. The five groups are:

— data/analytics/market intelligence solutions
— services procurement providers
— contract management and analytics vendors
— supplier management (and contractor management) providers
— “finance first” or “fi-pro” procurement solutions

Series Abstract: This multi-part Spend Matters PRO research brief explores the “who” (i.e., what types of companies are attracting the most interest and the profile of different buyers), the “why” (i.e., typical investment theses) and the “how” (i.e., the mechanics of deal processes and what is unique to the solution area, including where buyers that are new to the sector often have a higher learning curve than expected). It also explores some important dynamics in the market that have changed in recent months as buyer interest from both the strategic and financial sides increases.

Fiverr (NYSE: FVRR), the online marketplace for digital creative services, priced its 5.3 million IPO shares Wednesday night at $21 per, raising about $111 million in new funding. On Thursday morning, shares began trading at $26, but when the market closed in the afternoon, Fiverr’s share price had risen to $39.96 (nearly doubling). Based on the closing price per share and an estimated 31 million shares outstanding, Fiverr’s market cap would be about $1.2 billion, or 16 times revenue.

We will provide further analytic post-IPO coverage soon. In the meantime, check out our recent PRO series: Fiverr, the Online Services Marketplace, Is Going Public: What You Need to Know — Part 1 and Part 2.

Welcome to the June 2019 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to PLUS and PRO subscribers. For those new to the Hot List, each edition covers the prior month’s important or interesting technology and innovation developments in the CW/S space. Uber, Deliveroo, Doordash and Fiverr are among the companies making news.

For the buyers and category managers out there, especially those of you deep in the weeds of buying and managing commodities, here’s a quick rundown of news and thoughts from particular commodity markets. MetalMiner, a sister site of ours, scours the landscape for what matters. This week: Alumina refinery restarts in Brazil after a spill last year, Modi's re-election in India has chance to move markets, China may curb rare earth mining over trade war with U.S.

The mutual insurance firm FM Global this week released its 2019 Resilience Index, examining economic indicators, risk factors and supply chain issues in 130 countries around the world — ranking the nations by the resilience of their business environments. The index is meant to be a tool for senior executives to conduct “vulnerability assessments and build their companies’ resilience around the world,” according to FM Global, which focuses on property loss issues. Norway topped the list, and Haiti came in last. Read on to find out about the U.S., China and Russia.

Late in April, SAP announced that it was bringing its procurement assets under a single operating umbrella. The announcement of the new business unit, tucked into the body of a press release with the headline of a leadership promotion, notes that the “SAP Intelligent Spend Group” will be “comprised of SAP Ariba, SAP Fieldglass and SAP Concur.” The group, according to the announcement, would be headed by SAP Ariba and Concur veteran Barry Padgett, but this week we learned that Padgett left SAP. Regardless of leadership, the Intelligent Spend Group will move forward. This Spend Matters PRO brief provides an analysis of what the creation of a single organization within SAP for these solutions may mean for each individual solution line and customers.

At Spend Matters, most of our time is spent actually looking at solutions and evaluating and validating detailed RFI responses. So when a procurement organization asks us, for example, “how does SAP Ariba compare to Coupa for source-to-pay,” we can provide a detailed explanation across hundreds of different functional specifications and customer satisfaction benchmarks about how the two precisely compare and differentiate. We get questions on these two providers a lot.

Technology vendors reach a milestone when other providers (as well as practitioner and consultants) start using them as a yardstick to measure and compare capabilities. And now with Ivalua reaching unicorn status and sharing current growth metrics that generally dwarf that of its larger peers — based on organic product growth — we expect to hear more and more procurement organizations ask about Ivalua in the same way they ask about SAP Ariba and Coupa. And of course from a SolutionMap perspective when it comes to technology selection, we can answer that question with hard, objective data on a capability-by-capability basis (now mapped to procurement business requirements).

But off-the-cuff, how does Ivalua and its unified suite compare to others?

I asked my colleagues on the Spend Matters analyst team who know different areas of Ivalua (and its peers) to comment not using the SolutionMap benchmark, but their own opinion.

So without further adieu, let’s read the Spend Matters analyst team’s candid take of how Ivalua’s source-to-pay competitors measure up to it (including positives and negatives comparisons for each). Our analysis explores, on an overall company basis, subjective views about how the following vendors compare to Ivalua: Coupa, Determine (now part of Corcentric), GEP, Jaggaer, SAP Ariba, Oracle, SynerTrade and Zycus.

Do you want the objective, hard comparative data on a functional and product basis to understand how Ivalua stacks up to peers? Check out SolutionMap Insider.

Ivalua, likely the fastest growing privately held source-to-pay procurement suite technology provider, announced Tuesday morning that, with its latest funding round, it has gained “unicorn” status for start-ups by reaching $1 billion in valuation.

It raised $60 million from a new investor, Tiger Global Management, and Ardian Growth, one of Ivalua’s early investors that raised its investment level. Tiger Global joins Ivalua’s founders, KKR and Ardian as shareholders, the announcement said.

For the buyers and category managers out there, especially those of you deep in the weeds of buying and managing commodities, here’s a quick rundown of news and thoughts from particular commodity markets. We scour the landscape for what matters — from price movements to policy decisions. This week: Domestic steel price weakness, sustainable mining, and U.S-China trade tariffs and talks fallout.

Being a public company is not always easy, with performance vs. market expectations being put under the microscope every quarter. And Upwork (NASDAQ: UPWK), the global online freelancer marketplace and managed services provider, found that out Wednesday, May 9, after it announced its Q1 2019 financial results, which seemed to pack few, if any, surprises.

At the same time, while the shares fell swiftly from just over $20 to under $17 in after-hours trading, it bears remembering that, just months ago at the start of October 2018, Upwork offered its IPO shares at $15. Though this may not be a consolation to investors who acquired shares when the stock was trading between $20 and $25 in February and March, it may be somewhat reassuring for more conservative investors that expect a company’s share price to be linked to its fundamentals, including uncertainty.

In Part 1 of this two-part Spend Matters PRO series, we attempt to understand what was revealed shortly after 4 p.m. Eastern time May 9, that caused such disappointment among investors. In Part 2, we will look at Upwork’s several updates to new growth initiatives in the business (e.g., the creation of four service/pricing tiers for buy-side businesses), and we will offer our own perspective on Upwork’s current position as a high profile player in the changing contingent workforce space.

Last Thursday, I had the pleasure of attending my first CPO event run by Global Business Intelligence. Some 60 chief procurement officers, many locals, gathered for the daylong GBI event at the W Union Square in New York to exchange thoughts on supplier collaboration, value engineering and procurement digitization — among other topics. Here’s what I saw and was of interest to me, as Spend Matters’ chief marketing officer.

SAP recently has consolidated its separate business units SAP Ariba, SAP Fieldglass and SAP Concur under its new SAP Intelligent Spend Group division. So it seemed like a good time for me to catch up with an industry insider to shed light on the issues.

Dr. Marcell Vollmer is now the chief digital officer of the Intelligent Spend Group, after filling the CDO role for SAP Ariba since 2017, when I talked to him in a series of Spend Matters interviews about digital transformations and about his stint as the chief procurement officer for SAP.

Recently, he said one area of opportunity that he sees is in procurement, where CDOs should spend more time.