Market Intelligence Content

Omnia acquires InsightGPO: Putting M&A at the center of a growth strategy

This week, Omnia Partners announced it was acquiring InsightGPO, the group purchasing organization arm of Insight Sourcing Group. According to the announcement, the transaction closed on Dec. 31, 2019. Prior to the definitive agreement, “InsightGPO was one of five divisions of Insight Sourcing Group,” which provided its “clients with highly targeted offerings for office supplies, auto rental, MRO and office equipment,” according to the press release announcing the deal.

Yesterday, I had the chance to speak to Tom Beaty, CEO, Insight Sourcing Group, and M. Todd Abner, President and CEO of Omnia Partners, to learn more about the transaction.

This Spend Matters Nexus brief shares a bit of what was learned (Omnia facts, figures) along with our own transaction analysis and a back-of-the-napkin valuation and relative multiples in the GPO market. It also traces the history of Omnia and provides a perspective on the GPO today (at an investor level) and future scenarios. We will follow up this Nexus M&A analysis with a detailed vendor snapshot/overview of Omnia on Spend Matters PRO this quarter, including a full SWOT, customer recommendations, etc.

For those interested in learning the basics of GPOs and how to use them as part of a category management portfolio strategy, we suggest you start with our past coverage and a chart showing the primary GPO market segments:

● An Introduction to Group Purchasing Organizations (GPOs)
● Group Purchasing Organizations: Supplier Perspectives and the Evolving GPO Landscape
● All We Are “Saved” — Give Purchasing Consortia (Including GPOs) a Chance
● The Healthcare Group Purchasing Organization (GPO) Landscape: Background, History and Introduction



Jason Busch is Managing Partner of Azul Partners’ Investor Advisory Group. He works with sponsors, CEOs and boards on data-driven due diligence, M&A and strategy. Jason is also the lead author of Spend Matters Nexus, a private newsletter and subscription service that publishes 50+ times per year. Spend Matters and Spend Matters Nexus are owned by Azul Partners. His investment disclosures and other activities can be found on LinkedIn.

2020 predictions from procurement software experts SAP Ariba, SAP Fieldglass and more

We’re continuing our compilation of 2020 predictions from experts in the procurement software market — with a look at what executives from SAP Ariba and SAP Fieldglass have to say. Spend Matters Europe Editor Nancy Clinton has collected 2020 predictions from a range of procurement software experts, including the source-to-pay suite provider SAP Ariba and SAP Fieldglass, a provider of technology for services procurement and external workforce management. They provided six predictions about procurement and procurement technology:

2020 predictions from procurement software experts like Basware, Ivalua, Efficio and more

Spend Matters Europe Editor Nancy Clinton has collected 2020 predictions from a range of procurement software experts like Basware, Ivalua, Efficio, VORTAL, State of Flux and more. The posts have run on the days leading up to the New Year, and more will run in the coming week. Here, we've consolidated the predictions and provided a highlight from each vendor.

2019’s top 5 most-viewed Nexus posts: 20 Tips; Workday-Scout RFP deal insights; Icertis and the red hot CLM market

Efficio

In July, Spend Matters Founder Jason Busch launched Spend Matters Nexus — his focus on the M&A and business side of the procurement technology market. Here’s how he describes it:

“The Nexus membership program is designed for investors/acquirers (private equity, corporate development, etc.) and solution provider CEOs in the procurement and finance technology/solution ecosystem. Membership offers a new strategic lens to the solution areas covered on Spend Matters.

"Nexus was borne out of an increased demand for research subscriptions, due diligence and strategy support with our private equity clients in late 2018 (which has picked up exponentially this year). But recently, our team realized there was a flip side to working with technology acquirers — providing relevant market intelligence and fresh, data-driven analysis for solution provider CEOs, boards and leadership teams.”

And here is a countdown of the top 5 most-viewed Nexus stories of 2019:

20 Tips to Maximize Private Equity, Investment and Strategic Buyer Outcomes (Part 9: Defining the ‘Post-Close’ Plan) [PRO]

In this Spend Matters Nexus brief, we’ll look at our final tip (No. 20!) for sellers to get the most from a liquidity event when raising a large growth capital round or selling to private equity or strategic buyers. This tip, defining the “post-close” plan, may seem like a simple follow-on effort that you can worry about after the ink is dry on a transaction.

But displaying leadership when it comes to the post-close plan before a deal is complete will both help your organization accelerate out of the gate after it is acquired or merged and will burnish your reputation with your new owners. As important, showing the ability to develop a realistic post-close plan with key checkpoints and milestones at specific intervals (like 90 days, 180 days, etc.) is a strong leading indicator that the implementation of such an effort will be a success — even if its components and details shift post transaction.

If you are just getting introduced to this series, start with the earlier tips. (Click here for Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7 and Part 8).

We have some hard questions about (and a soft spot for) Coupa’s new Business Spend Index (BSI)

Coupa recently released its Q4 Business Spend Index (BSI). Indexes such as ISM’s PMI and NMI can be helpful tools for procurement — not to mention economists, investors and policymakers — to gauge overall economic trends as well as underlying supply, demand and inventory conditions.

Coupa is a relative newcomer to publishing an index, but it offers a potentially promising approach based on underlying transactional data flowing through the Coupa system — as opposed to the polling data that is used for the ISM indexes, for example — to complement other economic indicators.

Still, we recommend that firms not read too much into the BSI for making procurement, economic or investment decisions without some additional details.

There are a few issues we’d like to see addressed if Coupa truly wants to make this a useful planning tool and not just a marketing vehicle for its community intelligence strategy:

Why would Medius buy Wax Digital? (Part 3: Strategy and competitive landscape analysis for AP automation and invoice-to-pay)

This Spend Matters Nexus research brief explores the potential competitive impact of the Medius and Wax Digital combination on the AP automation and invoice-to-pay markets. It also explores the strategies that some providers within these groups are already pursuing (or may pursue) in response to customer requirements, competitive pressures and the desire to expand the overall total addressable market, or TAM, for the AP automation sector and related opportunities.

AP automation and invoice-to-pay vendors compete in a market that is growing and changing by the day. This market counts AP specialists such as Accrualify, AvidXChange, Beanworks, SAP Concur, Symbeo, MineralTree, Medius, Yooz and dozens of others, as well as broader procure-to-pay providers such as Basware, Corcentric, Coupa, Oracle, SAP Ariba and Tradeshift. I previously described this market as “hot, hot, hot.” And I stand by that hyperbole.

Some of these providers have chosen to focus on the core of AP workflow and invoice processing; others have coupled AP automation with adjacent areas (e.g., payments and/or financing); and still others are more dramatically attempting to expand the value proposition that links AP to broader finance (and even procurement) functions through expanded modules and capability, including to procurement.

If you are just coming up to speed on the Wax Digital-Medius combination, start here with this Nexus series — (Part 1: Company backgrounds, product strengths/weaknesses, deal rationale) and (Part 2: Wax strengths, customers, integration considerations). Free Spend Matters’ news coverage of the deal can be found here and here.

Jason Busch serves as Managing Director of Spend Matters Nexus, a research and advisory group that works with sponsors, CEOs and boards on due diligence, M&A strategy and product strategy. Spend Matters and Spend Matters Nexus are owned by Azul Partners. Disclosure: Azul Partners served as an adviser to Marlin Equity in the Wax-Medius transaction.

What’s the Price: Vendor Introduction (Part 2 — Product Strengths and Weaknesses) [PRO]

In our last brief we introduced you to What’s the Price, a five-year-old Dutch vendor that offers should-cost modeling tools for supplier negotiations. Born out of the frustrations of two procurement professionals who wanted to get faster, more accurate price estimates to counteract supplier quotes, WTP makes smart use of publicly available big data to drastically cut the time and effort in building should-cost models. The solution is notably easy to use and provides a lot of guidance for users along the way, allowing WTP to get organizations up and running with just a two-hour training session. But as with all younger solution providers, there areas for growth, as well, including a few opportunities that could further support WTP’s preference for a self-service deployment approach.

Part 1 of this brief provided some background on What’s the Price and an overview of its offering. In Part 2, we provide a breakdown of what is comparatively good (and not so good) about the solution, a high-level SWOT analysis and a short selection requirements checklist that outlines the typical company for which WTP might be a good fit. We also give some final conclusions and takeaways.

Why would Medius buy Wax Digital? (Part 1: Company Backgrounds, Product Strengths/Weaknesses, Deal Rationale)

Earlier today, Medius announced it is joining forces with Wax Digital. Specifically, Medius, a Nordic-based provider of AP automation solutions with a growing presence in North America, is acquiring Wax Digital, a UK-based source-to-pay suite provider.

The entity will be owned by Marlin Equity Partners, a private equity firm, which purchased Medius in 2017. For those like me who have been around this sector for too long, you might remember Marlin for its purchase of Emptoris (before IBM acquired the provider from Marlin).

Flash forward exactly one decade from that buyout, and the combination of Medius and Wax brings together two providers with different geographic and product strengths with a combined emphasis on targeting finance and procurement organizations.

As we kick off our analysis in this Spend Matters Nexus series analyzing the transaction, we’ll focus this first brief on providing a quick overview of Medius and Wax Digital, and graphically explain how both fit into the source-to-pay landscape. We’ll also offer up high-level strengths and weaknesses on the solution level (for Wax) and a detailed introduction to the Medius AP footprint. Finally, we’ll begin to explore the rationale for the combination.

Later this week, we’ll delve more deeply into a particular strength of Wax based on Spend Matters’ SolutionMap data showing it has happy customers, explore the benefits of bringing together finance and procurement solutions to drive a larger total accessible market (TAM), and offer deeper insight into the potential integrations/touchpoints between Medius and Wax Digital. Finally, we will share an analysis of the impact on the competitive landscape, exploring how the combination may impact competitive AP automation and invoice-to-pay vendors as well as procure-to-pay and source-to-pay suites.



Jason Busch serves as Managing Director of Spend Matters Nexus, a research and advisory group that works with sponsors, CEOs and boards on due diligence, M&A strategy and product strategy. Spend Matters and Spend Matters Nexus are owned by Azul Partners. Disclosure: Azul Partners served as an adviser to Marlin Equity in this transaction.

SAP Ariba and Givewith partner on social-impact matching service

SAP Ariba and Givewith today announced a partnership where Givewith’s social impact solution will be available on the SAP App Center, giving SAP clients access to a matching service that allows them to find nonprofits to give donations.

Businesses increasingly are concerned with sustainability and corporate social responsibility (CSR), and Givewith analyzes thousands of nonprofits to match with businesses’ needs to improve their social standing, which studies have shown helps the bottom line as well as aids reputations with the public and improves worker recruiting and retention.

“If just 8% of the nearly $3 trillion transacted by buyers and suppliers across the Ariba Network included Givewith, we would generate over $3 billion in funding for nonprofits,” said Paul Polizzotto, Givewith’s founder and CEO, in a press release. “As we look to tackle some of today’s most pressing social, economic and environmental challenges, we see SAP Ariba as a strong partner in unleashing the power of business transactions as an agent for social change. Together, we’re elevating the role of procurement by turning sourcing into a key component of the company’s larger business and CSR strategies.”

In a Spend Matters PRO Vendor Introduction post, our analyst Nick Heinzmann shares what he learned after spending time evaluating Givewith’s solution, Givewith Enterprise.

Catching up on Corcentric, which has been on Spend Matters’ radar for years

Corcentric — a source-to-pay provider targeting procurement and finance groups with various software, services and capital/payment offerings — has been on Spend Matters’ radar for years as the New Jersey-based company has acquired and created solutions for the procurement technology market.

Converged source-to-pay models similar to Corcentric’s are thriving.

"Like GEP, Corcentric proves that you don't need to be a pure-play cloud software provider alone to carve out a material chunk of the fast-growing procurement solutions market," said Jason Busch, managing director of Spend Matters Nexus, which advises sponsors, boards and CEOs on M&A in the procurement sector. “Corcentric is a successful amalgam of procurement services, payment/financing, group purchasing solutions and source-to-pay technology. While the capital markets were previously confused by everything it did — including leasing — the value proposition for customers today is much clearer."

Mintec: Vendor Introduction (Part 2 — Positives and Negatives, SWOT Analysis, Selection Checklist) [PRO]

As we indicated in Part 1 of this Spend Matters Vendor Introduction of Mintec, there is no WaaS (weather-as-a-service) and, as a result, commodity price volatility in the agricultural sector is here to stay for the foreseeable future. But procurement professionals have to manage it somehow, and the only solution they have now is commodity market intelligence, of which Mintec is one of the largest, and oldest, market-intelligence providers in the sector.

With a database of over 14,000 unique market data sets across 20+ commodity categories and truly global geographies, Mintec is the go-to source for many large agricultural buying organizations around the world.

Should they be your go-to source too?

In this second part of our introduction, we’ll look at the positives and negatives and provide an overall SWOT and a selection checklist — all of which can help you make an informed decision.