Procurement Strategy & Planning Content

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.

AP automation provider Medius today announced that it is buying Wax Digital, the UK-based suite provider of source-to-pay capabilities.

Medius, which is based in Sweden, sees the deal as a chance to allow its "current and future customers to generate increased automation, visibility and control across the entire purchasing process.”

Read more about the deal and how it reshapes the procurement technology market.

The global suite provider Jaggaer has been undergoing a lot of changes this year — converging its solutions on a single platform called Jaggaer One, getting a new owner this summer and seeing a change in leadership a few weeks ago.

To learn more about these changes, Spend Matters Founder Jason Busch talked with Jaggaer’s new CEO, Jim Bureau, who has been with the company a little over two years and most recently was executive vice president.

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."

Today was supposed to end a relaxed week, with two days of PTO for a variety of family activities. Instead, the week went wild — when Workday caught everyone slightly off-guard Monday as it announced that it would acquire Scout RFP.

That news launched a flurry of activity here, because I love real-time coverage of procurement sector M&A.

And with the investment-focused Spend Matters Nexus officially launching the same day as that breaking news, the timing, except for my scuttled plans to relax a bit more than usual, could not have been more perfect. This week I also ended up having some meetings with clients. And the lessons from the Workday and Scout news have resonated in many of the meetings. (See our Nexus coverage from this week that led to the insights.)

Our final Spend Matters Nexus brief for the week analyzing Workday’s acquisition of Scout RFP focuses on potential product and workflow integration touchpoints between the providers, based on activities that Workday and Scout worked on while “partners only” as well as more strategic considerations. (See the first three installments here, here and here, covering general deal analysis, Scout capabilities + strengths/weaknesses, and competitive sector analysis.)

Today’s analysis begins with a list of generic sourcing integration touchpoints with broader source-to-pay and procurement technology capabilities.

As our Nexus coverage has shown, we tend to look at the acquisition of Scout as a clever, innocuous way for Workday to get into the edges of procurement with a standalone, crowd-pleasing solution. But we also think there’s much more to come from a Workday product roadmap perspective — and that this move is only one of the first acts of a much longer play.

Note: This analysis will be updated next week based on a briefing call with Workday.

 Jason Busch serves as Managing Director of Spend Matters Nexus, a membership, research and advisory organization serving technology acquirers (private equity, corporate development, etc.) and CEOs in the procurement and finance solutions marketplace (including contract management, B2B marketplaces/connectivity, indirect procurement, services procurement, direct procurement, commodity management, payment, trade financing, GRC/third-party management and related adjacent sectors).

Buzzwords abound out there, and a lot of common words are used by folks without necessarily having a common understanding of the meaning. For example, take the phrase “digital procurement transformation.” Even the individual words themselves alone can have different interpretations:

* Digital — Does this mean digitization of procurement processes through workflow automation, or is it something broader?
* Procurement — Is this all of source-to-pay or just procure-to-pay? Or just everything that a procurement department does, including broader supply chain efforts?
* Transformation — Can this just be incremental, continuous improvement, or does it have to be a more discontinuous transformation program?

The problem for practitioners is how to cut through the clutter of this terminology and more easily learn from others surrounding adoption of “digital” in different ways. For example, there is certainly a lot to learn just in terms of better implementation of systems for automating good old-fashioned sourcing, requisitioning, ordering, receiving and paying.

But, there are also higher order digital capabilities that go beyond just automating the proverbial cow path. For example, advanced analytics such as bid optimization can enable new sets of sourcing processes that were not really feasible before. Similarly, techniques such as community-based procurement that use technology across firms can create new value beyond automating within a single firm.

There is actually a spectrum of digital related competencies from basic source-to-pay workflow automation all the way through to procurement-enabled disruptive value chain initiatives. So, if you have mastered some of these basic capabilities for digital transformation and procurement, it is time to raise the “degree of difficulty” and see how others are faring in terms of picking the higher hanging fruit.

In this Spend Matters PRO analysis, we will outline six levels of digital procurement sophistication, and also see how more than 400 organizations stack up based on the latest research.

Earlier in the week, the finance and HR solutions provider Workday announced it was buying Scout RFP, a sourcing solution for those who would rather use Uber than maintain an old car (I make this observation with full cynicism intended because my 25-year-old car has been in the shop for three of the past six months ).

You can find previous free coverage of the transaction news on Spend Matters here and here. In our first Nexus subscriber brief covering the procurement technology sector’s M&A news, we offered background on Scout RFP, explored the provider’s strengths and weaknesses, and gave our initial insights into the rationale for the transaction. The second brief explored the competitive implications of the transaction on Workday’s ERP competitors.

As we continue our analysis on Spend Matters Nexus, we turn our attention to landscape implications of the transaction that may affect other, specialized procurement technology providers. We also offer lessons learned for this group as well in terms of what really matters with driving customer success, growth and, subsequently, valuation. Today’s research brief provides a competitive analysis for the source-to-pay suite market segment (e.g., Corcentric, Coupa, Ivalua, Jaggaer, SAP Ariba, SynerTrade, Wax Digital and Zycus) as well as specialty providers that emphasize the sourcing area. U.S. and European sourcing specialists include Allocation Network, Bonfire, EC Sourcing Group, K2 Sourcing, Keelvar, MarketDojo, Promena and ScanMarket and my favorite, at least for its name, SourceDog.



Since the other dog is my car right now and I’m late for a meeting, let me call that proverbial Uber and get on with this analysis.

Jason Busch serves as Managing Director of Spend Matters Nexus, a membership, research and advisory organization serving technology acquirers (private equity, corporate development, etc.) and CEOs in the procurement and finance solutions marketplace (including contract management, B2B marketplaces/connectivity, indirect procurement, services procurement, direct procurement, commodity management, payment, trade financing, GRC/third-party management and related adjacent sectors).

Workday, a provider of finance and human resources solutions, has announced its intent to acquire Scout RFP for a cool $540 million in cash. For those with a long-time background in the industry, this might at first seem like a somewhat mind-boggling sum for a sourcing provider, bringing back memories of Ariba buying Trading Dynamics in the early B2B sourcing era.

But things are a bit different this time, as Scout is bringing rapid growth, material customer numbers (240+ customers) and material ARR growth to the table (we’ll do a back-of-the-napkin analysis of ARR and revenue contribution later in this series). Moreover, it’s an innocuous way for Workday to target procurement without having to go after “the hard stuff” (another key theme we’ll explore).

So beyond the somewhat shocking number at first, the deal can begin to make sense if you peel the transaction onion. So let’s begin.

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 Scout, graphically explain where it fits in the source-to-pay landscape, explore the provider’s strengths and weaknesses, and then begin to delve into the rationale for the deal from the Workday vantage point.

Later this week, we’ll offer an analysis of the M&A and deal components of the transaction (e.g., estimated multiples), provide deeper insight into the integrations/touchpoints between Workday and Scout, and share an analysis of the impact on the competitive landscape (for competitive ERPs, source-to-pay suites and independent sourcing providers).



Jason Busch serves as Managing Director of Spend Matters Nexus, a membership, research and advisory organization serving technology acquirers (private equity, corporate development, etc.) and CEOs in the procurement and finance solutions marketplace (including contract management, B2B marketplaces/connectivity, indirect procurement, services procurement, direct procurement, commodity management, payment, trade financing, GRC/third-party management and related adjacent sectors).

Presenting at an industry event is an important step in any professional's career. It is also an excellent opportunity to promote, showcase and reward a team for a job well done. But most importantly, it is a critical factor in keeping an industry relevant, competitive and strong. Every professional worth their salt should consider it their duty to share their successes and failures.

Of course, in order to present at an industry event, you must first submit a proposal in the form of a session abstract. Sourcing professionals are well-versed in writing business cases and category strategies, and we have all read our fair share of good and bad proposals. However, when it comes to writing a speaking proposal, many sourcing professionals don’t give it the time or energy it deserves. These abstracts are often used to describe your session, and if the goal is to share your thought leadership, you will want to make sure your abstract grabs your audience’s attention. Consider the following five tips to write a compelling proposal for your next industry event.

Earlier this summer, I created a new role for myself at Spend Matters, going back to my roots as an adviser to investors, boards and management teams focused on strategy and corporate development topics.

As part of this transition, we’re excited to officially launch a new subscription service, Spend Matters Nexus, with content specifically written for founders, CEOs, corporate development leaders, and the private equity and investment community interested in the procurement landscape. We initially made this content stream available to all PRO subscribers as part of a transition period, but as of this month, Nexus will officially become an independent subscription.

Look for the first official Nexus column to post later today. Read on to see why now is the time for Nexus.

I wanted to continue my SIG post from the other day that looked at lease spend and why it’s gaining importance. In recent years, lease spending has come under the microscope because accounting rules now require publicly held companies to disclose their lease spend on their balance sheets. Private companies and government agencies will have to do the same eventually.

The foundational piece of effective leasing spend management is assembling all that data to enable the proper accounting treatment for leases. This also paves the foundation for better visibility and control of leasing spend as well (to learn more about the basics, a recent Spend Matters’ article looked at why lease spend is poorly managed).

But visibility is different from impact. Once procurement has helped finance properly account for new financial reporting requirements, there’s an opportunity to drive lease savings as well.

So let’s look at where the value and savings can come from.