In this article taken from the most recent edition of The Procurement & Spend Management Insider report we cover two key areas following on from the previous report published in April 2018:
- Industry News and Developments
- Demand and Supply trends in the sector
The procurement technology market has been a little quieter in terms of senior management moves and merger/acquisition activity than reported in our previous update.
In terms of acquisitions, we’ve seen three significant deals in recent months. Coupa acquired specialist vendor management solution provider DCR Workforce in early September on the back of announcing impressive quarterly financial results, showing revenue growth year on year of some 38%, better than analyst predictions according to Spend Matters.
This resulted in Coupa shares reaching a post IPO high of $80.73 in mid-September although they’d dropped back to just over $60 by mid-October.
More recently Coupa bought Aquirre in mid-October. Again more details on the deal are available from Spend Matters who explained that the new acquisition “stands out against competing e-procurement and procure-to-pay solutions for its superior front-end shopping user experience and its continued efforts to drive innovation within this segment of the procurement software market.”
Meanwhile Proactis continued their growth with the acquisition of Dutch firm eSize in August.
Rumours continue to circulate the market of at least one more significant business sale before the end of the year with a few underperforming vendors looking vulnerable, but nothing has been confirmed in time for this publication.
Notable senior management changes include both Dean Pathak and Patrick Hyati, Heads of Northern and Southern Europe respectively leaving SAP Ariba towards the end of the summer. Both had previously reported to EMEA GM Paul Devlin who left earlier this year.
Amabel Grant, formerly of Procserve, Barware and most recently the CCS has joined Bloom Procurement Services as CTO where she teams up with her old OGC colleague David Shields. This is a significant boost for the public sector focused firm.
Simon Dadswell has left Proactis where he was Marketing Director. Simon was a popular and regular presence at industry events like eWorld and moves into a new role outsider the sector.
In Europe Ivalua have been busy with their expansion. New recruits include Markku Kronqvist formerly of Synertrade who will give increased presence in the Nordics market. They’ve also hired Olga Alvado from BravoSolutions (now Jaggaer of course) in France who lost their Sales Lead Maurice Hamoir to Per Augusta.
SAP Ariba continues to hire extensively across Europe with clear emphasis on increasing their capability in their Customer Value organisation. This includes people with experience of implementing their solutions along with investment in key areas of customer success and value realisation.
Despite Coupa’s impressive results, it appears that hiring hasn’t been as aggressive for them recently, but the consultancies who support their implementations continue to invest in their teams, both in terms of numbers and developing capability.
Hot off the press is the news that Lance Younger will be leaving Deloitte in the next few months. Lance is the Lead Partner for Deloitte’s UK and EMEA Sourcing & Procurement practice with a focus on procurement transformation, enterprise cost reduction, supplier management and digital procurement.
He has strong relationships across a number of the key procurement software solutions including Ariba (where he used to lead their EMEA Consulting Team), Coupa, Tradeshift and several niche providers. We expect he’ll be a significant loss to Deloitte’s capability in this area, so it will be interesting to see how they replace him and where he’ll land next.
Notes on our observations from our last report
We predicted limited hiring from newly merged organisations in our last report. The three main deals that we mentioned were Jaggaer’s acquisition of BravoSolution, the Proactis/Perfect Commerce reversed takeover and Advanced Software adding Science Warehouse to their portfolio.
We haven’t seen any evidence to contradict our prediction as each of these organisations have largely been successful in retaining its key people albeit with a couple of exceptions as outlined above.
We did predict more merger and acquisition activity and there maybe more before the year end but with the uncertainty created by Brexit and other political trends geared around trade, it’s quite likely that we’ll see business leaders acting cautiously until these issues settle down.
23/1/19 update – this latest point is an interesting one. There was in fact one more deal in late 2018 as Coupa acquired Risk Management provider Hiperos although that was obviously driven in the US. Around the same time rumours surfaced of Tradeshift’s bid to buy Basware which is ongoing at the time of publication. In fact the one deal we heard may happen before Christmas hasn’t done so we’ll bring you news on that as soon as we can.