Category Archives: Miscellaneous

Is Coupa’s Third Act Its Final Act?

Post Edit: The summary on LinkedIn has been removed.  Note that this is an opinion piece and read why in the Social Media Policy.

After Sunday’s lyrical Coupa Cabana, you knew something was coming. But you probably weren’t sure what, since the tone was a bit different than the Coupa songs the doctor used to publish back in the day when it was Coupa Time and he sung the praises of the Coupa Store (and even gave the farmers their own Hoe-Down so they knew that even they could embrace the tech).

In comparison, the Coupa Cabana is pretty lamentful, but not entirely unexpected, as the doctor did foreshadow this 18 years ago (yes, eighteen years ago — feels like coverage has been ongoing for my whole life) in his tribute to Procurement Independence at the Coupa Cabana Cafe. (For a brief instant, Coupa completely changed the game, and when you change the game … )

Back in the Day, before this make margins multiply marketing malarky, and well before the Business Spend Management of its second act, it had a, now long forgotten, first act where Davie wanted to change the Procurement world with an affordable user friendly e-Procurement solution that could be used by anyone anywhere in any assembly.

And that was Coupa’s first act. A pure multi-tenant SaaS application that could be licensed for low five figures by any organization that wanted it, turned on with the flip of the switch, easily populated with an xml or csv upload, integrated with your favourite punchout sites, and rolled out to every single employee in the organization, with appropriate controls to make sure they could only request what they had access to and buyers had the ability to accept, modify, or reject as needed. That’s right. Real “intake” back in 2006 with a real procurement app to back it up. (And built in an unassuming, affordable, non-glitzy strip-mall office, down the street from the Amazon Motel, where it didn’t cost a million dollars to dance on the roof.) In the slang of the day, it was sick.

And if you were small and couldn’t afford a few grand a month, or wanted to try it for free, no big deal — a stripped down version was offered as open source, and as long as you were technically inclined (and knew Ruby on Rails), you could download it, install it, play with it, and even use it if you wanted to. (It was way more economical to get a SaaS license then devote your own IT staff to supporting it, but the free version allowed you to verify that it would work for you and wasn’t silicon snake oil.)

It was simple, but effective, and, most importantly, game-changing. And investors noticed. And they invested, but with big dollar signs in their eyes (which they knew the rich and filthy would pay). And this meant bringing in a visionary with even bigger dollar signs in his eyes. Davie was ditched (and Noah was set adrift on the ark) and Robbie was bought in to lead the Coupa Factory for the second act.

Robbie dreamed of a day where a client could manage all spend through Coupa, making it indispensible, and bringing in the Salesforce sized contracts he used to. But all Coupa did was core e-procurement, so off on an acquisition spree he went. And a spree it was. By 2021, in an effort to build a platform that could do everything, it had made twenty (20) acquisitions across the Source-to-Pay spectrum, including a couple in Finance (Bellin) and Supply Chain (Llamasoft). And while it still doesn’t quite fulfill the entirety of Business Spend Management (because it doesn’t do payroll, and doesn’t do advanced financial planning), it can literally track most of the dollars that flow through a third party if enough modules are obtained (and enough dollars are shelled out).

But you need a lot, which costs more than all but the largest enterprises can afford, and it has to be appropriately configured, which requires expertise that few have.

And this is the crux. While acquisitions boosted Coupa capability and talent in the early days, lending credence to the promise of Business Spend Management (which later became known as
B6llsh!t Spend Management in some private circles) which never fully materialized (and still causes some of us to twitch, but not in a good way), as time went on, the inevitable happened. The top tier talent they acquired, when their options vested or hiring bonuses became non-repayable, moved on or retired from Procurement on the windfall. (Were they the lucky ones?) And the majority of the talent that knew how to not only enhance, but help a client take full advantage of their top tier advanced spend analysis (Spend360), sourcing optimization (Trade Extensions), or supply chain planning & optimization solution (Llamasoft) moved on (as did their 1st employee and CTO). This also happened at their other 17 acquisitions, and I’m betting at this point that for most of the advanced features in most of their advanced modules, there are at most 2 people who can demo them. And none that can even demo half the end-to-end Coupa solution.

However, as you know, the second act came to a close last year when Thoma Bravo bought the Coupa Factory, showed Robbie and a good portion of the management team the door (before they could get Inspired from the acquisition), and sat idly by as the rest of the senior management team moved on of their own accord, along with a significant number of the long-time employees. So many have left over the years that, at this point, of the 3,000 employees LinkedIn says they still have (which might not be entirely accurate as many who leave don’t update their LinkedIn until they get a new position, and new hires don’t always update their profile either), as of one week ago today, it would appear that there is not a single employee left who knows the potential platform capabilities better than the doctor. (Who is not only one of the only two remaining independent analysts in our space who have been covering Coupa since Procurement Independence day, but someone who has also advised, consulted for, or done diligence on half of their acquisitions — which is a heck of a lot more than their current stable of developers and managers can say. And yes, he’s choking on the truth at this realization!)

And the third act is not off to a great start. First of all, it took them a long time (almost a year) to find a new head of the Coupa Factory, leaving 3,000 poor, scared Oompa Loompas wondering about their future. Second, their management team is brand new and many don’t know the full history or power of the platform at their disposal. Third, their “make margins multiply” rebrand is the biggest marketing malarkey out there today (and the doctor hopes it’s just a moment of weakness and that they’ll move on from it quickly) because no one who reads it knows what it means from a solution perspective (sounds more like sales than Procurement) and, to top it off, their new homepage is among the most uninformative buzzword-filled page you will find in Source-to-Pay. Fourth, there’s no centre anymore. It’s Finance. And Procurement. And Supply Chain. And IT. It’s not just a letdown, it’s the saddest part of all!

It’s important to remember that, unlike almost all of its competition that went on M&A sprees, Coupa’s philosophy was to integrate everything into the Coupa platform as natively as possible. If it was built on the same stack, in it went. If not, it was refactored into a (micro) service architecture with the front end UI rebuilt in the core and the back-end run in a service container, so it was one platform with one consistent UI for their customers. As a result, they are sitting on a powerhouse, and all they have to do is pick a direction and configure it as one. But this is not likely to happen in the near future, because it’s unlikely anyone left at Coupa can see what that direction is and could be at this point. (Maybe after a couple of years of diving in to see the true power of the solution they possess, but Coupa is so big no one can come up to speed quickly on the full breadth of what’s there).  (So while this should be my greatest masterpiece when it comes to Coupa coverage, it is also a letdown.)

While no one can predict what the future holds, we can say that if Coupa doesn’t learn what they have, center on a direction, educate the next next generation on what Coupa can actually do, and come up with a meaningful message soon, there’s a good chance that the King of Karma may decided to collect his toll and this could be Coupa’s final act before it is folded into an amalgamated ThomaBravo FinTech platform designed to replace the ERP that currently powers the finance back office. (ThomaBravo have 80 companies in the portfolio, including a number in FinTech. If anyone was going to build the first FRP [Financial Resource Planning] solution designed to replace the ERP, it could be them.)

Thoughts to the contrary?

All we can say is that I sincerely hope this doesn’t happen, that we hope that we are wrong, and that Coupa is secretly working on a new Sourcing/Procurement/Spend/Supply Chain focus messaging and platform that will be instantly understandable to anyone who sees the message, and that they continue to grow and thrive.  We’ve been covering them for 18 years and would really like to cover them for 18 years more!

Coupa Cabana

Its name was Coupa, it was procurement
For anyone to make a buy, through the browser on first try
And it would guide you and satisfy you
And when you had to order quick
It was just a point and click
Across the crowded net, you could buy with no regret
It was new and the UI was slick
Who could ask for more?

At the Coupa (Cou) Coupacabana (Coupacabana)
The hottest app north of Havana
At the Coupa (Cou) Coupacabana
Procurement passion was always in fashion
And with Coupa you fell in love
Coupa, Coupacabana

It’s UI was clean
It lit up the screen
A buyer would leap from his chair, he saw all the items there
And when he hit buy, auto PO would fly

But money took it oh so far
The stack is now an app bazaar
What was a simple app, a 20 SKU mousetrap
Too much cash and a M&A bash
Tell me who bought who?

At the Coupa (Cou) Coupacabana (Coupacabana)
The hottest app north of Havana
At the Coupa (Cou) Coupacabana
Procurement passion was always in fashion
And with Coupa, you lost your love

(Coupa, Coupacabana)
(Coupa, Coupacabana)
(Coupacabana)
like in Havana
(Coupa, Banana)
Procurement passion was always in fashion

It’s name was Coupa, it was procurement
But that was fifteen years ago, when everyone could go
Now it’s a full stack, but not procurement
Where’s the app they used to share
Made for buyers everywhere

It sits there, so refined, with marketing half-blind
The thrill is gone and so is Davie
Will we lose our mind?

At the Coupa (Cou) Coupacabana (Coupacabana)
The hottest app north of Havana
At the Coupa (Cou) Coupacabana
Procurement passion was always in fashion
And with Coupa you fell in love
Don’t fall in love!
(Coupacabana)
(Coupacabana)

Solution Smash-Up! PROPHETic Vision or Magic 8-Ball!

A few weeks ago, THE PROPHET, who noted he was often asked about which disparate providers and/or solutions might work well together (as part of his strategy and M&A work), said that the answer(s) always depend on hard dollars and common sense in a recent article on LinkedIn.

He noted that there were questions that could be asked to help make the determination between any two specific providers and/or solutions, which included:

  • From a TAM perspective, will it increase the TAM beyond 1+2=2?
  • Does it add additional ideal customer profiles or elevate the solutions to the C-Suite?
  • Does it open up additional GTM strategies and channels?

… but also noted that you can go beyond just payments with AP (traditionally Treasury and Accounting), and provided five examples of solution smash-ups that were a bit more “radical”. In a nutshell, with only minor paraphrasing, these were:

1. Intake Management, “light” e-Pro, and GPO.

This makes perfect sense — there’s a reason intake pre-dates stand-alone intake solutions (Zycus launched iRequest back in 2015, almost nine years ago), and that’s because intake and e-Pro go well together; adding in the GPO allows the organization to take advantage of better prices for regular purchases and makes sense.

2. Contract Management and Price Compliance.

The whole point of contracts is to lock in commitments, which are useless if not realized. Integrating contract management into a price monitoring solution, be it part of e-Pro or AP or payments, is a great choice.

3. Third-Party Risk and Working Capital Management.

Before a cash outlay, or an agreement thereto, it’s a good idea to understand the risk.

4. Spend Analytics and BOM/Part-Level Management.

Well, this already exists in some specialists — mainly in electronics (think Levadata and SupplyFrame), but other players are popping up in other verticals as well. (Sievo and Scalue do a great job of doing direct material or part analysis; and Scalue’s material categorization is great for direct management.)

5. Solve Supplier Supervison Sheol

A few companies are starting to make good progress here on “on-boarding, 3PRM, cyber, GRC, and ESG in one place”. Think Brooklyn Solutions, for example.

So, 3 for 5 on new ideas for solution smash up.

The real question is, what solutions could we smash-up that that, on an initial analysis, shouldn’t increase the TAM, elevate the sale, or open up obvious new GTM solutions … because that’s the smash-up no one will see coming, that we won’t see twenty new entrants next year (where ten will ultimately fail), and that will create the new unicorn. And for this, we’ll need to extend Source-to-Play further into the enterprise.

Here are three smash-ups that might seem strange on the surface, but if look deep, and innovate, you can see how they might just be one of the next break-out solutions.

A. Payroll, Benefits, CLM, SOW, and Sourcing Optimization

Manage all people-related spend in one application to balance employees vs. contractors vs. services firms to balance cost vs. risk (of knowledge walking out the door, resources not being available, etc.)

B. WIMS, Distributor Marketplace, and central e-Procurement Catalog

Optimize not only inventory balance between the local office/warehouse/retail outlet, central warehouse, and distributors and guide the buyer to the right inventory at the right time, auto-replenishing as needed.

C. MRP, Assembly Line Control, Quality Control, and Order Management

Continuously monitor materials coming in, used, defect rate, and intelligently re-order against an existing contract as needed.

Of course, if you want to be the next magical unicorn, you’ll have to get even more radical. Anyone have an idea for a solution smashup that makes almost no sense on the surface but, if you get radical, could revolutionize the space? (If so, and you need a prescription to help flesh it out, you know who to call.)

The Sourcing Innovation Source-to-Pay+ Mega Map!

Now slightly less useless than every other logo map that clogs your feeds!

1. Every vendor verified to still be operating as of 4 days ago!
Compare that to the maps that often have vendors / solutions that haven’t been in business / operating as a standalone entity in months on the day of release! (Or “best-of” lists that sometimes have vendors that haven’t existed in 4 years! the doctor has seen both — this year!)

2. Every vendor logo is clickable!
the doctor doesn’t know about you, but he finds it incredibly useless when all you get is a strange symbol with no explanation or a font so small that you would need an electron microscope to read it. So, to fix that, every logo is clickable so you can go to the site and at least figure out who the vendor is.

3. Every vendor is mapped to the closest standard category/categories!
Furthermore, every category has the standard definitions used by Sourcing Innovation and Spend Matters!
the doctor can’t make sense of random categories like “specialists” or “collaborative” or “innovative“, despises when maps follow this new age analyst/consultancy award trend and give you labels you just can’t use, and gets red in the face when two very distinct categories (like e-Sourcing and Marketplaces or Expenses and AP are merged into one). Now, the doctor will also readily admit that this means that not all vendors in a category are necessarily comparable on an apples-to-apples basis, but that was never the case anyway as most solutions in a category break down into subcategories and, for example, in Supplier Management (SXM) alone, you have a CORNED QUIP mash of solutions that could be focused on just a small subset of the (at least) ten different (primary) capabilities. (See the link on the sidebar that takes you to a post that indexes 90+ Supplier Management vendors across 10 key capabilities.)

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