Expense Management

Expense Management

April 29, 2013

Coupa on the Fast Track in Expense Management

Purchasing and expense management (procurement, invoicing and reimbursement) is an integral part of any business. It’s been around before the dawn of PCs and dot.com, with tons of software programs written and upgraded technology to correct work flow inefficiencies, you would think that business finance is running smoothly while saving money, however, according to a 2010 report from Aberdeen (News - Alert) Research, companies are spending a staggering $28.91 to process a single expense report.

Enter Coupa, one of the many startups that are making bids to help modify and manage business financial processes (paying and accounting for the supplies, materials and services). What’s the difference between Coupa and other startups? For one, Coupa has $49 million in funding from Mohr Davidow Ventures, Crosslink Capital, Battery Ventures, BlueRun Ventures and El Dorado Ventures.

In an effort to overtake corporate procurement and expense management from older competitors, i.e. Oracle (News - Alert), Concur and Ariba, Coupa offers a user-friendly subscription-based Web and mobile service for placing purchase orders, paying invoices and submitting expense reports.

CEO Rob Bernshteyn is the vision behind Coupa’s success, a former SuccessFactors executive who joined Coupa in 2009. His visualization for the company is half technology and half ideological. On the technology side, it’s all about cloud; the company believes that Web-based, software-as-a-service approach is more flexible and efficient in tackling complex, cross-organization function, such as expenses. Coupa works on a suite of cloud-based applications, requisitions and purchase orders, invoices, business or travel expenses, centralizing purchasing contracts, comparable spending, and reverse auctions (suppliers compete for a company’s business).

On the ideological side, Bernshteyn views customers and the way the company thinks about sales, focusing on helping individual users to be more successful in their organizations, instead of unclear measures of “customer satisfaction.”

“Most employees would like to do the right thing when it comes to spending company money,” Bernshteyn says. “They just don’t have the patience to dig through company policies or use complex client-server software to find an approved supplier, so sometimes they take shortcuts.”

With half a million transactions flowing through the system daily, totaling of more than $5 billion per year, it appears that Coupa’s solutions are working. Doubling in size in over an 18-month period to nearly 200 employees, Coupa placed a No. 1 ranking of e-procurement companies, overcoming competitors such as Ariba and SAP (News - Alert) by Gartner Research in 2011.

“There is maverick spending everywhere,” Bernshteyn says. That’s because “in the past, procurement was a blocker. If you wanted to get anything done, you had to go around them. Our philosophy is exactly the opposite.”

Coupa also contends that it’s the only maker of spending management software that puts procurement, invoicing and expense tracking into a single system, verses Concur, which mainly handles expense reporting, and Ariba, acquired by German software maker SAP, which mainly handles procurement.

Bernshteyn calls Coupa “a single solution for controlling all non-payrolls spending in the cloud.”

Many Coupa customers who have consolidated these previously separate functions have seen their administrative costs for expense management reduced by up to 11 percent.

With 300 stable customers and businesses demanding for office software that’s faster to implement and more user friendly, along with Coupa’s software running on the iPads of store managers at Subway locations worldwide, it’s evident that Coupa is a formidable competitor to giants like Oracle and SAP.

“The big players left us an opportunity to fix the mess,” Bernshteyn says. “The opportunity is huge.”

Edited by Rachel Ramsey

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