The rise of 5 “Alt” Suites for procurement technology
Earlier this week Coupa’s stock took a significant slide on reduced margin guidance and a still double-digit but more conservative growth forecast than analysts were expecting. Of course, the reaction from executives and investors was predictable in terms of the questions this raised about the sector.
Multiple CEOs and colleagues in private equity, corporate development and venture pinged me to know whether Coupa’s guidance signaled a potential headwind for the broader sector.
Everyone wants to know: is this market slowing down?
The short answer is: No
In fact, parts of it are expanding at some of the most brisk rates I’ve seen in my 25 years analyzing the sector. But there are changes afoot. Like the early universe, atoms and structures are colliding to create new structures entirely.
What digital procurement will look like in the future is something we can barely begin to imagine today.
In this Spend Matters PRO analysis I introduce the concept of “alt” suites for Procurement technology, a concept I think is already taking shape in parallel to the source-to-pay universe.
This exploration starts with asking:
- What are “alt” suites conceptually?
- Why are they forming?
- How are they different from source-to-pay (and how do they co-exist)?
- What tests do we apply to determine whether a specific “alt” suite exists?
To quote the immortal Bruce Richardson, it’s time for worlds to collide. And so they will as the following five “alt” suites emerge:
- Asses-to-Monitor (A2M)
- Spend Finance (SpendFi)
- Design for Supply (D4S)
- Strategic Spend Terminal (SST)
- Commercial Value Management (CVM)
We believe these five “alt” suites could be larger than the source-to-pay market, potentially even with long-term consolidated leaders like a SalesForce or ServiceNow in their respective markets — something that has not happened in the procurement technology market to date.
In the weeks to come, the Spend Matters team will be taking a closer look at these five areas where “alt” suites are showing the most momentum and fleshing out these concepts in more detail, examining the technology building blocks and exploring the vendors driving each.
As always, do not hesitate to reach out directly if we can be helpful in identifying technologies, evaluating vendors or analyzing opportunities and tradeoffs in these and other areas.
Gloss