Every year, businesses around the world spend $8.3 trillion dollars on goods and services. In order to manage this process, procurement professionals spend countless hours on the phone sourcing vendors, managing vendors, emailing (and before that mailing!) out RFPs (Requests for Proposal), and managing these RFPs to procure the highest quality services and goods at the most affordable prices. As you can imagine, this process is slow, manual, complex, and frankly, archaic.
Enter “ERP” (Enterprise Resource Planning) and “P2P” (Procure-to-Pay) solutions – these platforms began to alleviate some procurement pain points by giving organizations greater visibility into their spend. However, they don’t automate the actual procurement processes nor do nearly enough to digitize the workflow of the modern procurement professional. Furthermore, these generalist solutions are more geared towards managing the most complex and expensive procurement line items, which represent only the top 20% of transactions by volume given they represent 80% of this “$8.3T pie.” As a result, roughly 80% of the procurement transactions by volume – the high-volume, less strategic buckets of spend known as the “tail” – are largely ignored and under-optimized, creating large gaps in spend visibility and leaving billions of dollars of potential savings on the table. This is where Fairmarkit comes in.
Fairmarkit provides a seamless, automated sourcing experience by integrating with leading ERP, P2P, CRM systems such as Coupa, SAP Ariba, Oracle, Workday, ServiceNow, Salesforce, and more, to ingest a customer’s purchase and vendor data, into their own proprietary vendor database. Next, Fairmarkit automatically populates request fields from “RFxs” (Requests for Proposals, Quotes, Services, etc.) or enables procurement professionals to build them from scratch in minutes. Then, Fairmarkit’s AI proactively recommends the best vendors for each RFx, automatically sends out invitations to vendors and collects bids, and provides a single pane of glass for the procurement professional to award the winning bids. But that’s not all! Behind the scenes Fairmarkit is collecting and analyzing all the vendor bid and performance data to make their recommendations better over time. Finally, Fairmarkit outputs management-friendly dashboards and pushes back all data into the ERP or P2P systems for a single source of truth. Ultimately, Fairmarkit frees up procurement professionals by allowing them to spend more time on strategic initiatives, drives more granular visibility into enterprise spend, and unearths hidden savings.
As for our partnership with Fairmarkit, this $30M Series B investment marks an exciting milestone in a several-year-long relationship with the Fairmarkit management team. We spoke with CEO Kevin Frechette back in the summer of 2018, but the business was a bit early for an Insight #ScaleUp investment, so we stayed close and circled back down the road. Come summer 2019 we met with Kevin and COO/co-founder Tarek Alaruri in person for the first time and we were quickly impressed by the young, scrappy, sales-oriented founders who had managed to build a mature organization. Their tenacity, momentum, and “sales-machine-of-a-business” gave us the confidence to do something we normally don’t – by October 2019 we were excited to announce our $11M Series A in Fairmarkit.
Since our initial investment, Fairmarkit has continued to scale rapidly, earning recognition from IDC Innovator, CPO Strategy, Future 50 Spend Matters Almanac, Future of Sourcing Awards, and others, while most recently winning the title of #1 Source-to-Pay solution at DPW 2020. As we double down on Fairmarkit’s Series B today alongside GGV Capital, we are more excited about Fairmarkit than ever, as their truly automated procurement solution drives significant time savings, visibility, and most importantly, cost savings, for the cash-conscious enterprise market.