Software is an interesting product because it is so different than most other “goods” we buy. The incremental price of producing copies as you grow your customer base is next-to-nothing. So, why does software for the enterprise cost so much?

Decades ago, the investment required to build the software was akin to R&D you now see pharma companies throwing down on new drug therapies with potential. So, a piece of the high-priced puzzle was to pay for the sometimes multi-year and always multi-million dollar investment required to bring a product to market.

Decades ago, without the internet as a common substitute for in-person meetings, large direct sales forces would “hunt” big businesses like “big game”. These salespeople would enjoy earnings of 200-300 to sometimes 400K or more.

Decades ago, before the rise and dominance of online advertising, marketing expenditures required to generate brand awareness resulted in yet-more high-priced spending – sometimes running into the tens of millions for a single campaign.

On top of all that, a firm’s products and technology would be so complex that employees could rarely be productive in under 6 months, regardless of their role (selling or developing). And because these firms rarely inspired a passionate employee population turnover was rampant, resulting in ongoing high-priced unproductive resources.

Unfortunately, too many old, stodgy enterprise software firms are still running their businesses as they did decades ago. They build product every few years, sell it through high-priced salespeople, take out full page ads in the New York Times & then ask their poor customers to foot the bill for their inefficiency. But not Coupa! We rail against the inefficient business models of the past and fully leverage modern technology and business practices to deliver economical solutions to our customers. It’s one of the reasons why we feel we are helping shape the future of enterprise software.

Our development tools – using Ruby on Rails – are simple and efficient, resulting in over 7 major releases in under a year. No other vendor in the Procurement space even comes close.

Our business model – relying on commercial open source – reduces costs and risks further by offering transparent access and free usage of key components of Coupa products.

Our sales approach – where prospects have direct access to the software, to free trials, to guided demos via Webex, keep costs low and value high.

And our marketing – using online advertising and a variety of other tools, redefines how to build brand awareness in a modern way.

We’re certainly not alone in running our business using these methods – there are a variety of other firms on the same journey. But we are alone in pursuing these strategies in the Procurement space – which is why we are fast becoming the most popular e-Procurement solution provider on the market.

-d