Spend Matters is delighted to announce the 2022 roster for our “Future 5” list. For the 4th year in a row, our analysts have highlighted five start-ups that excited them the most. These Future 5 vendors are on track to qualify for next year’s “50 Procurement Providers to Watch” list. This year, the five companies that have proven themselves as potential future trend setters are Carbmee, Focal Point, Open Envoy, ProcureWise and Relish.
To warrant such attention, these vendors must have a product that is ideally 2-to-5 years old, is used by more than five customers and displays an innovative application of technology. Moreover, these vendors must have less than $10 million in revenue and our analysts must find them both sustainable and growing with a clear momentum. In this series of articles, we explain what these vendors offer, why they are likely to become future members of our “50 Procurement Providers to Watch” and “50 Procurement Providers to Know” lists and what challenges they may face.
Today, we introduce the first of the Future 5 start-ups for 2022:
What it Does
Focal Point is a procurement department management solution that is built to replace Excel- or PowerPoint-based procurement tracking for centralization purposes. Customers laud the solution’s ease of use and time-saving features.
Focal Point houses and tracks all procurement-related activities in order to avoid manual processes. Its Intake and Triage module allows for procurement requests to be dynamically routed to the appropriate resource based on availability, skills and experience. The Execution and Collaboration module tracks individual tasks and approvals needed for project completion. Focal Point’s Procurement Performance module allows for tracking of multiple performance dimensions, moving away from a unidimensional view of procurement performance. And throughout each of its modules, Focal Point offers robust reporting capabilities that take advantage of its data sources.
Why We Chose It
We numbered Focal Point among the Future 5 for 2022 because it is a leading vendor in the emerging and rapidly growing field of procurement performance management. The solution is already a useful tool for organizations that are looking to move away from Excel as a primary hub for all procurement-related data. It is also applicable to a wide range of organizations, regardless of industry or size.
However, as Focal Point continues to expand into a full procurement department management solution that covers the entire scope of the procurement departments’ day-to-day functions, it can feasibly develop beyond a solution that is just useful for centralization and tracking purposes. Focal Point could develop into an essential tool for daily management of all procurement operations.
As the procurement performance management landscape continues to grow, leading vendors tend to hold different ideas about what an optimal five year roadmap may include. Focal Point’s vision is both innovative and realistic. If the market for procurement management solutions continues to move at its current pace, it is easy to see Focal Point as an influential vendor throughout the entire procurement software space in the near future.
Any threats or challenges ahead?
Despite positive momentum, Focal Point was only founded in 2020. So it’s very young, especially considering that the market for procurement performance management solutions itself is also nascent. As a result, one clear threat facing Focal Point is that if the development of this market does not continue the way many envision, perhaps due to economic uncertainty, it would make the provider’s more aspirational goals difficult to achieve.
Additionally, beyond high-level market concerns, Focal Point also competes against more established vendors such as Per Angusta, Acada and Cirtuo. While Focal Point’s vision of covering the entire scope of the procurement department’s day-to-day operations would be a differentiator, the solution currently lacks a truly defining differentiating feature or use case. Focal Point has, to date, astutely avoided repeating the same position as its competitors, but whether it can effectively develop its own distinguishing use case — in a market that may suffer from economic uncertainty more than a typical S2P solution — remains to be seen.
Look out for more coverage of the Spend Matters Future 5 next week when we introduce ProcureWise.
If you’d like to get under our analysts’ radar, procurement tech providers can create a free listing in the Spend Matters Almanac, the most comprehensive technology and service directory of procurement and supply chain solution providers.
If you’d like to know more about our analysts’ 50 Providers To Watch and Know methodology and selection process, join our webinar on October 31.
And if you are thinking about buying procurement technology, try consulting Spend Matters TechMatch℠ for a rapid shortlist and the free buyer’s guide resource.