Running a company is expensive. And it’s more than just the product and employee costs that add up.
From furniture to electronics, there’s a lot of day-to-day corporate spending that can be hard to keep tabs on. That’s why procurement software has become a big business.
Investors are betting that Scout RFP will emerge as a leader in the space. Menlo Ventures is leading a $15.5 million Series B round in the company, with participation from NEA. Matt Murphy from Menlo is also joining the board.
“Procurement departments all over the world are run on spreadsheets,” CEO Alex Yakubovich told TechCrunch. Scout’s goal is to “automate the sourcing process.”
Clients range from Smucker’s to Salesforce and they pay for Scout on a subscription basis. In addition to spend management, Scout can help find discounts for buying in bulk. They call it “reverse auctions,” where suppliers compete on price to entice customers.
Murphy says Menlo invested in Scout because it’s unlike the competition. “It’s an adjacent category that is different and has been neglected by technology providers.” He feels that Ariba and Coupa “have a forced fit offering that is clumsily based on their standard product work flow and rarely used.”
Scout will ultimately “bring visibility for tracking all the projects that are going on,” said Yakubovich. It’s efficient to have just “one system of record for procurement and sourcing.”
Scout is headquartered in San Francisco and has 42 employees. The company previously raised about $12 million from NEA and Google Ventures (GV).