ProcureTechSTARS caught up with Tom Howsam, CEO and Natasha Foster COO, the founders of Paid, the next-generation procurement automation platform.
During the conversation, Tom and Natasha shared their thoughts on being a conduit for commerce, long tails, remote-first, Apple Homepad, Lumen and pisco sours.
1. What is Paid‘s mission and USP?
“Paid’s USP and mission is to create equal
opportunities for businesses of all sizes, all around the world.”
There’s the mission of finding a place to start from and then expanding. We help the large enterprises work with smaller suppliers – you can see it as an effective modern enabler for commerce, where large companies can get access to innovation and agility, and smaller companies can get access to economic strength from working with the biggest companies.
“There’s a big enablement vision to effectively become the conduit for commerce”
… which takes away all the frustrations, bottlenecks and inefficiencies when we currently buy goods and services from each other.
2. What have been the most significant decisions or milestones in Paid‘s journey?
When we started Paid in 2018, our focus was to originally help smaller suppliers do better business by trying to give them the tools that would help predict their cash flow such as workflow automation for onboarding contracting and payments to do business with any sized client in a good and predictable way.
We then went through the Barclays London external accelerator powered by TechStars, and realized during the programme where we had an opportunity to talk to a number of large corporates and procurement professionals, that larger buyers really struggle to work with their smaller suppliers – their procurement processes are often complex and are largely manual. This means
“the onboarding process of managing and paying those
smaller suppliers is disproportionately costly for those buyers.”
We did some research and realised it’s an endemic problem across large buyers and we knew that if we tweaked our software to allow enterprises to use it to manage their smaller suppliers, rather than suppliers using it to manage their clients, we could help a really vast number of suppliers in a short period of time because we’d have access to the 1000s of suppliers that large buyers work with. We really liked the idea of helping both sides of the business transaction and knew we could work really easily with enterprises to help them.
It took us about 6 months from when we decided we were going to do that through the research and tweaking the product, but we soon developed the enterprise side of the software. We were then ready to start piloting it with clients in January 2020 and we haven’t looked back since!
3. What do you look for in the perfect customer?
Things have changed quite significantly because initially we were targeting small suppliers, and when we started thinking about enterprises, we asked ourselves, ‘what size of enterprise could get the most value from what we’re providing?’ which is a software to help manage long tail suppliers.
Through our research, it became clear that the larger the enterprise, usually the larger the pain point for them because they have the most long tail suppliers, and often, although this is not always the case, they have incumbent, long standing ERP systems that had perhaps been bespoke developed for them and that involved a number of manual interventions still. As a result of their need for compliance and risk taking, they had quite complex processes for supplier onboarding and management.
The kind of clients we now work with are very large enterprises that spend tens to hundreds of millions with their long tail, such as smaller suppliers and one-off or infrequent suppliers. Often, that is services based, although we can do both goods and services, and purchasing that’s not necessarily very commoditized. We help automate the process that they go through…we take their existing processes, and we automate that process through our software and layer it on top of their existing ERP or P2P software.
4. Are there any particular regions or industries or areas that you were looking at to start off with?
“the problem is endemic across all large enterprises… everyone we speak to seems to have the same problem.”
However, we have done a process to narrow down our focus for now on the areas that based on a number of criteria would get the most value from our software. For example, facilities management companies or insurance companies that cover home repair, telecoms, media, energy and utilities as well. Those are our current target industries by virtue of the nature of their long tail.
5. What are the foundations of a great team?
Our team has been building software platforms for many years so the technology isn’t necessarily the limiting factor, but it’s the deep understanding of the domain.
“Having the A-team together to solve this problem helped us tackle the problem point.”
Natasha and I hadn’t worked in a procurement department of a large enterprise so we brought in a fantastic guy called Paul Smith who is now helping us with direct experience of working in those teams and also digital transformation initiatives. To complement what we’ve been doing, we brought in someone who was used to selling to those types of companies as well, because for new enterprise salespeople like Natasha and I, that process can be quite daunting in terms of how you interact and what you’re supposed to ask at the right points. Our software is a complex sell in itself as it has an implication to procurement, finance and to the external relationship. So we brought in an experienced enterprise salesperson who’s got many years in doing these types of ERP accounting software type deals to help us navigate that space and really complement Natasha and I in the engineering/technology aspects of the team.
6. As we emerge from COVID, what will you be doing differently?
From an internal culture perspective, we feel very lucky because we were already a remote first company when COVID hit, so we had the infrastructure and tools in place to support our team through the lockdowns. We used to meet up in person quite frequently, so everyone’s still missed seeing each other in person.
As we come out of these periods of lockdowns and social distancing, we have in place a structured return to in person meetups, which I think we all feel quite excited about, but we will maintain our remote first team structure. Everyone is keen see each other in person!
“From a business perspective, we’re really excited to help our current and new clients and to be well positioned for the new way of working that seems to be emerging.”
The software that we provide is the kind of solution that procurement teams can use on the go, on mobiles and by email which doesn’t need to be on premise. There is no VPN involved, so it allows them to be flexible and to keep their buying processes efficient.
Everyone has had their supply chain shaken. We’ve definitely seen a drive in the clients that we work, whether or not they just want to be good citizens and spread more work between small suppliers and spread the wealth of it. Some existing suppliers just aren’t quick enough for them, so there is this need for agility and ability to move fast, as waiting 3 months to onboard a supplier is no longer an option.
7. What is the vision for Paid in the future? What are going to be the most important things you put in place to make sure you achieve it?
We talked about the mission at the beginning and creating equal opportunities for businesses of all sizes all over the world and being a conduit for commerce.
Now, if you think about the bigger vision, commerce just doesn’t start and end with onboarding. You’ve gained a piece of work with many things associated, such as compliance, insurance, a network that’s building this to allow commerce to happen efficiently across multiple categories and all different types of suppliers.
We’ve been working quite hard on our vision for the data that we’re generating inside of a business…we think we can demystify the tail end for our clients and offer savings, by using the data in a non-traditional way. Offering real-time enablement of activity and actions based on the data that’s on the platform, and we think we are in a unique place for data capture too.
We know we have to build the team around us and make sure that we have the right skill sets in place. We have some very supportive investors, so we’re just looking forward to cracking on and developing and executing on that vision.
8. How is Paid doing good for the planet?
When thinking about the supply chain and an enterprise, you could start to think about offset type products being automatically applied to purchasing via an API or assistance system type way so it’s all automated.
Then there’s the view of spending more money with your regional or local suppliers and so there are fewer emissions from cars and less commuting of goods and services.
Our clients’ impact and ability to now spend money with small suppliers in a very quick way means that they can spread their wealth and potentially choose suppliers that have strong eco credentials, and not worry about the onboarding and the work side of things because that’s going to happen in a very seamless way through our platform.
We’re seeing that right now with our clients, we’ve got a specific example of someone who’s working in a very tight geographic area and wanting specifically to spend money in that area. They are a 300,000 person, multi-billion company, but they want to spend money in this specific location. These businesses wouldn’t have got contracts, if Paid wasn’t in place because it would have been too difficult to get them on through the traditional arrangement.
In terms carbon off-setting options, we haven’t integrated any platforms in but we are building a platform that has the capability to plug-in, whether it be third party compliance services, or offsetting products or insurance products; the capability will be there for us in the platform within the next 12 months to enable those types of complex arrangements.
INSTANT TOM & NATASHA INSPIRATION
1. What is your favourite book or blog and why?
Fred Wilson is a partner at Union Square Ventures in New York. He writes every single day, a short piece that he publishes and sends out via email. He’s got so much experience and I love how succinct everything he writes is, so I’ve had lots of gems from that.
The Trillion Dollar Coach. It’s a classic business book based on a true story of a Silicon Valley coach, Bill Campbell, who coached Bezos, Steve Jobs and the Google founders over the last 20 years. Unfortunately, he died but the people he had coached wanted to encapsulate his knowledge and created a book that passes on their learnings and how to work with these types of leaders.
2. Who is your favourite inspirational leader and why?
Arianna Huffington. She’s been fantastically successful in a number of careers, but I like that she uses her influence to drive agendas that she really cares about. She founded Thrive Global, which is all about well-being, whether general, in the workplace, mental health, how to avoid burnout and how to be successful without losing yourself.
The F1 manager Toto Wolff. Formula One is the epitome of teamwork, but with a stopwatch, there’s nowhere to hide. I think his leadership style of radical candour, honesty, and the fact that they win and lose as a team is based on the fact there isn’t a blame culture inside Mercedes.
3. What’s your favourite app or piece of technology?
I’m a hardcore Apple user! Everything I own is Apple. I love the HomePod, which has completely revolutionised my life…it answers all my questions, runs timers for me and organises my music.
I’m also an Apple fan, but I bought a device it’s called the Lumen. It’s effectively bringing what was cutting edge science 5-10 years ago that you needed to be in a lab for into your home. If you’re into sports and exercise, it analyses the CO2 in your lungs and it tells you if you’re burning fats or carbs and what you should eat next.
4. What’s your favourite way to celebrate success?
Tom has a bar!
[Tom turns camera around to reveal an array of dazzling drinks and a bar cabinet]
Tom and I both enjoy a nice restaurant. If it’s just the two of us or we’re with the wider team as well as we go out for a nice meal.
5. What’s your favourite cocktail?
It depends, but probably a Pisco Sour, but I also love whiskey.
Pisco Sour is my favourite too!
1. Pivot quickly to where the biggest problem and market is.
2. Automate processes to simply and reduce complexity.
3. Assemble the A team to compliment your skills and solve the specific problem.
4. Embed agility and adaptability into your supply base.
5. Help clients to implement and adopt new ways of working, especially after COVID.
6. Accessing and converting unique data points provides an opportunity to identify savings.
7. Future proof your digital platforms by considering sustainability challenges and integration requirements.
Paid is on a mission is to create equal opportunity for businesses of all sizes, all over the world. Large companies will gain agility and innovation capability while smaller companies will gain economic strength and access to wider business opportunities. Paid is a next-generation procurement automation platform, for both buyers and suppliers, that transforms the procure-to-pay process to make it easier and faster for everyone. We believe that business is about people, not process. Relationships will always matter most. We believe that software solutions should just work. The experience should be simple, purposeful and powerful. We believe that we can help smaller businesses thrive and the biggest businesses innovate and move quickly.
Our industry is moving forward faster and faster, empowered by innovative, progressive digital procurement solutions created and led by inspiring teams. ProcureTechSTARS are the digital procurement company CEOs and Founders that are leading the change, they are entrepreneurs, engineers and architects collaborating to transform procurement and the enterprise. In an open conversation with these leaders Lance Younger will be discussing the highs and lows of building the future now, the challenges they’ve faced, their perspective on accelerators and hot topics, and what keeps getting them up in the morning (and keeps them up at night).