Coupa will launch an on-demand e-procurement software suite on Monday that is built on Amazon's Elastic Compute Cloud Web service.
For those keeping score at home that makes the Coupa suite an on-demand service running on an on-demand service. The launch also makes Coupa one of Amazon's early corporate customers building a product on the e-tailer's cloud infrastructure services.
E-procurement is a niche that flies under the radar, but can cost companies a bundle in IT systems and productivity. Coupa aims to automate purchasing processes and all of the requisitions, approvals, purchase orders, quotes, receiving, inventory checks and inventory that goes with them.
Coupa, which competes on the high end with companies like Ariba and Ketera, uses software as a service to deliver its applications, which are built on open source. The e-procurement system announced Monday is targeted toward small and midsized companies. The pricing varies, but $2,495 annual subscription will cover 10 users at a small company. Coupa also includes other perks such as an expert to help companies collect the data they need to get up and running quickly, say a week.
Here's a look at Coupa's pricing plans:
Aside from pricing, Coupa CEO Dave Stephens is hoping ease of use and Web 2.0 technologies will win over customers. The system resembles any other shopping experience at Amazon. Coupa has also linked up Data Dimension, Dell, Invitrogen, Office Depot, OfficeMax, and VWR International to connect customers with supply vendors. A feature called PunchOut allows you to toggle between the Coupa and partner sites while keeping things like purchasing approvals in your shopping cart.
But what's under the hood of Coupa's system (previous post and gallery) is notable. Stephens said that Coupa was using Amazon's S3 storage service data backups and then began experimenting with the etailer's Elastic Compute Cloud (EC2) service for demonstrations of the e-procurement system. Another tie: Andy Jassy, senior vice president of Amazon Web services is on Coupa's board. As Coupa rolled the e-procurement system out to early adopters--such as Cambridge College, Canatxx and Cequent Pharmaceuticals--Stephens stuck with the EC2 foundation.
"We used Amazon for the on demand service and all it all fell together," says Stephens. "EC2 surpassed any other offering we experimented with."
Here's a look at how Coupa plugs in with Amazon's EC2:
It also didn't hurt that Coupa could scale up its infrastructure without a hefty upfront investment. Meanwhile, Amazon's automation allows Coupa to increase its computing horsepower as needed. Coupa customers don't see any signs that the entire service runs on Amazon's bank of servers. "It's transparent to the customer, but the service runs in an Amazon data center," explains Stephens. "It gives customers a piece of mind."
I can understand the piece of mind issue. Who are you going to trust Amazon's cloud or a young startup's? For instance, NetSuite noted in an SEC filing that it has one data center. If I'm a customer subscribing to a SaaS service I'm heavily focused on where my data is stored. At this juncture, I'd be more trusting of Amazon's cloud than Coupa's.
The only potential hitch: Amazon's Web services don't have five 9 uptime. Amazon recently rolled out service level agreements guaranteeing 99.9 percent uptime. Enterprise class uptime is 99.999 percent.
Stephens acknowledged the concern, but added that Coupa hasn't experienced any outages using Amazon's infrastructure. That said, Stephens is encouraged by Amazon's SLAs because they offer a piece of mind. After all, cloud computing can raise trust issues relative to an internal data center.
The Coupa CEO reckoned that Amazon's SLAs are a necessary to get more businesses on board with its services. The SLAs also show Amazon's services are maturing. "We're encouraged by Amazon's SLAs. Issuing an SLA is a step in the right direction," said Stephens.