More Businesses Seek Help Purchasing, Managing Software — a Top 5 Expenditure

For most companies, technology is a top-five line item on a profit and loss (P&L) statement; for many, it’s in the top two. And software is accounting for an ever-growing portion of that spending.

“Every company in the world is — for the most part — becoming increasingly reliant on software, and I actually think that’s a great thing because it’s a massive lever for businesses,” Vendr CEO Ryan Neu told PYMNTS when sharing that data. “Now, there’s a host of challenges that come with that.”

For one thing, companies must make decisions on where to invest during a time of talent shortages, rising inflation and market volatility, Neu said. Another challenge is the increasing cost associated with the software on which companies rely.

Neu founded Vendr, a Software-as-a-Service (SaaS) buying platform, three years ago to help companies save the time and money they were spending trying to figure out how to buy software. That allows procurement professionals, for example, to focus on strategic sourcing rather than dealing with 500 SaaS applications.

“SaaS overloads the business because of the sheer quantity of products in use,” Neu said.

Combining SaaS Buying With SaaS Management

As Vendr grew rapidly while providing that service, customers started asking for help with spend visibility and spend tracking.

The company announced Feb. 23 that it had acquired SaaS management platform Blissfully. Together, the firms will provide customers with a single solution to buy and manage SaaS applications.

“Internally, we said it was like a ‘one plus one equals three’ because it completes the life cycle that our customers had been asking for,” Neu said.

SaaS management helps companies understand what they own, whether it’s being used and whether it’s still needed. It also helps them cope with the complexities of SaaS spend such as “shadow IT” — including software that employees bought themselves and known software spending hidden in the general ledger.

“When we say ‘visibility,’ we’re talking about getting clarity on both of those so you can have a complete picture on what is in use at the company,” Neu said. “You can’t really start saving money until you know what’s there.”

Empowering Better Buying Decisions

Now bundling SaaS management and SaaS buying, Vendr offers the package at a price based on percentage of spend in the client’s company. This ranges from 1% to 5% with the lower the spend, the higher the percentage. The company offers a money-back guarantee that it will save clients more than it costs.

“It is hard times for tech companies right now, especially startups, and everyone right now is paying attention to cash burn,” Neu said. “When your technology expense is on the rise, what do you do? You need a way to bring that down, and we believe the answer to bring it down is Vendr.”

Now that the company helps buy SaaS and manage SaaS, Vendr is looking next to add the ability to find SaaS. This “discovery bucket” includes understanding what a company currently owns and doesn’t own, as well as delivering insights on the SaaS that other, similar companies are using to gain a competitive advantage.

“We want to empower better buying decisions, and that becomes a pretty core focus of ours over the next 12 to 24 months,” Neu said.