When you’re No. 2, you try harder, according to the old rental car company ad. David Barrett, founder and CEO of travel and expense management service Expensify, says he’s taken that to heart with the acquisition of market leader Concur Solutions by enterprise resource planning giant SAP AG.
The $8.3-billion takeover is the largest in dollar terms in the history of software-as-a-service companies, according to Tomasz Tunguz of Redpoint Ventures.
In an attempt to capitalize on takeover uncertainty, Expensify is offering Concur customers free service for the duration of their contracts with Concur.
“If that’s one year, 10 years, or 1,000 years–no problem,” Barrett wrote in a statement. He said he’s addressing the biggest C-level concern about switching expense management providers: sunk cost. With long contracts and extensive integration on the back end, it’s a large investment to throw away.
That’s only one prong of the Expensify attack to lure away Concur customers. Expensify has “whipped up” a function that allows end users to submit their expense reports to their companies’ Concur back ends through Expensify’s mobile app, Barrett said–also free of charge. Expensify uses the Concur application programming interface (API) to connect to the enterprise system and create reports in Concur. Barrett calls this a “bottom-up” adoption model; even if the company won’t switch to Expensify because of sunk costs, users will.
“Even if they’re not paying us, I’d rather they were using us than not,” Barrett wrote.
Expensify’s SmartScan technology allows users to take a picture of a receipt and upload it for processing; users are reimbursed directly through their bank accounts. Expensify claims 2 million users and 300,000 companies as customers, mostly small and mid-sized businesses. Concur claims 15 million users.
Expensify recently inked a deal with taxi provider Uber, using Uber’s SmartRides API to deliver push notifications to travellers asking if they need transportation when their planes land. Last year, Expensify added a feature to update users on the status of flights they had booked and hotel reservations.