Will Eka succeed Triple Point at the top of the CM market?
I’m sure any number of companies would like to emulate the success that Triple Point Technology (TPT) had in the 2008 to 2012 time frame. Around 2007, the company began (and was ultimately successful in) establishing the “Commodity Management” or CM category of software, a new product category that leveraged a number of acquired supply chain-centric products which enabled them to reach beyond the traditional CTRM footprint and appeal to, in particular, global-scale agricultural merchants and processors. During that four year period beginning in 2008, they signed a number of deals whose license fees would have been records for almost any other vendor, including a number of deals that went well beyond $10 million in license fees; and with service revenues, reached total deal values into the several tens of million dollars. Their new client list during that period included many of the largest global ag trading and food processing companies, including Cargill, ADM and Toepfer, in addition to a number of new very large clients in energy, mining and metals.
Since the acquisition of Triple Point by ION, the company has gone pretty quiet. Apparently in keeping with ION philosophy, the new leadership has moved away from the high growth strategy that marked the “big deal” period under the previous management team. According to a few ex-employees, the company is concentrating on updating technology and developing deeper relationships with their largest customers, with the expectation that those relationships will yield additional revenue opportunities in the future. As such, they have heavily downsized their sales and marketing teams and significantly reduced their market presence. While they do still compete for new customers, they are clearly not out pushing their wares and competing for every new deal that may arise.
Given the success Triple Point had, and the fact that they were instrumental in creating a the “commodity management” or CM category, it really shouldn’t be surprising that others are looking to pick up the banner and advance it forward now that TPT has pulled to the side of the market fast-lane. Eka, in particular, has moved to establish themselves as the successor to TPT in the market that was effectively established by TPT.
While acknowledging the CM message, Eka is seeking to differentiate themselves with what the company calls “Smart Commodity Management”, a solution set that provides not only what is now “traditional” commodity management capabilities, but advances those capabilities via predictive analytics and optimization.
Though Eka has been around since 2004, they have become particularly aggressive in growing the company in the last 24 months or so. With a couple of acquisitions (Canadian-based ETRM provider Encompass and Australian-based Matrix, a supplier of mining and bulk handling software) and backed by an infusion of capital from SilverLake Kraftwerk, Manav Garg, Eka’s CEO, has been pushing forward to establish the company as the leading vendor of CM solutions.
As part of his strategy, late last year he brought in Michael Schwartz, Triple Point’s former chief marketing officer and the point person at that company who was responsible for establishing CM as a new software category. Additionally, as Triple Point shed resources after the ION acquisition, Eka hired a number of sales, support and development folks that had been responsible for successfully executing the CM strategy. And just this week, word has spread that Eka has also hired Greg Taylor, Triple Point’s former EVP of global field operations, to assume the role of president and chief operating officer of Eka. Clearly, with these hires, Eka is looking to emulate the success Triple Point enjoyed, while at the same time differentiating themselves from that company’s current offerings through the development of new technical capabilities.
Though the market for CM has softened in the last two years, Eka has announced several new deals over the few months and does appear to be gaining traction for the “smart commodity management” message. Will this early success translate into the scale of revenue and high annual growth that Triple Point enjoyed in the 2008-2012 period? That is yet to be seen; but if the market for CM does come on strong, Eka has positioned themselves to take advantage of the runway built by Triple Point…and with the hiring of some of TPT’s “chief pilots”…they could quickly take-off.
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