The Absolute way for firms to buy efficiently

ABSOLUTE SUCCESS: Kevin Wilbur, president and founder of Absolute Commerce, is putting more than a decade of executive-level experience in e-procurement to work at his startup. / PBN PHOTO/RUPERT WHITELEY
ABSOLUTE SUCCESS: Kevin Wilbur, president and founder of Absolute Commerce, is putting more than a decade of executive-level experience in e-procurement to work at his startup. / PBN PHOTO/RUPERT WHITELEY

Procurement deals between Global 2,000 companies and their suppliers can be worth hundreds of millions of dollars and are increasingly fulfilled through software from firms such as Oracle and SAP.
But according to Kevin Wilbur, president and founder of Absolute Commerce, a Providence procurement-technology startup, as many as 74 percent of e-procurement systems do not bring back a return on investment for the company.
When the electronic systems don’t work as efficiently as they should, workers and office managers buy retail, negating the bulk-purchase discounts the company negotiated for.
With Absolute Commerce, Wilbur hopes to change that by bringing real-time merchandise and price data for business materials to the leading e-procurement systems.
“The piece that is missing right now is real-time connection between procurement and what suppliers offer,” Wilbur said.
Absolute Commerce last month raised $250,000 in financing from the state-backed Slater Technology Fund to scale up operations and release a beta version of their system later this year.
It’s a significant bet for Rhode Island’s public-venture capital firm on a company that just formed a month ago.
But Wilbur’s decade-plus, executive-level experience on both the customer and network side of e-procurement make Absolute more than your usual startup.
“It is a treat at the Slater Fund to work with someone who has that level of deep domain expertise,” said Slater Managing Partner Thorne Sparkman. “[Wilbur] has been implementing these solutions for a decade with the biggest firms in the U.S. It takes someone with that experience to find the Achilles’ heel of a system.”
The Achilles’ heel of current e-procurement systems, according to Wilbur, is that they often aren’t updated fast enough or with the proper details for employees to use them effectively. The e-procurement space Absolute Commerce operates in involves large companies who negotiate their own deeply discounted deals with suppliers for materials and equipment, from office supplies and furniture to computers – typically everything other than raw materials for manufacturing or large capital purchases.
To get exactly what workers in offices spread across the country or world need, when they need it, companies contract with an Oracle or SAP to set up an electronic ordering system that would ideally function like an internal Amazon.com.
But one of the features of e-commerce sites such as Amazon is they rapidly update with the latest products and prices, plus photos and descriptions of those products.
When employees looking to order a new piece of equipment can only find items in the procurement system from three years ago, they are likely to buy retail, costing the company money.
Of the roughly 16,000 companies that have invested in e-procurement systems, Wilbur said only 26 percent have recouped the purchase price of the systems, which themselves can cost tens of millions of dollars. Those who haven’t invested in the systems have employees still leafing through large paper catalogues to make purchases.
Wilbur’s knowledge of procurement started with GE capital, where he spent 11 years and rose to lead the company’s procurement operation.
In 2003, he left GE Capital for 170 Systems Inc., a Cambridge, Mass. firm that provided Oracle-and-SAP-integrated financial software. 170 Systems was purchased by California-based Kofax plc in 2009. Having lived in Rhode Island for the past 10 years while working in Boston, Wilbur said when he decided to start his own company, he wanted it to be in Providence. The company’s offices are in Davol Square.
Asked how Absolute Commerce’s cloud-based application can get existing e-procurement systems to provide better real-time information, Wilbur said that was the company’s “secret sauce,” but that it has to do with his knowledge of Oracle software. Absolute Commerce is a certified Oracle partner and the company’s plan is to begin selling just to Oracle platforms.
Absolute Commerce currently has five employees and, after it launches a beta version of its software, expects a full product launch by the middle of the summer.
Wilbur expects to go to the capital markets formally later in the year for further financing.
The investment in Absolute Commerce is the second from Slater this year after it put $250,000 into hospital mobile-messaging company Care Thread the first week in January.
Sparkman said Slater will likely ramp up investment when it receives the second installment of a $9 million federal grant awarded in 2011. Slater got the first $1.2 million installment last winter and has been waiting for the next $3.1 million installment.
Back at Absolute Commerce, Wilbur said he ultimately sees his applications saving money for end-user companies, while making e-procurement systems more cost-effective for a larger number of firms.
“I think it is going to change some things, save a significant amount of money, and make the systems more functional,” Wilbur said. “By doing that, it will drive behavioral changes in how things are purchased.”

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