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Market Invoice has received more funding and been valued at £85m. So there are investors out who still believe there is potential in this sector.
Interestingly, Market Invoice has funded invoices for suppliers who sent them via the Tungsten network. Says a lot of Tungsten and it’s ability to deliver.
Maybe. The way I read it is they've been cutting costs to hit the ebitda positive claim they made last year. But, this tech drive they've been on for 2 years hasn't delivered. How much money have they spent/wasted? What is the remit for the new guy? Is it to deliver this tech or is it to cull it? The former means more investment, the latter means they've not got what they needed to move forward. More important though is the fact they need new invoicing Buyers. They've brought in hardly any new business in this area for years. What happens if they lose any business?
65? That is optimistic. The dream they floated with died a while ago. They've tried new services but all have failed to take off. What remains are the re-branded companies: OB10 and Docusphere. Their increased revenues have been largely off the back of increasing prices, masking their failure to generate enough new business. Now, rightly, they are trying to cost-cut but they've just had to fire the CTO who was supposedly delivering the technology to allow for the savings. To me, they need new Buyer e-invoicing deals and fast. Given they've had hardly any in the last 4 years I don't hold out much hope.
Will this new analytics service really provide enough of a benefit to the supplier? Remember, Tungsten only processes some of the invoices for a Supplier. Doesn't this service offering have the same limitations in that it can only paint part of a picture?
@Warthog4 Highly paid? I think that is undisputed. Jokers? Well, let's look at the evidence. - Growth: The true electronic invoicing network isn't growing. Suppliers and transactions have increased but this is based on Invoice Status and Invoice Data Capture (so paper invoices re-keyed in). - New services: Unfortunately none have worked as yet. - Technology: They've just let the CTO go having seemingly not delivered and burnt through a lot of cash. - Managing costs: They seem to have done a decent job here. If you think they're jokers then I'd say that answers the question.
Standard contracts, surely that's a pricing strategy isn't it? Wasn't this one of Mr Truell's initiatives because there were too many bespoke offers? Makes sense if they dropped pricing it would drive an increase. I knew they were working on the platform but didn't know it had been delivered. The glassdoorers are clearly wrong. Re-writing a platform isn't that hard but implementing it in a frictionless way (tungsten buzz word) is a real challenge, especially when you're potentially impacting so many customers. I can't believe they've not been shouting about it, given the tech direction and delivery has been having such bad press. But, I see that will help with costs and efficiency. Not sure the tangible benefits to suppliers though or why it would result in such an increase in new customers.
BS76 You stated the new suppliers were because of the new technology. I simply asked what this was as you seem to know more about it than I do. What Tungsten is clearly doing is streamlining and moving a lot of their infrastructure to more cost effective cloud based providers. That's entirely sensible but what I don't see is this new tech that has caused this ramp up. So, in answer to your question I don't know but I'd like to find out......hence why I asked! The negativity is because so much is questionable it really does make you lean more towards Shortsupply and the smoke and mirror theory. For example, take the explanation of the supplier base from the report: "251,000 suppliers using Tungsten Network for a combination of delivering invoices to their customers, tracking the status of their invoices and having their invoices digitised using our Invoice Data Capture product". Invoice status is a free service. Maybe the new tech you are talking about is the Invoice Data Capture product but this doesn't involve the suppliers directly nor generate supplier revenue. Both can increase supplier numbers and both distort the perception of growth. On the buyer side you quoted 10 buyers. However, only 5 were e-invoicing so that is actually a poor return when you are looking at the e-invoicing business. You and K3VMC are super positive. You read the numbers and see the positives. For others, well we've been burnt and there isn't enough information to remove the doubt.
BS76 What exactly has Tungsten implemented to help increase the number of suppliers on the network? I'd love to know because it can't be the additional services because they aren't delivering. As for the IT, I've not heard of anything that has been delivered. Obviously we have to be weary of GlassDoor or any comment from a former employee but when they are saying they've not even implemented Sales force after 2 years, I see that as a warning sign. IT investment was one of they key areas to Mr Williams' EBITDA claim yet they have a stream of contractors........doesn't sound like a business in control of their delivery or their cash burn. As for growth, I never just believe what is being said, you have to dig deeper. The problem with their supplier growth is that it is hidden in mystery and has been for as long as I can remember. Others have pointed out the short comings in their reporting. It raises a lot of questions and they are never answered. How many of their suppliers are actually transacting? How many have actually paid money to Tungsten in the last 12 months? How many have true recurring revenues rather than front loaded up fees? In fact, they do the same with their Buyers too. A long time ago someone highlighted the difference between a workflow buyer and a true e-invoicing buyer. The revenue difference is massive but then so is the nature of the Buyer deal and how many invoices would potentially go through Tungsten. So just reporting X buyers doesn't cut it for me. I need to know more to invest. K3VMC India does have potential, but then so does Mexico and Brazil....how well have Tungsten done there? They've long been promoting strong compliance as a USP and that's fair. But was that down to their compliance staff or their systems? If it is the former than that's a worry as they've lost their 2 experts in this field to competitors. If it is the latter then that's a worry because their experienced IT staff have all left too. If Tungsten are to build something new then there is nothing to suggest a competitor can't do the same. Cost cutting is key to Williams' plan so clearly there will be redundancies, moving or closing of offices etc. I've no problem with that but Hurwitz said they had ageing systems. So their plan seems to be to have new systems, built by people with no e-invoicing experience and run by staff with no e-invoicing experience. The cash is burning and the expertise is draining but you still see the positives. Good luck to you.
Glassdoor on its own is largely just a place for former employees to vent frustration. A lot of it is just the view of one person. Does anyone really care one of the exec team having an affair or whether the fussball table has been taken away, of course not, especially HP, Siemens etc. However, if you bother to do some real research you'll learn, for Tungsten, there is some truth in what these people are saying so don't take all of it with a pinch of salt. Mr Williams can go EBITDA anytime he likes........come on, it was funny to start with but the joke is wearing thin now? There is no evidence of this and their "progress" is worse than the loss making OB10 days. The competition is mile ahead (many investing in former Tungsten staff) while. What has Tungsten done? How are all those additional services going? What about that IT investment from 2 years ago?
Well it came across as though you were blaming them but apologies if not. Having the ability to operate in India is clearly a good thing. Only time will tell whether the costs were worth it. So they have re-written the technology and deployed it? I've not seen any notices on this. Surely that's something they'd want to tell people, especially their customers. Personally I'd be very surprised if this is the case. Bit of vaporware me thinks.
K2VMC, Oh I wouldn't be surprised if it is millions. I just hadn't seen anything so was curious if I'd missed any updates. Equally, I'm not necessarily criticising the management. However, I do see the validity and justification in what Warthog4 was saying given the lack of progress. Yes, the previous management weren't great, but blaming failings on them must be wearing thin. After all, Rick has been in place for 18 months and only 1 month after the press release Burnt posted earlier. Also, let's not forget, he worked for Tungsten in a key management role prior to that. Of the rest of the management team, Brian Proffitt has had 18 months but granted, Guy Miller, Connie O'Brien and Prabhat Vira have just the 12. However, David Williams came in during the Tungsten buy out and Patrick Clark, Ruud van Hilten and Alec Holmes are all OB10 lifers. So, I take the blame it on the previous team with a pinch of salt We're not on the inside so we don't know what is going on. Yes, we can praise this team, or we can say they've benefited from previous teams' idea and groundwork. Either way, this is undoubtedly a good opportunity for Tungsten and it's great they've got it over the line. Reality is, we all want are positive results and given we've not seen many of those it's understandable if others start questioning and want to look behind the curtain.
"they spent millions on breaking into the Indian market". How do you know? Plus, isn't that statement kind of at the heart of what Warthog4 was saying? It seems like they spend millions in a lot of areas, often with very little results. I think someone questioning the management team is justified. Those questions are then countered by positive moves/results and hopefully this turns is one of those, rather than the usual press release from the "digital command centre".......still makes me chuckle. But, before we bang the Hurwitz drum, we are still waiting for news about FX, Analytics and Finance.
@hmmmmm I think the BoD had no choice. He wasn't acting in the interests of the shareholders. The markets they arr in are tougher than suggested however I agree they have performed poorly. Their updates are full of holes and I dont see progress. Their is also no positive news coming out. I question how @K3VMC can have such faith and be independent. However, I hope he is and he is proved right. Hopefully it is a still a slow burner. 6 months and we know.
@Burnt I'm with you on this but from what I read, he's has no real technical knowledge he's more of a figure head. This would be fine except it seems his chief architect has now left. Whilst they need to cut costs, given their progress is reliant on technology, when you add it to the rest over the last 18 months this isnt ideal. Where I am struggling is in seeing a growing business. They sold about the same number of IS customers as they did last year....and it wasn't great then. They are actually performing worse than in the OB10 days. Their Buyer revenue looks like it is pretty much just renewals on increased pricing. I disagree with @K3VMC. Buyers will move, especially for a better service. As you suggest, their finance offering has seen little penetration in 6 months. The light here is the fact Mr Vira is changing the scope. By doing this they are proving their financing usp is fruitless. Now they are just looking to compete with everyone else. A bold move, a logical move but it will be tough going. The Payoneer deal clearly had no early adopters but it was only 5 weeks so no time to judge. But, lets not forget, this too is a competitive market but at least it is another stream. Ive seen IDC mentioned recently too. They've had this for years. There is no information on what they have changed to trigger greater revenues. So, personally I wouldn't rely on that until we find out more. This could just be window dressing. Analytics has generated nothing in 2 years beyond the costs and has been dud. For me, the numbers dont point to a growing, thriving business. What I see is a business who is shrinking its way to success. 50p seems about right to me. As you say @Burnt, we are pretty much back to OB10 and that was sold way over price. Rick clearly knows all this and it's good he's looking at new services. It has to be the only option because I cannot see them being a success on just e-invoicing.
@hmmmm I don't think it's a hugely expensive command centre. It's got be a comical description for a couple of people who just send out press releases. @burnt Keeping faith looks the right way to go here but the half year results are important. The thin finance announcement suggests to me they've had no traction with the current solution and that is still disappointing. The timing of their new service, just before the half year results is very convenient. Is it buying more time or just a coincidence? Either way, end of year results will be the proof. Hopefully this version gets things moving. Personally, I think their Analytics solution will prove to be a dud. They've had a good 2 year run flogging this. However, their change of strategy gave them more time and surely we should expect to know if this is ever going to be used in these half year results. Therefore, this an important update. The half year results should also show some kind of indicator for the FX service. Yes it's early days and I agree the end of year should be the true metric but I feel they must have some traction. We'll also find out how they are getting on with invoicing. The OB10 crowd proved you could get sales and steady growth. However, the people I've spoken to say none of the key people are left. Everyone single one of note has left. The worry is whether the new blood and the ones who have remained can they kick things on. Given the target to reduce costs as well, it's a big challenge for that team. You make a good point on their tech. Given their 15 month plan plus whatever Prabhat had added, it seems like it's going to have been a costly half year with more to come. I like what Rick has been sayng and his recruitment of Prabhat seems a smart move. However, I'm not sure on this CTO. He seems to be more marketing than tech. Plus, his reputation doesn't fill me with confidence when you're responsible for leading a tech overhaul. He was part time too (not sure if he still is). They must be starting to reap some of the benefits of the tech though. It will be interesting to see the impact it is making.
Digital command centre......hahahahahahaha that has made me chuckle.
Hmmm. I just asked myself, is there anything to be excited about here? I think so but it's hard work to get there. The flexible service they were offering is now more flexible??? Why haven't that said what changes they have actually made? Surely a missed opportunity here. If you're of a pessimistic mindset then it reads like they've changed very little barring a reduction in the price. Personally, I can't believe someone as experienced as Prabhat has come in and then, after months of review has simply said lower the price. They need to take a look at the person doing their comms. This is a weak update. But, with my positive hat on they are clearly not just focusing on invoicing and are making changes. If they can get real traction then maybe, just maybe.... @BS76 Tungsten confirmed, via a very nice support person there was a problem on the corporate website and then notified me when it was resolved. I'Lloyd cancel that Internet upgrade!
The link doesn't work for me either! My techy guy is suggesting they had a problem or changed something with Easy Space. If some people can access it then it could be they work for Tungsten and access the site through a different route or the issue is resolved but taking a while to propagate across to all the servers.
Thanks @BS76. I can't speak for the others but I have read the reports and this previous posting. The point I was making (and I believe the others too) is these figures are misleading and lead to more questions. We are merely looking for clarity. This removes doubt and allows us all to more accurately assess our investment. We all need to know if we are still backing Tungsten and its mix of complimentary services, or Tungsten the e-invoicing company. Hopefully the former.
@Burnt, I simplified those figures because the ones @shortsupply stated can still be misleading. There is a type of supplier who gets 50 free invoices every year. So, if they only send 50 or less in a year, then they don't generate any revenue. Whilst these may generate revenue in later years they aren't today. Active suppliers only interest me right now if they are generating revenue. Given the poor performance of the other parts of the business, they need to show an accurate and clear indicator they are growing the e-invoicing business and reducing costs. This will generate the confidence needed.