More Supply Chain Deals: Intrigo-Califta, Mercator-Catapult, Marlin-IBS
on Jul 21, 2015
The summer may not have been very hot, but hot tech deals are still plentiful.
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Ripples in the Rating TM Market
Rating is an unrated, yet a totally relied upon, capability in the TM ecosphere. Rates are reviewed, complained about, negotiated and ‘repriced’ everyday—every second—in the logistics world. Rating engines are critically important and there are only a few of what ChainLink calls Neutral Rating Engines1 (see Figure 1). SMC3 in North American ground transportation, and CargoSphere and Catapult in ocean are a few that come to mind. Integrating directly with soooooooo many carriers and keeping track of daily rate changes is a huge job.
Thus, it was more than a ripple in the ocean when Mercator announced their acquisition of US-based Catapult this month. Mercator, for those who don’t know them, is a spin-out of the United Arab Emirates; they had a large IT shop and developed a multi-carrier air cargo software platform. Underwritten by Warburg Pincus,2 Mercator has a mandate to grow a global multiple-modal TTL (transportation, travel and logistics) ‘family.’ David Tibble, CEO of Mercator, told ChainLink, “Mercator has sought a strategic platform that truly allows for the right extension into the ocean and ground carrier markets for a while now, and Catapult is key to our strategy of optimizing critical transportation processes through an unparalleled combination of technology, business process outsourcing, analytics, and data management. The addition of Catapult’s solution set will enable enterprises to make smarter, real-time decisions at that point in the transportation lifecycle where accurate and fast quotations can make the difference between profit and loss on a shipment.”
Figure 1: Neutral Rating Sector
The rating engine segment has been on the rise, floating up with the growth of the cloud TM market. Shippers’/importers’/exporters’ increasing challenge of managing the growing expense of shipping rates due to carrier cost dynamics—the ever-changing expenses incurred from labor rates, fuel costs, changing tolls, port fees, delays, wait times, etc.—keep rates dynamic. Both the buyer and the seller are looking for advantageous pricing. Smarter math is now required to find that win-win.3 In fact, lack of consistency and auditability of rates is the largest customer service issue for the big ocean carriers. Invoices just don’t match quoted rates/contracts.
The Catapult acquisition is a smart move for Mercator—a vector into the huge ocean cargo market with connections to freight forwarders, shippers, and carriers, all in one acquisition. The Mercator team told us, “Integration into other platforms is key for Catapult as customers require information to flow into their ERP or TMS systems. Catapult has built very strong and secured APIs that will transfer specific rate information over to systems so that it eliminates double key entry on the customer side. …The connection with INTTRA can help Catapult’s customers book containers with the steamship lines. And now the partnership with Mercator envisions doing the same on the airline side.”
Catapult is one of those US ‘we started in garage’ success stories and is one of the fastest growing technology companies in the transportation management sector. Catapult’s solutions are used by more than 25,000 companies today with over a billion rates in their database. The acquisition is a first step in achieving Mercator’s vision to leverage its aviation heritage across the TTL market. And for the ocean/TM market we can expect more from Catapult. As Dave Tibble continued, “It is Mercator’s vision to invest heavily into Catapult’s infrastructure and product development, which will make its products and services more robust. Catapult will be able to quickly bring solutions to market, increasing the number and depth of its products and services. The company will be able to respond more quickly to market changes and take customer service to the next level.”
Commercialization of Consulting—Intrigo Acquires Califta
We have written about Intrigo, who got their roots making APO work. Moving beyond their early days, Intrigo now has built software solutions that may sit on top of SAP (and other ERPs), but also can be stand-alone. This is a commercialization move that put them in a commercial off-the-shelf segment of the solutions market.
Hence it was intriguing to see Intrigo’s next move, the acquisition of Califta, a B2B commerce solution. Also a Bay Area company (that is San Francisco bay), Califta got their early-stage funding from some e-procurement pioneers.4 Said Padman Ramankutty, CEO of Intrigo Systems, “It is a natural fit for Intrigo to continue our expansion of cloud offerings, through the buyout of Califta, to better serve clients in the supply chain execution marketplace.”
Padman also told us that one of the great strengths of Califta was its ability to provide a rich B2B portal to portal communications so buyers and sellers can bypass EDI VANs. Califta can do the translations between different methods of purchase orders—852s or other documents—and rationalize the data that needs to be shared between buyers and sellers.
Califta also helps Intrigo’s expansion into other ERP territory due to a strong integration with Oracle.
IBS, the warehouse management and enterprise solution, was acquired by Marlin Equity. Marlin had a history in supply chain with such holdings as: Predictix; Emptoris, now owned by IBM; and MCA/Servigistics/Click, now owned by PTC.
In the field service logistics area which is becoming a hot little market these days, Microsoft acquired FieldOne for $39M. Since the advent of mobile technology—tablets and smart phones—a new wave of field service applications has arrived that are especially useful for SMBs who are service network partners of larger equipments companies. Many of these small service and repair firms have a strong need to efficiently manage their service routes but don’t necessarily need long-term and multi-echelon inventory optimization. So this is a good fit for both companies. We expect to see more deals in the field service area in the next year or two.