Why do enterprises make it so hard for employees to buy stuff? Levelpath looks for a simpler way

Figuring out how to buy something as an employee of a large organization can be a bewildering and time-consuming exercise — as Stan Garber and Alex Yakubovich realized after they joined Workday in early 2020. The enterprise software giant had just acquired Scout RFP, the supplier sourcing venture they'd co-founded, the pandemic was in full force, and they needed to get hold of some resources and giveaways for a virtual event. Sure, there's a highly effective procurement team in place, all the policies are set down in documents published on the company intranet, there's a procurement app to automate the core processes, and a catalog of approved suppliers for routine purchases. But there's no easy way for a first-timer to figure out what they need to do. That was the germ of their new venture, Levelpath, which announced a $30 million funding raise last month, bringing its total funding to $44.5 million. Garber says their goal is to streamline that initial process:

If you make the process much stronger on the front end UX — the process around guiding users, giving information to users — that will make it much better than the downstream [applications], which sometimes are a little bit confusing, and pretty narrow.

Employees need help before they start filling out a purchase requisition — often they need to know how to get to that point, and they want a better option than emailing procurement and then finding out a few days later that what they needed to do is fill out a form in another app. Garber believes a more conversational UI that provides step-by-step help is the way to go. This is the thinking behind the company's first product, a mobile-only app called Pathfinder. He explains:

Pathfinder's goal is to create a path for where these channels are you need to go, to get information to buy. It's an interactive way to do it and it doesn't always lead to procurement.

A single starting point for buying

So, for example, when someone sets out to buy something, the app will start by asking questions that help it establish which policies apply, depending on factors such as their job role, intended spend and location. For someone wanting to file an expense as an employee in a global organization where each region uses a different travel & expense solution, the first question is what country they're in. Based on the responses, the app then summarizes the policy they need to be aware of and shows them where to take the next step. He goes on:

It brings your policies, your procedures, your intranet page, to life. You have one starting point where anybody says I want to buy something, and we'll layer on top of all of it — whether you're using ServiceNow, JIRA, Workday, Coupa, etc, for the downstream applications, we'll layer that on top. So we can actually guide users to where they need to go to those tools, where they need to go to a policy, or they need to go to a catalog, or they need to go on an internal thing ...

It's then bringing that process and creating a path, a visible path as well, to the user, to the stakeholder, of 'Hey, I want to do this $50,000 purchase, or I'm working on a half a million dollar initiative,' actually creating a path. Here's the process for buying software in our company. Here's the process for buying marketing services, contingent labour, you name it. And then here's the approval flows that need to happen.

On top of that is the ability to multithread processes through the accompanying workflow engine, which brings together the approvals, the relevant data sets, and the collaboration. Pathfinder aims to put all of this together into a user-friendly mobile app that provides a single gateway into any type of purchasing and co-ordinates the various moving parts behind the scenes.

In speaking to prospective customers and early adopters, Garber has discovered that even procurement professionals themselves don't know the process for some types of purchase. He comments:

I've had so many procurement folks, when I'm talking through these demos, and just talking to them, they're like, 'Oh, yeah, I was trying to buy software, like an Adobe licence, or I needed this, and I didn't know how to do it in the company.' If you didn't know how to do, how do you think everybody else feels in the organization? You have the most access out of anybody to able to figure that out!

As part of the implementation process, the first challenge is mapping out all of these various steps, which often turns up some steps that aren't well defined or don't work well. Ironing out those issues is part of the process, as Garber explains:

With the design customers today, we're actually sitting down with them, 'Here's a whiteboard. How do we create the simplest flow for your users to find what they need to do?' There's a bit of homework that goes with the change. But the impact in what we're trying to get to is a delightful experience, to start it off. Where a user can be like, 'Oh, okay, now I know that that was simple to actually answer a question that I would have to spend like 10 minutes buried somewhere to find ... and send me to that page' ...

We just need to map it first, which sometimes is not the fun part. But once you have it, it gets way better.

Towards a single view of suppliers

Barely a year old, Levelpath already has 15 design customers, including the likes of Ace Hardware, SiriusXM, Qualtrics and Innovacare Health. It's been a rapid journey since the two co-founders moved on from Workday in March of last year.

At the outset, the initial plan was to take some downtime and mull over the opportunity the pair had identified. But in an extraordinary coincidence, on the very first day of arriving in Hawaii to start a joint family celebration trip, the pair had a chance meeting with Workday co-founder Dave Duffield, who happened to be vacationing in the same spot. His encouragement crystallized the decision to get the new venture off the ground. Garber recalls that Duffield, who subsequently became an angel investor in the venture, told them:

Come on, guys. You're not going to be sitting around and doing nothing. Get to it!

The next stage in Levelpath's journey is to bring together all of an organization's information about its suppliers, in the same way that today any employee can pull up Salesforce and look up all a company's customers, or go into Workday and see the employee directory. Whereas revenue and employees are closely monitored in today's enterprise applications, there's no equivalent where any employee can view all of an organization's suppliers in a digestible form. Garber says:

In today's world, you can take out your phone, type in an employee and see everything about them. Same thing with Salesforce. But there's nothing today where I can type in and be like, 'Oh, let me look up what's my relationship with [any supplier], in one place, [and say] 'Let's look at the contract data. Let's look at performance information, pull in some basic transaction data, any FP&A related data' — just one place where you can soak up some of that information to have.

It doesn't mean all of it has to be developed in Levelpath, but to be the corpus, to be the ledger of that information, that doesn't exist today ... Supplier is one of the most decentralised sets of information in an organization. Everybody's got an instance of Supplier X in whatever tool that they're using, and there's nothing that's bringing it together.

Building in AI

AI is also at the heart of the Levelpath proposition. One early use case for generative AI is to collect information on suppliers. With fairly basic prompt engineering, the team has been able to build an automated process that not only assembles a supplier description and a list of its main product offerings, but also lists the top competitors for each of those offerings. This enables smart search, so that when an employee searches for a vendor or product that's not on the approved list, the system can propose an alternative that is. Garber says this feature has already been well received by customers:

Adding a new supplier today is so complex in any organization, between the five steps it needs, especially software. If you can streamline it and stick with an existing supplier, there's some gold there.

That's a very simple use case that we're doing day one with AI, that's very light. There's no IP, you're not actually putting data back into a model. You're just literally taking what's already in the market, and just putting it up.

Future use cases for AI include a co-pilot that takes the user through a renewal process, or simply just enabling a more conversational UX when asking for information, such as 'Can I see all the contracts based in New York with these clauses?' As well as being mobile-first, the company has also integrated into Slack and Teams for conversational interactions. Garber says the mission is to bring a consumer-grade user experience to the everyday procurement process. He elaborates:

The mission is delightful procurement ... Everything we do is, how do you take the consumer UX and apply it to an enterprise grade tool? Because that's what people expect today, when they walk into the four walls of their office ... Consumer tech is designed for millions, if not billions, of users. The UX that supports enterprise software is more complex, I get it. But it's designed sometimes too process-centric and giving flexibility in the UX around all that is really important ...

Fast forward, when you're travelling and you're on work, a procurement leader can pretty much, every project, every savings initiative, they can literally open up their their app and see anything they need to, just like your sales leader can do it today ... It's using tech that's already out there and just bringing in procurement [which has] always been one of those groups that gets tech a little bit later than sales.

My take

A new wave of technology is creating an opportunity for apps that fill in white spaces around existing processes throughout the enterprise, and the buying process is no exception. I remember speaking to procurement vendors in the early days of the business Internet and it was all about, 'Why is it so easy for me to buy things on Amazon, why can't it be as easy as that to buy things internally?' That generation of vendors have automated that process, but now a new generation of business users are asking, 'Why can't I just ask for something and it guides me through the buying process, just like ordering on Uber Eats?' That's why there's an opportunity today for a new wave of procurement apps, because what the technology is capable of doing now is such a leap forward from twenty years ago — with AI pushing the envelope even further.

This explains the emergence of Levelpath and similar players such as Zip, or Pivot in Europe. Garber and Yakubovich already have two successful ventures behind them — they created a restaurant food ordering app straight out of college before going on to found Scout RFP — which bodes well for a third success. Garber says they're putting a lot of effort into getting the underlying supplier model right so that they can achieve that bigger vision of being the go-to source of truth on suppliers. It's a bold vision, but if it succeeds it promises to open up new ways to analyze buying patterns and improve spend that are hard to achieve with current approaches. One to watch.