Emburse CEO Marne Martin discusses:
- The durability of expense management services
- Strategies in taking on the ‘Goliath’ Concur
- Potential acquisitions
Travel and expense software provider Emburse recently announced a new CEO: Marne Martin, a newcomer to the travel and expense industry but a veteran in technology and software, having spent more than 25 years in the industry including a stint as CEO of field management software provider ServicePower.
Speaking to BTN executive editor Michael B. Baker just about a week into her new role, Martin said there’s an opportunity for Emburse to fill a “gap” leading to what will be the future of expense management, as she sees some of the company’s largest competitors as either slow to innovate or bogged down by other internal issues. “We hear a lot from our customers and our prospects, but I still feel like there are many influences and needs that aren’t being articulated yet, so I want to get in front of that and build Emburse as a company that’s not only listening in this space but advocating and driving what people need in this space,” Martin said.
In terms of building customers, those opportunities will include going after not only the customer base of market leader Concur—who Martin called “the Goliath that has gotten stuck”—but also “a huge market that’s never been on Concur and maybe has never been on any best-of-breed solution,” she said.
An edited transcript of the rest of BTN’s interview with Martin follows.
BTN: What drew you to accept the CEO role at Emburse?
Marne Martin: For me, I look at categories of software that I have personal experience with but I’m also passionate about. I’ve used Concur and Expensify, and I’ve traveled a lot. I definitely relate to that. But I’m also looking at sectors that aren’t going away. Even if you apply more AI, there still are going to be expenses to manage and oversee. People will still be traveling. I try to pick categories of software that are super durable to the customer need. Then, I try to pick companies that are already proven that they are good companies and have good products and people, but it’s the next level of growth and next scale or inflection point that they’re ready for.
I was really fortunate with the trust that [Emburse owner K1 Investment Management] and the board and [former Emburse CEO Eric Friedrichsen], transitioning to me. Emburse is really at an inflection point. Of all the various companies I looked at in different categories, it’s an area of software I not only know something about, but it’s also at an inflection point that is interesting. The marketplace is both ripe for disruption with competing solutions, plus there’s a lot of [total addressable market] or greenfield to go after.
There are not many female CEOs who have been CEO more than once. A lot of the private equity sponsors have started looking for more female operating partners, so I do admire K1. Now, both of their largest companies will be run by female CEOs, so that personally makes me happy, but this is a category that is very interesting for a lot of different private equities. It’s K1 that put their money in the space in building a platform for growth.
BTN: We often hear promises of “the end of the expense report.” What sort of role does Emburse have in that landscape?
Martin: People will pay for that. It will be interesting over time what we focus on with our product roadmaps, how we maybe charge for the software and how you think about it might evolve, but it will never change that you need to have a link into expenses, and that will be a critical part for compliance and accounting but also a tool for growth. No business can grow their business if they have uncontrolled and unmanaged expenses. What we do is super important at the heart of how they run their businesses. The easier we can make it for them to not only stay within budget but think about being a driver of their profitable growth and how well we can help them do what they need to do and help their CFOs, that’s a big responsibly and opportunity for Emburse.
BTN: Emburse has reported fairly rapid revenue growth over the past few years. What’s your strategy to sustain that?
Martin: Eric and the team have done a great job. So many software companies don’t even get to the size of Emburse. They’ve already done something that hard and unusual. They’ve created a software unicorn.
One of the experiences I’ve had throughout my career is how you get things to grow faster organically, and that’s something I’ve done over and over. To simplify it, I think about what’s already working, but how do we just do more of it? If we have a good value prop that we’re executing on, how do we keep driving pipeline? There are some things at Emburse we can do even better.
We have taken a surprising number of Concur customers to Emburse for the size of Emburse, but there are a gazillion Concur customers we’ve never even talked to. We’re going to continue scaling what the company does well, and some other areas where I think we can have greater confidence, success and execution; we’ll push on that. I have a lot of experience. I didn’t come from Concur as an example, but the number of multinational and enterprises I’ve worked with in the past are mostly on Concur, so even though I might not have sold them the Concur replacement, I’ve been working with them and know them, and that’s where we’ll continue building. We have a lot of references already. It’s not like we’re starting from scratch. People don’t even know we’re in 120 countries with our software.
I also try to find businesses that I can bring a more evangelist or brand advocacy to. That’s why I always care about joining companies I can be authentically passionate about, so we can really start positioning ourselves not only as the size of company that we are but as the size of company that we will be. That growth and that mojo is what encouraged SAP to buy Concur in the first place. I think they’ve been distracted by other things, and the people who built that mojo at Concur have moved on. There’s a huge opportunity for Emburse to go on its own journey. We’re well-positioned to do that, and a lot of that will come through organic growth execution, the maturation of sales and marketing.
BTN: You have a long history in software outside of the travel and expense sphere. Are there skills or strategies from those other areas that will be valuable in this industry?
Martin: For sure. Chrome River, for example, has quite a sophisticated workflow engine. I think it’s as good as what Concur has, maybe better, but at least comparable. I have a lot of experience in other sectors taking rules-based or workflow-based software and starting to layer in AI and machine learning. I’ve been talking to our team about that. Even how you think about facial recognition software or fraud detection software, how you detect anomalies and trends, how you build out AI and machine learning related to anomaly detections, recommendation and learning, it’s pretty much the same regardless of the software category, because it relates to the data and knowledge around that. How you apply it is what needs to be tailored to the use cases that apply to that category of software, and then how you’re able to monetize it.
Whether you are looking at infrastructure fault data or asset anomaly data or looking at it for consumer behavior or for expense management, you need to figure out what drives the most business value and improvement from what you already have—like a sophisticated workflow—then thinking about it. AI, to be commercialized, has to be better than a team of data scientists. To be valuable, it has to be better than people. In this day and age, it’s hard to get enough people to solve many of these problems, which is why we use AI and machine learning, and it’s enabled by the cloud and the huge compute powers. ChatGPT is super fun to play with and interact with, but I was laughing that probably the most commercial benefit from ChatGPT or anything like this in the near term is that the cloud hosting bills tripled, because AI consumes so much more of the cloud. As software vendors, we need to put AI to work in ways that will be valuable and customers will pay for it, but the cloud companies and also the people doing the AI chips and semiconductors, they’re the leading indicators of benefiting from these. We need to understand what our customers and prospects really want.
BTN: What goals have you set as CEO?
Martin: Some of them are financial goals. Other goals are win goals, brand recognition goals, operational efficiency goals and really thinking how do we build a great company. Emburse is already a great company at its stage. How do we build a great company that’s a $500 million company or even bigger? There are different things when you think about scaling and efficiency then you might think about when you’re focusing on acquiring 13 smaller best-of-breed entities.
Taking the company on this journey also will involve talent. Similar to how companies choose different CEOs for different chapters, there will be different people within the organization at all levels that are better suited to different chapters. Some, of course, will always be valuable, because they understand the space and what we do from a core perspective. Some of the people needs and people processes will evolve as we’re positioning ourselves to the next stage of growth. I really am blessed to come into such a good company that has the domain expertise that’s critical: good products, good people and really excellent customers.
BTN: Emburse has been pretty busy on the acquisition front in recent years. Are you planning more?
Martin: TripBam and Roadmap are great acquisitions, and their customer lists are phenomenal. We are going to see how we can cross-fertilize those customers—expense management more to travel, travel more to expense management—to really think about share of wallet across all the businesses that have needs for that. K1 has done a really good job buying up in the U.S. market. There might be some additional travel acquisitions we could make. There are some smaller expense management and other types of companies outside of the U.S. it might be interesting to look at. I always analyze: Can we get those customers and go into that market organically if we are better at organic sales, or do we still need to buy them? When I look at buying them, I really look at are we getting something that’s unique or different, or is it more like consolidation play?
We are reviewing our M&A now. K1 is very well funded. We have to find the right acquisitions that really drive value to us, an accretive acquisition, or something that is interesting. We’re thinking software first, but that doesn’t mean we aren’t also thinking about credit card partnerships, financial services and fintech. I’ve built those out as complementary to the software, and in certain cases they can drive greater retention figures and revenue. I do firmly believe that to have a durable software business you have to be growing and developing great software, even if you add other things into what the software does.
BTN: What sort of connections are you looking to make with Emburse customers?
Martin: As the company grows, there will come a time when I won’t connect with all the customer or prospects, but that’s something I’m passionate about. I sent out personal emails to our larger customers today. We’ll be doing some events and customer advisory boards. I’m very eager, whether it’s a LinkedIn or email, to get to know them. When you come in, no matter how good a company is, there will be users that are like, “XYZ didn’t work”. Some of the feedback might not be all an A-plus, but that’s also how I learn what thy need and how we need to improve. My formal title is CEO, but I should be called the chief problem solver. That’s my internal title.
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