Ketera Technologies: Slow Starter?

By Baselinemag  |  Posted 2006-01-14 Print this article Print

Ketera Technologies customers like its easy-to-use applications and hosted model, but some say its services took longer than promised to set up.

Ketera Technologies has won customers with a relatively low-cost hosted software model and an emphasis on easy-to-use, Web-based applications. But some say the company has delivered subpar service: At least two customers complain that Ketera took twice as long as promised to complete its setup.

Khalid Baig, senior manager of strategy and planning in Toshiba's purchasing office, uses Ketera's Spend Analysis software to get a handle on spending across 15,000 suppliers used by the company's nine U.S. divisions. However, when Ketera loaded six months of Toshiba's spending data into its system, the process took six weeks, whereas Baig says Ketera's sales team told him it would take two or three. Ketera also has been slow to respond to requests for technical support, according to Baig. "They don't always get back to us in a timely way," he says.

Meanwhile, Ketera's initial setup for Newmont Mining, a gold producer based in Denver, also took twice as long as the company expected. Cayce Rivers, Newmont's manager of supply-chain management enablement, says it took Ketera four months to sort through 1 million purchase transactions totaling $3 billion, instead of the two months he expected.

"They didn't understand the complexity of our data," Rivers says. He adds, though, that Ketera's Spend Analysis tool provides a "robust and easy-to-use interface" that has allowed Newmont employees to run spending-analysis reports themselves instead of funneling requests to the information-technology department.

In response to customer concerns, Ketera CEO Steve Savignano says that with respect to its Spend Analysis service, "the first time you look at an industry, like mining, you have to spend time" adjusting the application manually to categorize data. But once that has been done, he says, subsequent runs are much quicker.

And to be sure, other customers say Ketera works hard to please and delivers fully on its promises. "It's a small company, but a growing company—one that's attentive and responsive to feedback," says Kulvir Gill, manager of supply-chain enablement for Barrick Gold, a Toronto-based gold mining company.

Gill says Ketera's pricing for its Spend Analysis service over three years worked out to be 50% less than proposals from vendors selling similar software: "At the end of the day, Ketera was the best value."

Spend Management and Analysis

Ketera Technologies
3965 Freedom Circle
Santa Clara, CA 95054
(408) 572-9500

Ticker: Privately Held
Employees: 120

Steve Savignano
Chairman & CEO
Before he joined Ketera in 2002, he was responsible for e-commerce applications at iPlanet, a portal software joint venture between America Online and Sun Microsystems.

Percival Tieng
Previously worked at iPlanet, Netscape and Oracle.

Ketera Spend Analysis service lets companies consolidate and analyze spending data. Ketera Sourcing services automate interactions with suppliers, such as auctions, and gives a centralized view of buying activities. Ketera Procurement services let employees buy products and services at negotiated prices from contracted suppliers. Ketera Contract Management provides a repository for contracts and manages approval workflow.
Reference Checks

Rob Brindle
Dir., Procurement Operations
Project: Home services company based in Downers Grove, Ill., has used Ketera Procurement to let 600 employees in its TruGreen ChemLawn unit buy $70 million worth of fertilizer and other materials.

Mitch Plaat
Dir., Contract Services
(503) 450-6342
Project: Trucking and logistics company uses Ketera Procurement for 1,500 employees who buy products and services from 20 suppliers; it spends $24 million per year through the system.

Jim Cebula
Dir., Global Purchasing and Travel
Project: Maker of metal-cutting and construction equipment ensures employees buy from 16 contracted suppliers with Ketera Procurement.

Barrick Gold
Kulvir Gill
Mgr., Supply Chain Enablement
Project: Gold mining company based in Toronto uses Ketera Spend Analysis to analyze $4 billion in spending with 20,000 suppliers over 1 1/2 years, sorted into 1,200 categories.

Newmont Mining
Cayce Rivers
Mgr., Supply Chain Management Enablement
Project: Gold producer based in Denver started using Ketera Spend Analysis in January 2005 to get a consolidated view of $3 billion in spending with 11,000 suppliers over 2 1/2 years across eight business units.

Executives listed here are all users of Ketera's services. Their willingness to talk has been confirmed by Baseline.

Revenue, 2004: Less than $10M (Baseline est.)
Revenue growth claimed: 100% from 2004 to '05
Total funding to date: $30M
Major investors: American Express, Foundation Capital, Integral Capital Partners, Kleiner Perkins Caufield & Byers
No. of customers reported: 70
No. of users reported: More than 80,000

Santa Clara, Calif. (headquarters); Bangalore, India

Financial Services: Capital One Financial, GMAC Commercial Mortgage
Food Service: HMSHost
Transportation: CNF, Delta Air Lines, UAL
Manufacturing: BASF, Cabot Microelectronics, Maytag, Toshiba
Media: Acxiom, The Washington Post Co.
Retail: Gap

American Express, IBM, Salesforce.com


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