Basware announced today that it has acquired Redmap. This Australian company adds interesting new potential target audiences for Basware. Combined with recent new developments such as InvoiceAI, this should put Basware even more firmly on the map in the world of Accounts Payable (AP) and invoicing.
More than four years ago, we took a deep dive into AP and related developments at Basware. AP may not be something most organizations want to spend a lot of time thinking about, but it is extremely important. After all, it is important to handle invoices correctly. Otherwise, the finance department will end up in chaos.
Agentic AI addition to offering
The 2021 article already talked a lot about automation and the use of ML and AI. At that time, Basware had only just begun to automate Invoice Lifecycle Management, as Basware calls the end-to-end management and processing of invoices.
Several years have passed since then, and things now seem to be moving at a good pace. Basware recently introduced InvoiceAI. This is an agentic addition to the AI that the company already uses to process invoices. A concrete example of the usefulness of InvoiceAI is that it not only identifies invoices without a PO number, but also interprets them (i.e., understands what they are for) and makes suggestions for the correct number based on previous invoices from the same party. Finally, the agent forwards the invoice to the right person.
At first glance, the above situation may not sound particularly interesting. Until you read a few figures and let them sink in. According to Basware, which bases its figures on the processing of 272 million invoices in the past year, organizations receive 40 percent of all invoices without a PO number. It is estimated that this amounts to a total of $549 billion in expenses for organizations that they have little to no insight into. These invoices can be seen as a blind spot for finance departments and, ultimately, the CFO.
Please note that InvoiceAI will not immediately and magically make that 40 percent disappear. At least for now, its main purpose is to remove the blind spot and then make good and clear recommendations for handling invoices without a PO number correctly.
InvoiceAI consists of five components
Incidentally, InvoiceAI is not a single tool. It consists of five components. SmartCoding automatically fills in invoices with the correct codes. SmartWorkflow was developed to forward invoices to the right people for approval. SmartPDF, something we already wrote about in 2021, has also been incorporated into InvoiceAI. In short, it is a much smarter version of OCR and converts paper invoices or PDFs into electronic files that can be immediately incorporated into the AP workflow.
The last two components of InvoiceAI are the AP Business Agent and the AP Data Agent. The first helps staff process invoices in real time. The second makes it possible to extract simple answers from the AP data.
Redmap acquisition broadens market for Basware
The real news today is not InvoiceAI, but the acquisition of Redmap. This may not be of immediate interest to all the regions of the world. After all, Redmap is an Australian provider of AP automation software. In our opinion, the real news of this acquisition is not so much the improved position it gives Basware in that market. It is much more about what the addition of Redmap’s AI and automation adds to Basware’s portfolio and platform in general.
With Redmap, Basware adds more opportunities for the mid-market segment. That is where Redmap’s main focus lies. Different segments of the market require different approaches. Just think of the different ERP systems used in the mid-market compared to higher segments. ERP and AP are closely intertwined, because invoices often come directly from an ERP system to an organization’s AP department.
Of course, for Basware, the main immediate focus is on what this acquisition means in Australia and the wider APAC region. It sees great growth potential there. But the potential impact of this acquisition in the rest of the world should certainly not be underestimated either. Conversely, Redmap’s customers will naturally also immediately gain a whole range of useful functionality. Ultimately, this acquisition should bring seamless and highly automated (perhaps even autonomous) Invoice Lifecycle Management a step closer for more organizations.