SAP’s newest employee-led venture, Paid Pronto by SAP, is an application that automates accounts receivable processes. It has received seed investment and officially joined SAP.iO Venture Studio with the goal of building a new growth business to impact SAP’s business and customers.
SAP.iO Venture Studio cultivates an environment for in-house innovation by investing in small, entrepreneurial teams to build, launch, and scale products that address some of the biggest problems in enterprise. SAP employees are encouraged to tap into their entrepreneurial spirit to pitch product ideas to the program. After a competitive selection process, the founders can develop their product inside the company.
The idea for Paid Pronto came out of an understanding of how difficult and time-consuming the process of collecting money can be for businesses. In the U.S., Atradius reports that 47% of invoices are not paid on time, and approximately two of every three late invoices still are not paid after another 30 days. Typically, to get a customer to pay these invoices, teams have to manually follow up to understand why customers aren’t paying, help them work through issues like billing disputes and invoice updates, and update internal teams on progress.
At enterprise scale, this is a massive undertaking. Keeping up with all of these processes for thousands of invoices and customers can often prove to be challenging. Therefore, improving accounts receivable operations can provide significant benefits for working capital management.
Paid Pronto aims to drive cash into businesses faster by accelerating receivable processes through automation. It does this by automating standardized tasks, like customer correspondence, to support receivables teams in covering their large book of customers. Through the automated communication solution, customers receive personalized and easy-to-digest reminders beginning when an invoice is first released until payment is received. These communications help ensure customers have full transparency into what they owe and can flag issues or questions earlier in the process.
Paid Pronto aims to deliver value to enterprises in three ways. First, it increases the total cash collected by improving customer response rates and getting more customers to pay their invoices. Second, it decreases the days of outstanding sales by surfacing issues sooner. And third, it helps reduce the total number of open invoices, limiting the number of items a collector needs to follow-up on.