Aptos Engage: Transformation Around the New Normal

Last month I had the opportunity to attend Aptos Engage. Like most of the retail technology user conferences this year, the event was held virtually, with the hope that next year the event would be in person. I happen to have a long history with Aptos. When I first entered retail as an analyst almost 17 years ago, Aptos was then NSB Group, and it was a leader in the POS space. And while the Aptos of today is very different from the NSB Group of that time, so many of those core competencies remain, not the least of which is expertise in the POS and mPOS space.

Beyond the fact that it was conducted virtually, the event had a very different focus from previous manifestations of Engage. This year the focus was on the customer, so much so in fact the attendee list of industry followers, press and even partners was much more limited. For those who haven’t closely followed Aptos, there have been quite a few changes in the past year, so this event was a great opportunity to highlight those, turn the page in a few areas, and reveal the strategy that will help Aptos achieve the ambitious trajectory that I’ve witnessed over the past decade plus.

If you ascribe to the philosophy of go big or go home, you recognize that Aptos has gone big in the past 15+ months. Key changes include a new CEO in Pete Sinisgalli, changes in over half the core leadership team, new owners in Goldman Sachs who acquired Aptos from longtime owners Apax Partners in March 2020, and two major acquisitions, LS Retail and Revionics. Along with many new faces on the leadership team, there has been a significant change in organizational structure to better position Aptos to meet future growth objectives and better serve the customer.

During the opening keynote, Pete Sinisgalli introduced himself. Talking about his background and his history, which included serving as CEO of Manhattan Associates, Pete outlined his vision for the company. For me the key thing to note was that, not surprisingly, Pete has deep technology expertise in general, and with his long stint at Manhattan, he has deep domain expertise in retail technology. Pete has also worked closely with Goldman Sachs portfolio companies, so there is familiarity there as well. As a sidebar, I will add that Pete noted one of the personal reasons he took the job is that he has grandchildren in the Atlanta area, where Aptos has its global headquarters. While to many this may seem like a relatively esoteric point, given Aptos’ DNA as very community and family focused, I think it bodes well as a fit within the Aptos culture, which the previous CEO, Noel Goggin, worked so hard to establish as a key differentiator.

Steve Towe, who joined Aptos in 2016 and was appointed president in August last year, took the opportunity to talk about some of the company’s areas for ongoing improvement. Based on feedback from Net Promoter scoring, clients were generally pretty high on Aptos across the board, though Steve recognized the need to innovate and move faster in some product areas and to continuously refine processes for product delivery and implementation timelines, and how best to course correct when things are not going well.

To help address these areas, two key things were done. The first is that Pete and Steve went to Goldman and asked for significantly elevated funding to support the Aptos ONE platform and to accelerate roadmaps for other key solutions. Second, they now have regional general managers supporting each of the three regions of focus — the Americas, EMEA and APAC. The change in organizational structure was a key announcement for me. While Aptos’ interest in the Americas and EMEA is not new, Goldman has a particular interest in tapping into emerging markets in Asia, as well as strong ties and investments there, and given that Aptos currently has a small footprint in the region, APAC will be a key region of focus moving forward.

Within the larger context of positioning Aptos for the future, LS Retail and Revionics were acquired to strengthen its portfolio and better diversify its client base to service retailers across all tiers and sub-segments. Most reading this will be pretty familiar with LS Retail, but by way of quick summary, they play primarily in the SMB space but are very broad, with a position and solutions in general retail, convenience, hospitality, lodging and grocery. They offer a combination of on-premises and growing cloud-based solutions that are based on the Microsoft Dynamics platform, and they have a very strong presence in Europe, though with clients in every region of the world.

If there were a spectrum for vendors, Revionics would be quite the opposite of LS Retail. Revionics’ business model is in the price optimization space, with the vast majority of their clients in the Tier I and super-Tier I space with verticals of focus being grocery, convenience and fast-moving goods. They have deep expertise in analytics, optimization and artificial intelligence. There will be countless areas where the Revionics solution set and expertise will be used to augment the existing Aptos portfolio. Placing these two acquisitions in context, you can see additions in the ability to move up and down the value chain, but probably more importantly, to expand the vertical offerings in which Aptos now can be included. While we don’t expect Aptos to compete for Tier I grocery POS deals tomorrow, if I were a betting person, I’d say we’d be having a very different conversation five years from now.

While I’ve covered a lot of ground talking about the new, I also want to spend a few minutes highlighting updates on the core product, and for Aptos, the foundation moving forward is Aptos ONE. Aptos ONE was birthed five years ago as their next generation cloud-based platform, architected using microservices. The goal and vision of Aptos ONE is to be the leading Unified Commerce platform.

Those who follow retail technology know that cloud-based solutions are table stakes, and likely also know that solutions architected with microservices are becoming the choice for companies of all sizes. While the pandemic has been an accelerant in some areas, it has also shined a light on the importance of speed to innovation and flexibility, something that microservices absolutely enables. So it’s not all that difficult to understand, and likely wasn’t that difficult of a sell for Pete and Steve to convince the Goldman board of, the need to invest well beyond the previously planned funding commitments.

Given all that has been accomplished, it was clear as I sat in on several sessions that there is much more to be done. While a list of all those things would be well beyond the scope of this brief summary, I wanted to close this out with an overview of the things that I’ll be keen to track over the next couple of years:

• LS Retail is currently operating as a stand-alone business unit within Aptos. I will be curious to see what the future integration of Aptos and LS Retail will look like, if in fact any integration moves forward.
• The pandemic has driven a surge in demand for microservices-based Unified Commerce platforms, and the market is immensely competitive for these offerings. It will be interesting to see if Aptos can accelerate its development path for Aptos ONE and strike while the iron is hot.
• As Revionics becomes more tightly integrated within Aptos, what direction will the cross-pollination take between Aptos and Revionics solutions?
  • Specifically, how will AI from Revionics be incorporated into Aptos solutions, and at what pace, and where will the focus be?
  • Which of the Aptos core solutions will be expanded to service the grocery and convenience space?
• How can existing LS retail offerings, specifically for hospitality, grocery and convenience, help Aptos expand into verticals where Aptos has had minimal presence?
• How well will the Asian market accept Aptos offerings when they trend more toward in-region providers?

The progress reviewed was impressive, and it will be exciting to see what the next decade has in store.