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Hubspan is in Suppliers’ Corner

Written By: Steve McVey
Published On: October 31 2000

Hubspan is in Suppliers' Corner
S. McVey - October 31, 2000

Event Summary

Hubspan Inc. offers a hosted solution for mid market suppliers who want to participate in marketplace initiatives that are operated by or for their buyers. Hubspan CEO Rick Luebbe believes that the vast majority of today's marketplace solutions neglect the specific needs of suppliers. Suppliers are usually "enlisted" by large companies to join a new exchange or trading hub but are offered no assistance in connecting to it beyond the specification for an interface they must scramble to build. Many suppliers consider participating in B2B marketplaces as a requirement for survival in an extremely competitive environment, but find that joining even one marketplace, let alone many, to be a difficult and expensive process.

Based in Seattle, Washington, Hubspan thinks it has found the answer to suppliers' problems. Its marketplace connectivity software offers access to any e-procurement system via real-time interfaces that support the gamut of protocols including cXML, EDI, and RosettaNet. Hubspan provides a secure, scalable and reliable service through its ASP partner Exodus. Suppliers also benefit from a platform that allows them to deliver product catalogs, price and availability, invoices, and advanced shipping notification to buyers on an exchange. The hosting model should be especially attractive to mid market suppliers as it allows them to participate in exchanges without costly and time-consuming hardware and software installations.

Market Impact

Vendors of platforms that enable B2B marketplaces seem to proliferate as rapidly as the marketplaces themselves. It is unclear how many vendors will survive the shrinking B2B market intact and avoid either bankruptcy or consolidation. Hubspan may well be one of those that survive the shakeout. Although it is keeping a low profile prior to an official launch in January, it has secured early stage funding from high profile backers Andersen Consulting Ventures and Seapoint Ventures. In addition to providing financial support, Andersen can be a lucrative indirect channel for Hubspan, which can supply next generation marketplace connectivity for Andersen's B2B engagements.

Apart from the implied vote of confidence and potential revenues represented by its backers, Hubspan also boasts a sound value proposition for an underserved market - those mid market companies that face extinction unless they can quickly transform their business processes and technical infrastructure to connect to B2B marketplaces. Hubspan supplies the infrastructure for partners like Andersen Consulting and other smaller systems integration firms that can perform the business process reengineering for mid market clients.

The combination of Hubspan's technology and Andersen's consulting power has huge potential, but much work remains. The company is concluding the beta phase of its solutions and plans to make them generally available by the end of January 2001. The novelty of the solution and company, not to mention the security issues surrounding the ASP delivery model, may initially give suppliers pause. With a hand from Andersen and its hassle-free subscription model, Hubspan should get beyond this barrier and start growing significantly by the end of 2Q01. Hubspan plans to use direct sales for signing initial customers and then rely more heavily on indirect channels like Andersen and future alliances with third party software vendors.

User Recommendations

Mid market suppliers in any industry segment would need to look hard to find another company with a stronger value proposition than Hubspan. Hubspan plans to cast a wide net in its initial marketing push and will go after those vertical markets that respond with the most enthusiasm. Consumer goods, electronics and retail industries are promising candidates, and suppliers who have been asked to participate in buyer marketplaces should place Hubspan at the top of their list of candidates in selections.

 
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