Last month, business-to-business online marketplace BizBuyer.com announced a $1 million (US$) seed round of financing from investors including eBay (Nasdaq: EBAY) CEO Meg Whitman. Today, the buyer-drive marketplace — founded in September of 1998 and based in Santa, Monica, California — was greatly bolstered with the announcement of a $5 million commitment from @Ventures, the venture-capital arm of leading Internet incubator CMGI (Nasdaq: CMGI).
BizBuyer.com, which focuses on small businesses, will launch more than 20 categories over the next three months, including Internet, telecommunication, insurance, financial services, legal, consulting, accounting, sales and marketing, human resources, office products and service.
Currently, the Web site is in beta testing with 1,000 Internet service providers bidding on requests from buyers across the country. BizBuyer.com’s service is free to buyers, while sellers are charged for submitting bids.
In 1998, 22 million small businesses purchased $800 billion in products and services, and BizBuyer.com is aiming to tap into this fast-growing market by simplifying the buying process.
“By 2003, thousands of small businesses will be purchasing mission-critical products and services online, resulting in a $1.3 billion boom in business-to-business e-commerce,” said Peter Mills, managing partner of @Ventures.
How It Works
Buyers who visit the BizBuyer.com site can review buying guides to help clearly define their purchasing needs. For example, the Internet connectivity buying guide features a glossary of key terms, information about the different kinds of connectivity, e-mail and Web site hosting and more. The guide also offers comparison tables to simplify the decision-making process, as well as information about negotiating rates with vendors.
After reviewing the appropriate information, buyers can submit requests for proposals from vendors. BizBuyer.com’s technology will then match the needs of buyers with vendors qualified to meet the needs. The vendors can then submit online bids directly to buyers.
BizBuyer.com will help buyers comparison shop by allowing them to review all the bids in a comparison table and then select the most ideal bid. Buyer names and contact information are only given to vendors at the buyers’ request.
“By focusing on small businesses, we are developing an in-depth understanding of their needs and purchasing processes,” said Bernard Louvat, founder, pesident and CEO of BizBuyer.com. “Our ability to source multiple vendors at once — and furnish the buyer with the most competitive bid within a few hours — dramatically simplifies the way small businesses purchase goods and services.”