Nothing but Net: Top 10 IBSPs

In mid-1999, Summit Strategies began tracking a new category of "nothing-but-Net" service providers, or Internet business service providers (IBSPs). In contrast to "traditional" ASPs that use the Web to deliver packaged applications in a hosting model, IBSPs have constructed their applications for Internet-hosted delivery from the ground up.

Skipping the intermediate ASP phase entirely, IBSPs have developed 100 percent native Web-services solutions, ready for rapid self-service deployment, designed for fluid upgrades and developed to take advantage of volume economies.

So where are IBSPs today, 18 months later? Certainly, as with ASPs, IBSPs have had their share of failures, with fatalities such as Freeworks, HotBiz and RedGorilla. But others have stayed the course - and are setting the bar in this emerging industry.

Who are these IBSP pacesetters? We've selected 10 IBSPs that we believe are well-positioned to carry the nothing-but-Net Web-services torch forward in the horizontal business-services arena. We based our selections on several criteria, including their ability to do the following:

• Attract and retain active customers;
• Develop critical, strategic partnerships;
• Provide innovative solutions and services;
• Create effective go-to-market channels;
• Attract ongoing investments; and
• Earn praise from their peers in the industry.

Company Service Highlights Captura Web-based automated payment-processing services for expense reporting. More than 650,000 subscribers; Captura Expense Wireless service live with Ericsson, and tested with Sprint, Verizon, BT Cellnet and Vodafone diCarta B2B contract-management solution that enables companies to negotiate, track and manage revenue and expenditures; and renew business agreements online. More than 60 corporate customers; Technologic Partners' "Investors' Choice" award; Upside Hot 100 Award, 2000 ELetter Internet-based printing and mailing service. 2001 MVP Award, Best Marketing Service; Ziff Davis Smart Business; one of Home Office Computing's Best Web Sites for independent professionals and home-business owners; "Investors' Choice" at Technologic Partners' Internet Outlook Conference; partnership with RE/MAX to reach 48,000 RE/MAX agents directly Employease Human resources, employee benefits and payroll information-management and communication. More than 1,000 corporate customers; increased average new customer size by 350 percent; increased value of average contract by 700 percent; named to Red Herring 100 in 1998, 1999 and 2000; UPSIDE Hot 100 Award, 2000 iemagine Rent & Ready! Instant Webware provides online auctions, purchasing, surveying, warranty, storefront, recruitment, support, service, quoting, lead management and other services. ASP-in-a-Box Communications ASP Magazine's Product of the Year Award; supports 15 languages; finalist in Lotus Beacon Awards; jointly marketed with AT&T and IBM McAffee.com Web-based utilities to protect, secure, update and maintain PCs. More than 1 million subscribers; 2000 revenues of $46.9 million, up 91 percent from 1999 NetLedger Web-based accounting integrated with online commerce, expense reporting, credit card processing and bill payment services. 3,000 paying companies, 10,000 paying users; PC Magazine Editors' Choice Award; PC World Best Bet; Ziff Davis Smart Business MVP 2001 Award PlaceWare Web conferencing service. More than 1,500 corporate customers; Frost & Sullivan 2000 Market Engineering Entrepreneurial Award; Forbes Best of the Web B2B; Selling Power Top 150 Sales Website salesforce.com Customer-relationship management, including integrated customer-support management, marketing reporting and analysis, sales-force automation, and lead management. 25,000 companies use salesforce.com; partners with Sprint PCS to provide its services as part of the Sprint PCS Wireless Web for Business UpShot End-to-end sales management. Wireless device and synchronization support; Willy-2000 Award for the Best Web-Based Subscription CRM Solution; Microsoft Industry Solution Award for CRM, Mobile Solution These IBSPs are skating to where the software industry is going. As pioneers in developing and delivering on the promise of a truly Web-optimized, software-as-services model, these IBSPs — and the IBSP group as a whole — are well worth watching. If you've been tracking this fledgling market too, let us know your thoughts on our selections — you can e-mail me directly at — and whether there are any missing from our list that you think should be on it, or any we included that you don't think should have made it.

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