Words for Thought

"We believe the small business market is one of the hidden gems worldwide today. The adoption of Web sites is very much active and will grow for the next few years."

Where did other ASPs go wrong? They made two fundamental miscalculations, Bulens told ASPnews. The first was underestimating what it takes to build a brand that small businesses will trust.

"It is clear that there are a fairly small number of large companies who have very long-standing relationships with small businesses, and they are the ones that small businesses will turn to, to secure and establish their Web presence," he said. Those companies — including banks, telecoms companies, computer manufacturers, established Web destinations and ISPs — are now the key customer base for Trellix, which has a strictly private label-only strategy.

Speak Out

How can ASPs best tap the small business market? Give us your feedback at the ASPnews Discussion Forum

Providing the Competency
Instead of trying to challenge these big brands in the small business market, Trellix works with them by providing the appropriate technology and services they lack. "Virtually none of those companies have as a core competency the creation of applications and services for small businesses," Bulens explained.

The same strategy of working with established brands is one that others in the ASP industry have pursued with far less success to date, including Rivio, Bizfinity and NetLedger (the latter now rebranded as Oracle Small Business Suite). But the slow progress such companies have made is due to their assumption that small businesses would want extensive e-business capabilities from an online provider, said Bulens.

"It was a myth that the Internet was all about "e"-enabling small businesses — to turn them into electronic enterprises. That is not going to happen for decades," he said. "The majority of the opportunity is around a Web presence. It's not about e-commerce. It's not about e-backoffice. Small businesses simply want a Web presence that they can create themselves, that consists of a domain name, perhaps email, and of course a Web site."

According to the most recent U.S. census, there are 16 million businesses in the sectors Trellix is targetting, and according to projections by IDC, the vast majority will have Web sites by 2003. With its emphasis on making it easy for business owners to build and maintain a professional-looking basic Web presence without having to hire costly consultants, Trellix aims to pick up a large chunk of that market. It believes much of the revenue will come out of the same limited budget that already pays for local newspaper ads and yellow pages listings, as the Web site becomes an integral part of small business self-promotion. "People expect you to have a telephone number, a fax number and a Web site," said Bulens.

Its customer base has expanded rapidly in the past year to include, among others, the About network, CNet Networks, and Inquent Technologies, a leading provider of outsourced hosting to telecoms companies. Just before Christmas, it added Tucows division Domain Direct and private-label hosting provider Interliant to the list (see Trellix Caps a Busy Week).

Continued on Page 2