B2B exchange making move to B2G
- By Dan Caterinicchia, Dan Caterinicchia
- Nov 27, 2000
Onvia.com Inc., a business-to-business exchange for small companies, will
soon target the state and local government market with the help of DemandStar.com
Inc., a business-to-government e-commerce provider that unites local government
purchasers with suppliers.
Onvia announced last week that it plans to acquire DemandStar.
DemandStar already does business with more than 200 government agencies
in 26 states. The company's clients include: San Antonio; San Jose, Calif.;
Las Vegas; Norfolk, Va.; and Hamilton County, Ohio. Onvia helps small businesses
by aggregating demand and providing a place where the firms can buy and
sell products and services.
"Why we acquired DemandStar is because of its leadership position in the
state and local space...and we want to catapult them into that space a lot
more quickly," said Gretchen Sorensen, vice president of corporate affairs
at Seattle-based Onvia. "They have about 100 employees and a sales staff
of 30, and we plan to take advantage of that."
DemandStar — which will become a wholly owned subsidiary of Onvia, pending
government approval — hopes to get stronger from the deal, said Sam Chesser,
a spokesman for Plantation, Fla.-based DemandStar.
"We have been successful with government agencies across the country, and
Onvia has essentially explained to us that they want us to continue doing
that," Chesser said. "Our mission is to continue doing that and there is
no foreseeable change in business for DemandStar."
The acquisition of DemandStar, which should be finalized by March 1, 2001,
based on the approval of the company's shareholders, is the second such
move in the B2G space for Onvia in the last six months. In July, Onvia acquired
Globe-1, another B2G exchange that manages government buyers in more than
25 markets, including some in the federal space, Sorensen said.
Onvia plans on keeping Globe-1 focused on the federal markets as well
as state and local opportunities, while DemandStar will continue to expand
its customer base with cities and counties, she said.