Instead, Wilson is relying upon the efficiencies of aggregation. “If you come to us as a merchant, we’re not only going to stake you with this really solid Website, we’re also going to make relationships with the partners that we know you’re going to need to do business with,” he explains. “Then we use the size and value of our merchant base to get discounts on products and services like ISPs, equipment leases, office supplies, travel, and Web promotion services, and take a small cut of those transactions ourselves.”
Also plans to leverage its customer base in a similar manner, taking sponsorships from companies such as Office Depot, AT&T, and MyPoints.com, all of which want to market their products and services to the small businesses that Bigstep.com aggregates. Ultimately, however, Bigstep.com sees value-added services as the greatest potential source of revenue. “We expect that the majority of our customers won’t ever pay us anything,” says Beebe. “But a number of them will become fairly successful online, and as they grow, they’ll look for more tools to market to their customers-very high-end services that even large businesses don’t have access to, like getting into loyalty programs like MyPoints or Netcentives. Until now, these things haven’t been accessible to the little guy at all, so we expect that some customers will be happy to pay us for them.”
Mohanbir Sawhney, a professor at Northwestern University’s Kellogg Graduate School of Management, is less bullish about this particular incarnation of the model, however. “If I just need some kind of presence online, it’s not a bad idea,” he says of the free-commerce sites. “But what kind of people are they going to attract? If I have some kind of business that I think is going to do very, very well online, I would be very leery of a shrink-wrapped solution. It’s going to constrain me. I won’t have control over it. But if I’m a little guy who has no idea if my business is ever going to be worth anything, I’ll sign up in a minute. So you have an adverse selection process. The conservative and the clueless sign up.” And the conservative and the clueless, Sawhney suggests, aren’t likely to purchase many premium services.