Here's a reprint of a Forbes story on Concur and Commerce One dated 10/4/99. A great story on Concur that was largely ignored as they warned the following day.
I especially liked this part:
"In a few weeks, the company is likely to announce its Concur Network for buying and selling over the Internet, putting it squarely against giants of the game, Commerce One and Ariba."
October 4, 1999
Concur, Commerce One take center stage this week
By Om Malik
NEW YORK. 11:00 AM EDT-September was a good month for Mountain View, Calif.-based Ariba (nasdaq: ARBA), a leader in e-procurement business. Its stock gained more than $25 a share as investors bought the company's business-to-business e-commerce vision hook, line and sinker.
In this first full week of October, expect rivals Commerce One (nasdaq: CMRC) and Concur Technologies (nasdaq: CNQR) to stage a rally. The Walnut Creek, Calif.-based Commerce One is expected to announce a new partner for its wildly successful Global Trading Web network, most likely in the Asia Pacific region. Existing partners include British Telecom, Singapore Telecom and NTT of Japan.
A fourth franchisee will be announced on Tuesday, says Chuck Donchess, vice president of marketing and business development at Commerce One. "These franchises are key to the growth of our company as they get us started in new markets really fast and give us access to new customers," says Donchess.
Analysts note that getting more customers is vital for companies like Ariba and Commerce One. "The idea is to grow real big real fast," says Ian Morton, a business-to-business electronic commerce analyst with Hambrecht & Quist. Not to mention the real money that it brings into Commerce One's coffers. It is estimated that Commerce One is generating $1 million in sales just from its BT franchise.
Commerce One, like its rival Ariba, sells software and services that connect global buyers with suppliers of business goods and services over the Internet--a market pegged at more than $1.3 trillion in 2003 by Forrester Research of Cambridge, Mass.
The announcement of a new franchise and additional customers is likely to add a further pop to the stock in coming days. Not that Commerce One has been a slouch: It was up 110%, or about $52 a share, in September and is at present trading at about $97 a share.
However, Concur Technologies of Seattle could prove to be the sleeper hit-of-the-week. The company is expected to announce its hosted application service, EmployeeDesktop.com, which has been in beta.
So far Concur's sales have come from its main product--Employee Desktop, an intranet-based application that allows corporate executives to file and manage their expense reports, make travel plans, book airline tickets and even manage their personal finances and order supplies.
Employeedesktop.com is a web-version of that product and allows users--mostly medium and small businesses--to use the service over the Internet from a simple browser. In under a year expect the company to announce a customizable version of its EmployeeDesktop.com solution.
This could be preamble to Concur's bold new move into the e-procurement business. In a few weeks, the company is likely to announce its Concur Network for buying and selling over the Internet, putting it squarely against giants of the game, Commerce One and Ariba.
Concur sits on 1.6 million desktops, including those of Lucent Technologies (nyse: LU) and Sprint (nyse: FON) employees. Other blue chip customers include Gillette (nyse: G), AT&T (nyse: T), Texaco (nyse: TX) and Monsanto (nyse: MTC). All of these companies are likely customers of the new and expanded Concur procurement network. "Concur has a less than 2% market share of the e-procurement business, but it is a company to watch out for," says Anna Giraldo-Kerr, a business-to-business electronic commerce analyst with International Data Corp. (IDC) in Framingham, Mass.
But it's not going to be easy, predicts Hambrecht & Quist's Morton. "They will have to work hard to establish themselves in this space," he says.
Nevertheless, even with a small penetration rate, Concur can add a zip to its sales and earnings, Morton says. Hambrecht & Quist estimates that Concur sales will reach a shade over $40 million for year 1999 and $72 million for year 2000.
Concur went public in January 1999 at $14 a share, has seen its stock soar to a high of $59, but is now settled at around $23--giving the company a market capitalization of under $500 million.
At a recent $23, the stock is trading at mere eight times sales, a bargain compared to Ariba, which is selling for 60 times 2000 sales, Morton says. If investors pay Concur any attention this week, its stock is unlikely to remain cheap for very long.
forbes.com |
