1 World Trade Center, Suite 7967
New York, NY 10048
|John T Vaughan, CEO
Hal Brent, EVP
Jim Houghton, CFO
Product Line or Service
MarketDataInsite.com offers a suite of business-to-business web and software based products and services globally to the financial industry in support of back office market data operations. From market data vendor evaluation and procurement, to set up, administration and payment resolution, MarketDataInsite.com will become involved in the entire end-to-end customer experience of market data services for all participants within the financial industry. Serving as a vertical portal, trading hub and infomediary for all national and regional stock exchanges, market data vendors and financial institutions, MarketDataInsite.com will combine targeted content, interactive communications, a searchable knowledge base catalogue, and software applications all created with the purpose of becoming the sole destination site for these industry constituents as they manage market data operations.
MarketDataInsite.com is a unique business-to-business portal because we will not only provide the content and community services now common to other vertical portals, but also, we will market an online, subscription software product that helps market data buyers manage their buying activity and substantially reduce administrative costs. This software, INSITE 3000, simplifies the complex tasks associated with managing the market data services function across organizational borders.
The key deployment philosophies for our services devolve out of our decision to have minimal impact on the existing IT infrastructure of client companies. This means that the MarketDataInsite.com’s product and services should be accessible without the requirement to install either hardware of software anywhere on the client’s internal network or on client machines. Furthermore, risks to corporate security need to be minimized.
There are two major “components” to the MarketDataInsite.com’s service.
The first major component is the Insite3000 application, which is designed to help client companies better manage the administrative challenges presented by market data services. The primary application components for this include a “conventional” relational database management system (RDBMS) and programming tools that manages the interface between the client (the web browser) and the database.
The other major component is the suite of “community” services—vendor catalogs, news, information, discussion, chat, and mail—that will enable users of marketdatainsite.com to communicate with each other. The primary application component for the community is an RDBMS that is optimized for full text retrieval.
With 3000+ institutions spending over $8.5 billion a year on market data services, MarketDataInsite.com’s business opportunity and our targeted customer base are created across two major fronts. First, are the financial firms that are the buyers and users of market data services. These financial firms have a strong need to reduce operating costs, strategically manage market data usage and contend with multiple and complex market data vendor relationships. And second, are the market data vendors represented by the stock exchanges, sellers and other suppliers of market data. These vendors need to efficiently expand their global reach, decrease new customer acquisition costs and streamline back office customer support functions. Combined, these buyers and sellers of market data services constitute our core customer base.
Financial institutions must maintain an increasing number of market data vendor relationships to support the increasing complexity of financial instruments that they offer to their customers. Most institutions maintain over 20 relationships with different data vendors at any one time creating a tremendous back office burden. Global specialization, complexity in the financial instruments traded and competitive issues have all driven to create a highly fragmented industry in which there are over 600 market data vendors offering their services to over 15,000 financial firms with 1.3 million active trading desks. Additionally, competitive forces on the supplier side of market data have created the need to reach new markets via additional channels. This is evidenced with the coming explosion of Electronic Communications Network’s (ECN’s) (over 75 have filed recently with the SEC) and the rapid expansion of stock exchanges (over 203 exchanges currently exist) worldwide.
Marketing/Sales and Distribution
MarketDataInsite.com will employ a B2B e-commerce vertical trading hub business model by assisting both financial firms and market data vendors in customer receivables management with customer transaction records and content able to cross-organizational boundaries. By aggregating a critical mass of key financial firms and market data vendors as our core customer base, our business model will focus on multiple annuity revenue streams that provide value added solutions to all constituents that comprise this marketplace.
Market data vendors will pay us for our ability to reduce their distribution costs, invoice reconciliation costs, sales personnel costs by expanding global reach and productivity improvement by providing them data and trends to allow targeted product marketing and development. Financial firms will pay us for helping in the acquisition and strategic management of their market data services.
MarketDataInsite.com expects the web-based application and community site to leverage each other. The content and community will drive potential subscribers to the software service and the users of the software application will drive usage of the content and community.
The MarketDataInsite.com website is currently in development with the initial launch of an interim site occurring on April 17, 2000. Several large international financial and market data firms are currently involved in the continued development of our vendor catalog and web site services. Concurrently, the beta process for Insite 3000 is underway with Franklin Templeton, CITCO and Gruntal & Co. and their respective data vendors. We anticipate an official product launch early in the third quarter, 2000.
Our direct competition consists of consulting firms that specialize in market data, accounting firms, in-house developed systems and specific client server applications. Most of the competitor’s software is either a set of spreadsheet applications or LAN based software that act as a reporting/tracking tool for managing financial firm’s inventory of market data services.
By utilizing the Internet, we have taken a cross-enterprise supply chain approach to the problem of managing an organization’s market data service costs and its associated vendor relationships. Our approach integrates inventory control, contract administration, and payables/billing in order to automate the tasks of allocating costs of services, reconciling bills against an inventory of products/services/users, and managing changes across organizational boundaries. Currently, MarketDataInsite.com is the only vendor that offers a fully deployable Web based end-to-end application with the market data industry in mind. We do not know of any service or product serving our targeted market like ours. That is, one that provides the entire linked market data service package (contracts, inventory, payables) as a web-based application and that simultaneously addresses the ongoing needs of the market data community with an Internet portal and as such, we have achieved first mover advantage.