The U.S. Chamber of Commerce tomorrow will unveil its first for-profit venture, a Web gateway called ChamberBiz that aims to link small businesses around the country and provide them with relevant news and information.
The chamber is joining a rush into the market for business-to-business Web commerce, which is predicted to grow from $109 billion in 1999 to $1.3 trillion in 2003, according to Forrester Research.
ChamberBiz is funded by Rajendra Singh, a prominent Washington area telecommunications investor who often lands on lists of the wealthiest Americans.
Through Telcom Ventures--his venture-capital firm, which has also helped launch Teligent Inc., LCC International Inc. and XM Satellite Holdings Inc.--Singh will invest $24 million in ChamberBiz, which will officially be launched in December.
Under the terms of the deal, Telcom Ventures of Alexandria will own two-thirds of ChamberBiz and the Chamber of Commerce--a nonprofit association of businesses and business groups--will own the remaining third.
Rahul C. Prakash, president of Telcom Ventures, said he thinks of the site, which will be found at www.chamberbiz.com, as a grass-roots campaign, linking business owners to each other and to information that will help them run better companies. "Look at a dry cleaner in Iowa. You give him a powerful way to get into the market," he said.
ChamberBiz could create a customized Web site for the dry cleaner, for example, that would include industry news and provide a conduit for buying store supplies and other e-commerce. "The design of the site is to help [businesspeople] solve daily business problems," said Robert J. Perkins, developer of ChamberBiz.
The portal intends to make money from such arrangements by selling advertising and making joint marketing deals.
Singh said when chamber chief executive Thomas J. Donohue and Perkins came to him with the idea, he saw it as a great deal because the chamber has a well-recognized name and a captive audience of 3 million members. Like his telecom investments, he says, ChamberBiz has great growth potential.
The new portal has been created as a separate entity from the rest of the chamber, so it could potentially be spun off as a public company.
"You have to compete by Internet rules," said Perkins, who came to the chamber about a year ago from Playboy Enterprises Inc., where he was an executive vice president. Donohue hired Perkins to make money for the chamber through for-profit projects.
The plan of the site, which the organizers say is somewhat of a moving target, is to launch fast and then make changes as they go along. "We are getting dressed on the way to the prom," Donohue said.
Still, the market is becoming crowded. America Online Inc. of Dulles has said it will start offering services in this area, and Microsoft Corp. also has a new small-business site, called bCentral.
"We see ourselves as a community-of-interest site," Donohue said. "We're not worried about what Microsoft is doing."
But Donohue does admit that the new site takes the chamber into a new--and risky--online world. He says he tells his colleagues: "I'm excited, but if you don't share my fear about this, then you don't have blood pumping through your veins."
CAPTION: Investors Rajendra Singh, left, and Rahul Prakash, president of Singh's venture-capital firm Telecom Ventures, announce plans yesterday for a Web gateway that will serve as a link for small businesses.