Iasta.comInc. From chemicals to coatings E-sourcing software streamlines purchasing cycle
Companies wanting to gain a strategic foothold in today's fast-paced Internet-based supply chain marketplace are turning to companies like Indianapolisbased Iasta, an e-sourcing software and services company.
Co-founder David Bush, senior vice president for business development, said Iasta's software product allows companies to be more competitive in tracking work flow and to conduct reverse auctions where suppliers can bid for their business.
An Indiana University environmental science graduate, Bush started EcoSearch Environmental Resources, an environmental database company, in 1996 with business partner Todd Eppe. The pair blended their information technology and environmental science backgrounds to develop Internet business-to-business applications. Soon, they saw an opportunity to move into the emerging e-sourcing industry. In 2000, brothers Jason and Mike Treida joined Bush and Eppe in starting Iasta.comInc.
"We saw a large market opportunity and relatively average software out there," Bush said. Only a handful of companies provided similar products in this global industry, including Sunnyvale, Calif.-based Ariba Inc. and Burlington, Mass.-based Emptoris Inc.
Essentially, Iasta's software streamlines the purchasing process, giving companies leverage with their supply base to get the best possible prices.
Ken Jones, a former purchasing director at Roche Diagnostics who now leads Ivy Tech Community College's Business Administration Department, said Iasta's product reduces the typical two- to six-month procurement cycle to about a month.
"The old way required a lot of back and forth negotiations to reach the best [price]," Jones said. "If it was a significant expenditure or a unique component that makes up the 'DNA' of your product, you went through some pretty serious due diligence."
With Iasta's product, clients are preapproved and familiarized with the software. On the bidding day, suppliers log on to a Web site to make an offer.
"The bell rings, so to speak, and it's almost like the Kentucky Derby-suppliers are off to the races bidding on business," he explained. And within 30 to 60 minutes, the bidding is over and the price is set.
Diana Cosgrove, purchasing team leader for Indianapolis-based Roll Coater, a coil coating company, said Iasta's software has given the firm a way of communicating with all five of the company's satellite locations.
"Everyone has immediate access to information at one location instead of having to wait for someone to dig up their old e-mail," she said.
Bush, 35, said Iasta's software provides a large amount of functionality for the price when compared to its competitors.
While the partners didn't have a formal plan when starting out, Bush said they "definitely had an idea where we were going and what we wanted to do with the business."
"We never sought outside funding," he said, though the startup costs ran close to $250,000. "As officers, we didn't take a salary for a year and a half. You can control costs quite a bit that way."
Still, establishing brand recognition in the highly competitive software industry was challenging.
"Getting the first five to 10 customers was by far the most difficult thing," Bush said. "We had to convince Fortune 1000 companies that we could perform."
Louisville-based restaurant operator Yum! Brands Inc. was among Iasta's first clients. Today, Iasta has 30 employees, including sales reps in Philadelphia, Atlanta, Denver, London and Brussels. The business has grown about 100 percent each year, and is on target to repeat the feat this year. The future, Bush said, is "very bright."
"Even though this industry has been around for about 10 years, it's still in its infancy."