Financial services giant American Express Company (NYSE: AXP) and Ventro Corporation (Nasdaq: VNTR) announced an agreement Thursday to create MarketMile LLC, an Internet-based marketplace from which businesses will be able to purchase products and services.
MarketMile, which represents American Express’ first independent e-commerce startup, will initially target mid-sized companies and then expand its reach to both large and small businesses. Customers will be able to purchase office and industrial supplies, computers and peripherals, as well as such business services as temporary personnel.
The companies estimate that the overall market for such products and services will exceed $1.4 trillion (US$).
Initially, American Express will assume a 65 percent ownership stake in Marketmile, while Ventro will own 35 percent. John Corsi, interim CEO of Ventro, will lead the effort.
The Board of Directors includes Ed Gilligan of American Express, who serves as Group President of the company’s Global Corporate Services, Pierric Beckert, Senior Vice President of Interactive Investments at American Express, and Robin Abrams, Chief Operating Officer of Ventro.
Ariba To Power MarketMile
MarketMile will utilize the technology of Ariba, Inc. (Nasdaq: ARBA), which supplies software systems to numerous business-to-business (B2B) Web sites. Ventro licenses Ariba software as a major component of its platform for all of its marketplaces.
American Express and Ariba have worked together before. Thursday’s announcement comes two months after AMEX, Ariba and VeriSign (Nasdaq: VRSN) announced a strategic partnership to develop an integrated card payment processing utility for online business-to-business transactions.
Shared Purchasing Data
The new company plans to offer reduced merchandising, customer service and transactional costs using the purchasing data acquired through the billing process from American Express’ 50,000-plus suppliers.
“Our aim is to deliver an efficient marketplace that can scale up to handle the demand of American Express’ diverse corporate customer base and our business-to-business supplier network,” said Gilligan.
American Express will become a MarketMile customer, and access to the new service will be offered to Ventro’s five operating companies: Chemdex, Promedix, Broadlane, Industria Solutions and Amphire Solutions.
MarketMile will be headquartered in Mountain View, California, where Ventro is currently located.