A while back I wrote about Vertical Supplier Information Management, but I did not do the topic justice. The term “vertical SIM” is insufficient to describe what the best of these providers offer– not just industry-relevant information collection–but actual credentialling and standardization.
Successful vertical credentiallers either proactively convince buyers to agree on a set of standards, or create their own standards and get big enough, fast enough to become a defacto standard for the industry before buyers and suppliers know what hit them! This standardization creates real value for both parties. A horizontal SIM business is often just a series of portals for buyers, but a vertical SIM provider can be a true many-to-one-to-many network.
There are a surprising number of sizeable pure-play companies in this space that remain private. But in this market environment, I would not be surprised to see some go public and/or merge. Examples include:
- ISNetworld which began in safety credentialling in capital-intensive industries. This is my favorite company of this genre and is a simply beautiful business. Inc. magazine reports that ISN’s revenue in 2013 was $82.4 million up from just $36.9 million in 2009.
- ISNetworld has spawned a zillion wannabes. I’m only going to list one of them in deference to ISNetworld. The largest competitor seems to be PICS Auditing which OneSource lists as having $20 million in revenue. PICS took on a $35 million minority VC investment in January, so there is some substantial perceived value there already.
- Achilles Group, Ltd. has been doing supplier credentialling in a series of industries beginning with oil and gas in the Nordics and utilities in the UK. They have very little US revenue but reported about $83 million in revenue in 2012.
- Vendormate provides credentialling and other services in healthcare (hospitals). Healthcare Informatics lists their 2013 revenue as $25 million up from $17 million in 2011.
I’m sure there are other large companies in this space that I am forgetting or overlooking. (If you know one, please comment.) And there are many more that are smaller. Also, most commerce-oriented Industry Cloud providers offer credentialling as one of their lesser services. None of these providers listed above, however, engage in commerce transactions. The combination of facilitating commerce and facilitating credentialling is one that few platforms have successfully pulled off either in the consumer space or the enterprise space. Perhaps this will happen through acquisition.
Recently pics auditing has made big changes. Such changes include an outrageous increase in annual costs which they say are justified by no increases over the past three years. They say that the contractor needs to register or no more work for them. Does the term blackmail come to mind? You can’t simply submit your insurance information to the client site you want to work for. You have to pay pics auditing to simply confirm what you and the client site already know. Look up the term blackmail and I think that pretty much sums it up. Don’t be another sucker fight for your right to run your business the way you want to. Don’t let the dictatorship of pics auditing and their cohorts determine the success of your hard earned business. I thought this was the land of opportunity. I guess pics and the lure big business might just win over the true American dream. “The love of money is the root of all evil.” Wonder where the executives of pics are going to wind up? Just a thought.