StarCite Fully Integrates RegWeb In Buy

Philadelphia-based online meeting portal StarCite last month purchased the RegWeb online attendee management application from the company's longtime partner, Cardinal Communications. As part of the deal, three key Cardinal executives, including CEO Rodman Marymor, join StarCite as part of a new West Coast office.

The acquisition further cements StarCite's efforts to create an integrated Web-based system that combines several corporate meetings management functions. StarCite and Berkeley, Calif.-based Cardinal in April joined forces with Alexandria, Va.-based technology company Outtask's upstart online booking application Cliqbook to offer an integrated application that enables meeting attendees to book air travel at negotiated rates at the point of online registration. That deal was an extension of the initial partnership between StarCite and Berkeley, Calif.-based Cardinal, formed in late 2000, to integrate RegWeb into StarCite's suite of data consolidation and supplier sourcing tools.

The deal moves the industry even further down a path of close alliances among attendee management, sourcing and procurement and booking systems. GetThere developed an attendee management function after it purchased AllMeetings; SeeUthere Technologies formed alliances with TRX, KDS and Galileo's Highwire booking system; and now StarCite, RegWeb and Outtask have partnered.

"We both knew that the power of being one is stronger in the marketplace than if we had continued to go it alone," said StarCite CEO John Pino. "This was not a new thought. We had been working on this for more than one year. When you know as much as we do about each other, it makes the next step a comfortable one. We always envisioned there might be a bigger relationship. We wanted RegWeb, and that's what we went with. Cardinal did not hold an auction."

Though the sale sparked industry speculation that the sale of RegWeb may be part of a larger deal involving StarCite and another party, Pino strongly denied any such insinuations. "This is a step in our overall grand plan of growth, nothing more," Pino said. "There will be no sale of StarCite. We are in this for the long term and we're going to fight like hell. It's harder to sell any part of the meeting purchasing process by component. Everyone has to have their own or have a partner."

Pino pointed to other technology pieces, including procurement, compliance and data analysis tools, to be integrated in meetings technology systems "before they can truly be end to end."

Pino expressed some caution at the flurry of technological development in the industry and the possibility that the level of potential functionality might outpace actual buyer demand.

"We talk about that a lot and there's a danger we are doing that," Pino said. "We're so focused on building a meetings management platform, but nobody knows what the real value is."

Nonetheless, Pino pointed to two main sources of corporate interest in StarCite's tools thus far: procurement departments of large corporations that want detailed requests for proposals and internal planners at corporations without policy mandates who are trying to solve immediate problems with specific meetings. "So we're seeing big hits from the top of corporate management down and from the bottom up," Pino said. StarCite officials said more than 300 companies are direct clients of RegWeb or use the attendee management tool through StarCite.

Key to the deal was the assured future involvement of Marymor and other Cardinal executives, who offer StarCite the abilities of the people who developed the application. Marymor will not leave Cardinal and remains the company's CEO in its Berkeley office. "It gives me a more official reason to become more formally involved," Marymor said.

Marymor has been a proponent of the integration of the various types of meeting technology developed in the past few years, including attendee management, sourcing and booking tools.

"We are moving to the next generation of software applications in this industry," Marymor said. "The tools that people use are going to need to work with other tools. We have a clear vision of how everything should look, and we're close—we can see it, taste it. But whether companies partner, acquire or build, this is where the demand is. This is a significant benchmark."

StarCite's competitors acknowledged this is emblematic of the direction of the meetings technology marketplace. "It's the right thing and a smart move," said Ed Tromczynski, president of Twinsburg, Ohio-based PlanSoft. "The companies in this space that will provide service for a long time will be those with full product sets, whether through formal partnerships or acquisitions."

PlanSoft has formal partnerships with several Internet companies that provide attendee management or housing and registration services, including B-there, SeeUthere and Passkey. "Even without an acquisition, customers of PlanSoft and StarCite want end-to-end solutions and need to know that the housing and registration piece is there," Tromczynski said. "I don't know enough about StarCite's business model to say whether buying or partnering is better for them. PlanSoft has looked at similar partnerships, including M&A activity, but we have not found a scenario that works with our business model." Santa Clara, Calif.-based SeeUthere also has chosen to partner instead of merge, but vice president of marketing Helen Loh said the key to any such solution is the integration between attendee management and booking.

"This is just the latest example of an industry trend that has been going on since 2001," Loh said. "Overall, the technology players are recognizing the need to provide an integrated solution for managing meetings; not just automating logistics one by one. Based on our experience, the integration of attendee management with air booking is the first and most important link in an end-to-end solution. There is immediate ROI since there is hard dollar savings from online booking versus offline booking."

Loh, though, pointed out what she considered the pitfalls of aligning with a single online booking system. "SeeUthere was the first meeting technology provider to pioneer this agnostic strategy, in order to offer corporate clients a truly end-to-end solution regardless of their existing air booking system," Loh said. "By contrast, if a meeting system integrates with only one air booking system, then for the corporations that do not use that booking system, the solution is not end to end."