InformationWeek

September 29, 1997

Signal Internet Technologies: Online Transaction Tools

By Claire Tristram

ny analyst with the words electronic commerce in his or her job title should enjoy drinking from a fire hose," says Bruce Guptill, Gartner Group Inc.'s research director for E-commerce applications. "I hear from two or three new vendors a day. There's not enough venture capital in the world to keep them all alive."

Yet Signal Internet Technologies, a tiny Pittsburgh company with just one customer for its flagship product, has managed to rise to the top of the pile on Guptill's desk. "They're good," he says simply. "Good product, good developers."

Signal's SegWay 2.0 is a specialized tool for building online transaction syst ems between manufacturers and their distributors. It's priced at $45,000. SegWay creates what Guptill calls "seamless links" among business processes. For example, an online order from a distributor will automatically create transactions in inventory, shipping, and accounts payable systems. SegWay is powerful enough to let users create specialized online business systems themselves, instead of hiring consultants to do it for them.

Before founding Signal Internet Technologies in 1995, Joseph Parker spent several years building custom information systems, then developed and sold a specialized software package for the automotive aftermarket. SegWay 1.0, more of a prototype than a first version of the current product, shipped in May 1996 and sold to just eight customers. SegWay 2.0 followed in June of this year, and to date has been sold to just one customer, Tire Centers Inc. in Akron, Ohio, the largest U.S. tire distributor.

"I admit we took a conservative approach," says Parker of his company's slow s tart. "We tested the concept. Then we built it. Only after we built it did we start to market it. It's only in the last two months that we've had any marketing department whatsoever."

Nonetheless, Signal has distinguished itself from other startups by being profitable in 1996, its first full year of operation. The company has the modest goal of tripling sales this year, and it recently received a second round of funding.

In an era where hype often precedes product delivery by several months, Signal's approach is, at least for SegWay 2.0's only customer, a refreshing change. "I know we're the first customer, and I don't have a problem with that," says Steve Lefkowitz, controller of Tire Centers. "Signal's competitors all said, `Sure, we can do that, but we gotta build it for you.' Signal said, `Sure, we can do that, and here it is.' Signal's product already really did what we needed."

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