Where was Bert Parks?: Eager start-ups submit to TeleStrategies pageant

Never missing an opportunity to spread their message, leaders from five relatively new players in the telecom billing space lined up in front of a panel of venture capitalists at TeleStrategies' Billing 2000 conference in Washington last week to deliver brief, high-level pitches intended to spark interest among investors.

The companies, Telution, Usha Communications, RateIntegration, eVergent Technologies and AP Engines, made their public pleas to a panel that included representatives from Bear Stearns, MC Venture Partners, J T Venture Partners and Spectrum Equity Investors (see table).

Solutions ranged from comprehensive to specific. Telution CEO Kent Steffen pitched his comprehensive billing, customer care and order management solution, calling it a "sustainable advantage." The company's Communication Exchange is a component-based, Web-focused customer expectation management solution that combines these three applications into one system.

"To us, it's all about providing the next generation service provider the tools they need to manage interactions with their customers from end to end, all the time, no exceptions," Steffen said.

While Telution has youth and energy on its side, Usha touts a management team that has, on average, 21 years of experience. Usha also offers a full range of services made stronger by a large team of developers and integrators. "The difference between us and other start-ups is that we have 400 software professionals in our organization," said James Latham, executive vice president of global marketing for Usha.

Neil Sheth, vice president of MC Venture Partners, pressed Latham on the necessity of such a large work force, which is based primarily in India. Latham defended the size, noting that it has helped Usha win bids against Kenan, Saville Systems, Daleen Technologies and Amdocs. Latham taunted his larger competitors, saying, "you spend $1 million on your booth, but what do you spend on your customers?"

RateIntegration, by contrast, had one message: They rate. Founded last year, RateIntegration's 25-member cast of mostly PhDs developed a stand-alone product that founder and CEO Matthew Lucas claimed can rate anything. "We don't do mediation. We don't do billing and customer care. We don't do inventory. All we do is rate," Lucas said.

One of RateIntegration's missions is to help providers with legacy systems leverage their investment in existing operations support system (OSS) infrastructure by avoiding forklift upgrades when trying to modernize. "We defy you to define the most complex pricing requirements or the most simple. We'll show you how to rate it," Lucas said.

eVergent, currently a wholly owned subsidiary of Infotech Solutions, is looking for $20 million based largely on its 200 man-years of experience, its focus on the wireless market and a software suite that addresses account creation and administration, billing, work force automation, rating, inventory control and customer care.

"Transactions are getting more and more complex, often involving multiple [people]," said Vijay Sajja, chairman and CEO of eVergent. "We have figured out over the years how to solve complex problems."

The final contestant of the pageant, AP Engines' president and CEO Jonathan Sieg, focused less on technology and lineage and more on finances. "The service provider challenge is to widen the revenue stream through more vertical services and be profitable through right pricing," Sieg said.

Sieg's company secured financing earlier this year and is looking for more based on the performance of its modular accounting and provisioning mediation software.

"This market is increasingly mature. For us to [invest] early on in this space, it has to be something special in terms of technology and management," said Michael Kennealy, general partner at Spectrum Equity Investors.

Kennealy would not speculate about which of the five met the criteria based on 10-minute presentations. His company invests in other OSS players such as AI Metrix, Eftia OSS Solutions and Geneva Technology.