No Money Down

Entrepreneur, Nov, 1999 by John W. Verity

Making e-commerce as free as free can be

One of the first lessons of life is that there's no such thing as free. Yet the Internet always seems to be on the verge of making that rule as obsolete as a 300-baud modem. Here, after all, is where all sorts of stuff costs nothing beyond the usual $20-a-month access fee - zillions of Web pages crammed with text and graphics, numberless discussion groups, blazingly fast search engines, lifetime e-mail accounts, even international telephone calls.

But surely e-commerce capabilities cost something, right? They did until July, when Bigstep.com began offering to get masses of small businesses on the Web for almost nothing. That includes displaying catalogs, taking orders, publishing customer newsletters, analyzing Web activity, building relationships and a' lot more that small businesses couldn't afford before.

Having seen the success Web-based community sites such as GeoCities and Xoom have had in hosting individuals' Web sites, Bigstep set out to apply essentially the same business model to e-commerce. "Big businesses were benefiting [from e-commerce] a great deal," says Andrew Beebe, 27, Bigstep's CEO and cofounder, "[but] there were a lot of people who were about to be left out."

This is no pre-fab electronic mall scheme, either. Each Bigstep member gets to design, construct and maintain his or her own Web site, with software residing on Bigstep's servers interactively walking them through each step of the process. And later, when it's time to blast out a customer newsletter, Bigstep's server will provide a list of the customers who visited the site and stats about what each one ordered or seemed interested in.

Bigstep is out to make a profit itself, of course, and it hasn't wrung out every cost of doing business on the Web. It plans to sell ads on its site - but not on members' individual pages - and charge for premium add-ons. "What we realized," says Beebe, "is that we would take a risk and place our bets on small businesses. Why charge at the door if everybody's going to be successful? Those that succeed will be interested in buying more services."

The company will process incoming orders at no charge, but to collect credit-card payments, Bigstep members must establish their own online merchant accounts. However, Bigstep has cut a deal with Card Service International that lets members maintain such accounts for a mere $14.95 a month. And members who want to have their own Web addresses instead of being listed under Bigstep's umbrella must pay the standard $70 registration fee, but Bigstep will handle the registration at cost, with no markup for itself.

"Free" still may not be entirely free, but Bigstep seems to live up to its name in approaching that goal.

John W. Verity reported and edited for 23 years at Electronic News, Datamation and Business Week. Since 1997, he has been freelancing from his Brooklyn, New York, home.