Internet Commerce: NetGateway Outlines Aggressive Acquisition Strategy in Support of Its Internet Commerce Center

Internet Commerce: NetGateway Outlines Aggressive Acquisition Strategy in Support of Its Internet Commerce Center

NetGateway Inc. Thursday outlined an aggressive strategy to acquire companies that will drive commerce transactions through its Internet Commerce Center (ICC).

NetGateway is a company dedicated to the implementation and management of all phases of Web-based, business-to-business commerce for the emerging $400 billion Internet Commerce market. The company’s proprietary Internet Commerce Center is one of the first vertically integrated infrastructures designed to provide all essential service functions necessary to organize the Internet for business-to-business commerce.

“Ours is a clear strategy,” stated Keith Freadhoff, chief executive officer. “We do not confuse Internet use (e-mail and Web site hits) with Internet commerce. A mistake many companies make is believing high use equates to commerce profits. There is little correlation between the two, as is well documented by many researchers such as the International Data Corp.

“Those companies with fragmented solutions serving the Internet commerce market that have not recognized this have registered huge losses sitting in the cyberspace waiting room. Our focus is on organizing Internet commerce for those that must use the new Internet opportunity to sustain and enhance competitive advantage.”

Key to NetGateway’s strategy is control over the velocity of transactions (and thus revenue) through its Internet Commerce Center. Traditionally, this is done indirectly, through client companies that utilize the ICC, paying NetGateway a percentage of all transactions.

However, the company plans to greatly accelerate this velocity by acquiring companies that can catapult to new levels of sales and profitability through the use of the fully integrated Internet commerce infrastructure of the ICC.

“We are not going to build an infrastructure and then sit back waiting for people to show up. That is a failed strategy,” Freadhoff continued. “Our intention is to control both the source and the Internet transaction mechanism. Our strategy can be summed up as Internet Velocity Control.”

The company has strict criteria for acquisition targets. These are: strong and experienced management, an existing business-to-business client base and a commitment to immediately embrace Internet commerce.

“We are looking for companies that have the immediate potential to ramp their business via Internet commerce. The type of business is less important than the ramp potential of the transition to Internet commerce,” stated Don Corliss, president of NetGateway and leader of the acquisition effort.

“If all the key ingredients are present, then these companies should talk to us, because the marriage with our Internet Commerce Center will significantly increase their sales and profitability, and build a market leadership position in e-commerce.”

NetGateway ( is located in Long Beach, Calif.

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