Detroit’s H2bid Earns Silicon Valley Accolades, Prepares to Expand
The Detroit-based startup H2bid.com—an e-bidding site that maintains, according to the company, the world’s largest online clearinghouse of water utility contract opportunities—recently made some waves in Silicon Valley.
Company founder and CEO Glenn Oliver says H2bid was invited to be part of a startup expo in Menlo Park, CA, hosted by SV Forum. Fifty companies participated in the event last month, and Oliver believes his company was one of the few from outside the Valley—and the only one from Michigan.
At the end of the event, the participating startups were asked to select the top three companies there and rank them according to their business model. “I thought, ‘I’m from Michigan, nobody will give my company any serious consideration,’” Oliver recalls. In fact, H2bid was selected by attendees as the top company in the room. When the organizer handed him a bottle of champagne to celebrate, Oliver thought she was joking.
“It was a great affirmation,” he adds. “We were really encouraged by the experience overall.”
Oliver says he’s “advanced” H2bid’s business model in the past year to concentrate more on data and analytics, although the company is still focused on bringing the water-bidding ecosystem together. Until H2bid’s services were introduced in 2006, Oliver says there was no centralized method for the bidding-for-contracts process in the water industry.
On H2bid, contractors compete to provide everything from desalination and distribution equipment to tanks and valves to water utilities across the United States and Canada. Oliver says the site uses a reverse-auction process where the contractors, or sellers, bid against each other, which has the effect of keeping prices down. As H2bid uses its recent experience in Silicon Valley to raise funds, Oliver also has his eye on expanding H2bid’s offerings to the developing world.
“The idea is to create a central place that is enormously more efficient than what we have today and bring down the cost of infrastructure by making it smarter,” he says. “It’s a huge deal in the developing world, and even in our country, the infrastructure is crumbling. It’s estimated that $2-3 trillion is needed to upgrade our infrastructure.”
Oliver says 85 percent of the water bids in the United States are posted on his site. “We passed the 200,000-bid mark a while ago,” he says. “Now we’re moving into a phase of analyzing our data and seeing all kinds of business-to-business services we can provide to help the water industry make smarter decisions. There’s a tremendous opportunity for us based on the industry data we’re collecting.”
Oliver points to a Chinese company called Alibaba, which is an online exchange for buyers and sellers of just about every kind of merchandise imaginable, and says H2bid would like to provide similar services within the context of the water industry.
“Our business model is a cross between Alibaba, Bloomberg, and Amazon,” Oliver explains. “We want to own it, and I think we’ve made pretty good headway.”