R.I. company helps move jewelry behind the scenes

It may be the biggest and most successful Rhode Island company you’ve never heard of: The Corporate Marketplace Inc., based in North Kingstown, has grown into an e-commerce powerhouse, ranked No. 73 last year on Inc. magazine’s list of fastest-growing private companies – No. 8 in the software category – with 1,868.3 percent growth in revenue from 2003 to 2006, to $13.8 million.

But it is no accident that TCMPI is not well-known. Being invisible, says CEO Chris Crawford, is a big part of the company’s success. Its private online stores connect buyers seamlessly with sellers of fine jewelry and other valuable items.

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PBN: You’ve been in business for several years now.

CRAWFORD: We started in 2000 … as a jewelry procurement hub for the Corporate Premium Incentives Distribution Channel. … I had worked for a number of the larger jewelry manufacturers and as I traveled around the corporate arena and saw how these guys went about procuring products to use as rewards and incentives, it was archaic. … They’d have sales people come and visit them … get the product in, shoot photographs and write copy into whatever kind of program they were going to run. Often these things would be run through third parties, agencies they would hire. So what we did is we developed a purchasing hub and gave the software to everybody, both on the manufacturing side and on the potential customer side, and that way we ingratiated ourselves into both entities by not charging them, and they became reliant on us. … And a process that took them months, we simplified it to where it would take them no more than 10 minutes.

PBN: How did you put together the software?

CRAWFORD: We wrote everything ourselves from the ground up. We procured nothing, we own all of our software and all of our hardware, and we have completely redundant systems in Colorado, so if anything happens here, we’re up and running there instantly. The nice thing for us was all the jewelry manufacturers located here in New England allowed us to get a head start, and these were the same manufacturers that were making products for the better retailers in the world, like Tiffany’s, Bloomingdale’s, Saks.

PBN: Is this like the Amazon model, except taken to a closed, B2B setting?

CRAWFORD: It’s kind of funny you should mention that. When Amazon wanted to launch jewelry, they came to us. So we go up into the Amazon system every 15 minutes, we pull the orders down, dissect them, drop them into 42 different factories, ship them out the door, and give all of the tracking stuff back to the Amazon customer, and all that Amazon does is take a nice, healthy chunk off the top. … We signed our first contract with them five years ago, and we just re-upped with them a year ago December. We’re about to download in the next month about 10,000 new SKUs into that Amazon storefront. And we do it for a lot of other people, invisibly, without anybody knowing it’s us doing it.

PBN: How do you get your revenue, from a cut of the sales?

CRAWFORD: We started out by charging the equivalent of “rent” or ad space; we eliminated that and now we just do a transaction-based model. And the manufacturers like that because there’s no cost on their end until it’s a sold order.

PBN: How small did you start, and how did you scale it?

CRAWFORD: Just me. And I borrowed against everything I could borrow, I used up my entire 401(k). I went to the banks, but … in terms of trying to lend money against software and computers, you couldn’t get a single bank in Rhode Island to do it. Finally, the [R.I. Economic Development Corporation], which had a small-business development fund, did lend us money. … I paid that loan off very quickly, and the banks suddenly got interested. Sovereign Bank in particular has been absolutely wonderful. … [By] 2005 the VCs were knocking on our doors left and right, and we found a perfect match, Ascent [based in Boston].

PBN: How much does improving your software drive growth?

CRAWFORD: 110 percent. Right now we could take on a ton of new customers; we’re projecting a minimum of 65 percent growth this year, without adding any other people, because the system absorbs all that growth. It can handle over a million transactions a day. … And we have two people who do nothing but tweak it; they sit there and write code every day, different adaptations.

PBN: What are your priorities in that tweaking?

CRAWFORD: I hate to say it but new media. Today if your site doesn’t sizzle, wow people, on a consistent basis, then you’re behind the times, and it’s very easy to get complacent. But the reality is the day you launch a new Web interface, you better be working on the next one, because it’s just changing so fast. …

PBN: How important is it for you to be invisible to users?

CRAWFORD: Very, very important. We predominantly sell through distributors who have a relationship with the real customer, the end user. What we do is offer to solve the problem the distributor has and facilitate all sorts of transactions so that corporate entities can run their programs. We might be able to get to one entity directly, but we can use that distributor to get to 10 or 20.

PBN: Is being in Rhode Island an advantage or disadvantage?

CRAWFORD: Certainly when we started it had a big advantage, because we started as an incubating company on South Main Street [in Providence] under the wings of a company called Fraunhofer, which is the largest R&D computer graphics company in the world. … They employ 16,000 or 20,000 people. They picked Rhode Island as their U.S. headquarters, and I was so angry when they left the state because of a lack of cooperation between Brown University and different state agencies to try to keep them here. … But the talent they were relying on was coming from [the Rhode Island School of Design] and Brown, and we reached out to the colleges, and we have on staff, 12 months of the year, interns from URI, Bryant, Brown, Providence College.

PBN: Rhode Island has been trying in the last couple of years to be more supportive of IT as a growth sector in the economy. How do you think it is doing?

CRAWFORD: I give all the credit in the world to the [work done] in the past 12 months. I think Jack Templin [co-founder of the Providence Geeks] has been fantastic in developing a bit of a buzz and a communication network. … He’s put together some creative ways for companies to tap into that, and through these monthly Geek dinners, he’s done something significant. And Saul Kaplan, who’s now running EDC, certainly has his hands on the benefit of supporting that. Our wages are much higher than the average wages here in Rhode Island, and the more you build that, the better it is. •