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Interview Published August 28, 2000

Derek Lidow, iSuppli

iSuppli ( is an El Segundo-based B2B in electronics, headed by former International Rectifier executive Derek Lidow. I asked Derek a few questions about the company:

BK: What is iSuppli, and how are you different from the other electronic components B2B sites out there?

DL: iSuppli has built a high performance supply network that simultaneously manages product, information and cash in a synchronized flow designed to eliminate multiple supply chain inefficiencies and save billions of dollars in costs.

iSuppli takes on supply chain problems in three ways: It eliminates product mark-ups, balances inventories throughout the industry, and delivers parts anywhere in the world within 48 hours. To create unprecedented new efficiencies in high volume sourcing, iSuppli has created a unique three-way partnership with Andersen Consulting and UPS Global Logistics.

The supply network is a dynamic system comprised of iSuppli's team of industry experts, industrial grade Internet technology and a specialized logistics network managed with the help of strategic partner UPS Logistics Group. Customers and suppliers of electronic components are linked by this efficient network to save up to 90% of supply chain costs, with acquisition costs reduced to less than one percent.

Unlike the e-marketplaces and exchanges, iSuppli is an end-to-end solution, from strategic part selection through sourcing, forecasting, price negotiations, planning, shipping, receiving and financial services.

BK: What is your background, and how did you decide to start iSuppli?

DL: After more than 20 years in the electronic component industry at International Rectifier, including four years as the company's CEO, I was all too familiar with the deeply entrenched problems of the supply chain system. I decided to turn frustration into the model for a new system designed to bring efficiency to a business very much in need of it. In 1999, I founded iSuppli Corp., an e-commerce company helping businesses shift from the outdated supply chain model that's unequal to the demands of today's manufacturers to a supply network model.

In terms of my educational background, I earned a B.S.E.E. degree summa cum laude in electrical engineering from Princeton and a Ph.D. in Applied Physics from Stanford as a Hertz Foundation Fellow at the age of 22. In addition, I am a member of the Advisory Council for Princeton's School of Engineering and serve as a trustee of the Los Angeles Philharmonic Association.

BK: Who are your investors?

DL: Andersen Consulting
NeoCarta Ventures
CMEA Ventures

BK: Where is your company in terms of stage - is your service active yet?

DL: The iSuppli network is fully operational and delivering parts to customers. In addition, iSuppli sells information products and services through its SuppliTool Decision Resources group.

BK: What is the next big step for your company?

DL: Achieving a growth rate of 300% per quarter for the next several years.

BK: Has the recent downfall of Internet stocks affected your company?

DL: Not at all, because iSuppli's customers and investors consider us to be several generations ahead of the B2B models that are currently in trouble. If anything, the recent downturn has increased interest in our model.

BK: Finally, what do you think was the hardest part of starting your company?

DL: Convincing customers, investors and potential employees that the exciting vision of a complete supply chain management solution could be turned into reality.

BK: Thanks!

Copyright (c) 2001 by Benjamin F. Kuo. All rights reserved.
May not be reprinted without permission.