Online marketplaces are websites with a “many-to-many” business logic. They can host multiple suppliers trading with multiple buyers via different e-commerce tools available as a part of a website functionality.
Why are online marketplaces great?
Online marketplaces can provide a substantial added value to its users. For example, buyers can quickly compare and select better offerings without the need to research multiple websites and surf online for price comparisons or product specifications. Additionally, marketplaces bring more transparency, trust, and standardization to the whole process of sourcing.
On the other hand, suppliers benefit in that they can get a more targeted audience streamlined directly to their product or service pages. In fact, a well-represented company profile with a specifications-rich catalog can be a powerful lead magnet for potential customers.
Both buyers and suppliers benefit a lot if a marketplace leads a role in the operational activities, such as bidding, quoting, invoicing, consulting, basic customer support etc. There are marketplaces out there which do exactly this.
Normally, marketplaces include catalog search capabilities, options to quote and place orders online, as well as payment options to finalize a purchase. Sometimes, marketplaces support different rating or verification algorithms to make sure the website users -- either suppliers or buyers -- are reliable business partners to deal with.
Marketplaces for life sciences
The life sciences sector is prone to embrace e-commerce as a general business paradigm. For example, in a recent PwC analysis it was suggested that by 2020, e-commerce sales in the life science research market would approach 80 percent, with traditional sales methods (emails, conferences, paper journals and ads) declining down to 20 percent. Since marketplaces are a big part of e-commerce in general, they will certainly have a bright future in the area of life sciences.
Let’s review some of the marketplaces operating the domain of life sciences research.
Science Exchange is a web platform for outsourcing scientific research where academic institutions or commercial companies, buyers, can order research expertise and services from a network of individual scientists, research labs or contract research organizations (CROs) -- suppliers. While the marketplace covers a broad range of scientific areas, with brands like SpaceX and NASA among the users, Science Exchange has a strong presence of major life sciences brands, like National Institute of Health (NIH), Gilead, Sanofi, and Shire, to name a few. It claims to have 2,500+ different service providers using the website.
he platform has pre-established contracts in place protecting user’s intellectual property and confidentiality, so no additional operational or legal tasks are needed on the side of buyers and suppliers to start doing business.
Science Exchange has a support team of research consultants called “concierge service”. They assist communication between buyers and suppliers at all stages helping with service search, quote comparison, negotiation and concluding a deal. The marketplace retains a fee for its services which is a percentage of a contract value.
The company was founded by Elizabeth Iorns, a New Zealand scientist in 2011 and up to now, it has raised $30.5M in 4 rounds of investment.
Scientist (formerly Assay Depot)
Scientist.com is a network of public and private e-commerce marketplaces that connects buyers and suppliers of research services. Similarly to Science Exchange, it provides a powerful tooling for R&D outsourcing of all sorts -- with a strong operational support, 24/7 research consulting service, and all the needed administrative and legal contracts in place for the seamless business interaction between users.
In contrast to Science Exchange, though, the Scientist is focused primarily on the area of life sciences with a majority of service providers and buyers being from pharmaceutical and biotech industries. The website users include world’s leading biopharma brands -- AstraZeneca, Bristol-Myers-Squibb, Novartis, Pfizer and alike. The website claims to have above 17,500 research service providers. Scientist.com retains a transaction fee for its services.
The company was founded in 2007 by Kevin Lustig, Chris Petersen and Andrew Martin with the first online marketplace launched in 2008. By this time, the project raised $31M in 4 rounds of investment.
It is interesting to note that in 2012 Scientist took part in organizing open science challenges in US regions for researchers and young scientists.
Chemspace is an open marketplace for searching and ordering specialized chemical compounds -- building blocks, which are demanded in early stage drug discovery research and medicinal chemistry programs. Chemspace currently hosts more than 50 suppliers of fine chemicals and the aggregated catalog of chemical building blocks totals 30+ million unique structures. The main focus of this marketplace is to provide medicinal and pharmaceutical chemists with a comprehensive coverage of previously unchecked chemical space and stimulate new synthetic ideas.
The marketplace is equipped with a chemical structure drawing tool (MarvinJS) and a sophisticated search module with different advanced filter options. It is possible to surf the catalog by chemical structure, CAS number, MFCD numbers, IUPAC name, catalog identifiers, and InChI keys.
Chemspace operates as an open platform meaning any qualified supplier can join freely and sell compounds at this marketplace without a service fee. Chemspace is generally not involved in managing operational activities on the side of buyers or suppliers and its role is limited to providing a comprehensive searchable database of compounds with an access to supplier’s e-commerce.
The company was founded in 2015 as a joint effort of several leading fine chemicals suppliers -- Enamine Ltd, ChemBridge Corporation, UORSY and FCH Group -- to create a “one-stop-shop” for searching and ordering building blocks online. It is based in Riga, Latvia, and has representative office in the United States.
Molport is a Latvian chemical marketplace offering primarily two classes of fine chemicals for drug discovery research: building blocks -- for medicinal chemistry and custom synthesis programs; screening compounds -- for early hit exploration programs.
The marketplace hosts online catalogs from more than 40 suppliers of fine chemicals, the total number of stock compounds exceeding 6 million. Molport supports chemical structure search (MarvinJS), as well as different text search options with multiple advanced filtering capabilities.
Molport takes care of some operations and logistics to assist buyers, for example, they can consolidate shipments from multiple suppliers into one package. The service fee for the marketplace use is reflected in the pricing for the compounds ordered.
The company was founded in 2006 and has attracted $1.34M in 3 rounds of investment ever since.
Quartzy is a hybrid service combining a lab management software and a marketplace of lab consumables and reagents. In this model, buyers are essentially users of the lab management software designed to manage lab inventories, lab procurement process, spend control and payments. With the software comes a marketplace so that users can search for products from different suppliers hosted within Quartzy catalog.
The service is free to use for buyers (labs), while suppliers have to pay a service fee to host their catalogs. The platform gained over 100,000 customers with well-known academic institutions among them -- Stanford, Oxford, Columbia University, Duke, as well as prominent industrial players.
The company was founded in 2009 by Jayant Kulkarni and Adam Regelmann, and is based in Palo Alto, CA. It has attracted $22.2M in 3 rounds of investment so far.
Innocentive is an open innovation marketplace connecting companies -- seekers -- with a wide network of scientific or engineering professionals -- solvers. Seekers can publish offers to solve a particular research problem for a fixed cash award -- so-called “open innovation challenges”, while solvers can provide their offers to solve the problem. The platform has all the legal documents in place to make sure any intellectual property or confidentiality matters are in check.
As of present time, the solvers' network counts more than 380,000 specialists from nearly 200 countries.
The company was founded in 2001 in Waltham, MA, with a major seed contribution from Eli Lilly and Company, and later in 2005, the Innocentive was spun out of Eli Lilly. Innocentive has a representative office in London, UK. To date, the project has raised $30.3M in 4 rounds of investment.
Labs Explorer is a relatively new project founded in 2016 in France. The platform is essentially a catalog of research organizations and companies with the ability to add services in the company page. The website supports text search functionality where buyers can find information about suppliers and their services. The full e-commerce workflow is not yet realized but can certainly be expected in the future.
The products and services listed at Labs Explorer can be quoted through the marketplace. While the website is free to use for both buyers and suppliers with the ability to create a company profile with product/service page, Labs Explorer retains a 10% fee on all the trading transactions arranged through the marketplace.
Biocompare is not a marketplace in a sense, rather it is an online catalog of products and a resource for up-to-date product information, reviews, and new technologies for life scientists. Still, it is of a great value for consumers of scientific products, facilitating a decision-making in the process of research procurement.
The company was founded in 2000 in San Francisco, CA as a buyer’s guide for life sciences.
Please, feel free to leave your comments below and suggest other interesting marketplaces in the area of life sciences.