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Princeton eCom aka Princeton Telecom: an IPO
These articles by Barbara Fox were published in U.S. 1 Newspaper on April 7, 1999. All rights reserved.
Two years ago Princeton TeleCom was helping big banks
deal with electronic payments. Now the 16-year-old firm is using the
same technology to help engineer the fast-moving E-commerce train.
The Research Park-based firm has changed its name to Princeton eCom
Corporation, and last week it filed an S-1 registration — a preliminary
statement — with the Securities and Exchange Commission for a
$46 million initial public offering, to be managed by BancBoston Robertson
Stephens and Donald, Lufkin & Jenrette. For a prospectus call 415-781-9700.
The stock would trade on Nasdaq under the symbol ECOM.
Princeton Telecom, now Princeton eCom, is already a leading provider
of Internet bill publishing and payment services for large businesses
and financial institutions. It was founded by Donald Licciardello,
a Princeton University physics professor and an alumnus of the University
of Scranton, Class of ’68, and the University of Virginia; he currently
owns 62 percent of the stock.
Princeton eCom had 56 workers in 1997 and has 80 employees now, all
located in 11,000 square feet at Research Park. In its expansion mode
the firm says it needs to hire experienced sales professionals plus
expertise in market research, public relations, marketing, trade shows,
speaking engagements, and web site marketing.
The prospectus notes that the firm has had net losses in each of the
past five years, and that losses increased last year by 57 percent,
going to $3.4 million in 1998. But revenues grew 26 percent to $3.8
million in 1998. Billing Concepts, based in San Antonio, Texas, has
a $10 million investment in Princeton eCom and owns 23 percent of
the 2.3 million existing shares. No share price or share volume has
been made public.
Ronald W. Averett, 42, was made president and COO last month. He helped
spin off Chevy Chase Bank’s credit card business last December, and
he has also worked at Advanta and Citibank.
As an outsource solution for bill presentment and payment, the firm
has brand neutral products that eliminate the need for companies to
generate and mail paper bills as well as the need for consumers to
write and mail checks. Among its products are Electronic Lockbox Service,
1-800 PayBill, and the new Internet bill publishing service.
The Electronic Lockbox Service is a back-end service: It delivers
verified payments to the biller’s accounts-receivable platform for
posting. Federated Department Stores, for instance, is a Princeton
eCom customer. The retail customer who uses online banking pays a
bill electronically to Macy’s, and the parent company (Federated)
aggregates the payments and sends them to Research Park.
"Banks that capture these electronic payments send `a check and
a list,’" said Licciardello in an article in U.S. 1 November 5,
1997. He referred to how one big check is accompanied by a list of
payments to be drawn on that check: "The billers hire us to help
automate those `check and lists’." Princeton eCom’s revenues come
from transaction fees and "overnight interest" on the payments.
1-800 PayBill allows Princeton eCom’s clients to accept payments by
telephone and is the forerunner of a new Internet bill publishing
service, which has not yet been given a brand name. For one utility,
consumers can check the amount of a bill on the telephone and pay
it or postpone it.
A third option: customers can choose to see a bill and pay it on the
utility’s website. Bell Atlantic Mobile and Lucent Technologies Consumer
Products are among those using this Internet bill publishing service.
Digital Scanline, a value-added service of all the products, will
digitize the payment list and validate the "postability" of
Princeton e-Com also operates a call center so that clients can outsource
customer service inquiries on Internet bill publishing and payment
When interviewed two years ago (U.S. 1, November 5, 1997), Licciardello
cited more than 250 customers and "electronic lockbox" connectivity
to more than 700 national bill senders.
A major competitor, Atlanta-based CheckFree, claims to be the leading
provider of electronic billing and payment processing and trades on
Nasdaq as CKFR. The difference: CheckFree is trying to do both front-end
and back-end business, through retail banks, whereas Princeton eCom
has stayed with the back end.
Two years ago Princeton eCom’s business seemed limited by the number
of retail customers who would take the trouble to set up online checking
accounts. Now that it seems possible for anyone with a credit card
and an Internet account to be able to pay their bills online, the
newly renamed firm can tap the growing E-commerce market.
— Barbara Fox
08540. Donald C. Licciardello, CEO. 609-924-1244; fax, 609-924-1096.
Home page: http://www.princetontele.com.
Two new office buildings at Carnegie Center may add
a new look to Route 1. The West Windsor planning board has scheduled
a meeting Tuesday, April 20, to review the final site plans of Carnegie
Center Associates for 901 Carnegie, a 140,000-square foot building
at Carnegie Center West (between Macaroni Grill and Carnegie Center
Boulevard) and 302 Carnegie, a 100,000-foot building on a triangular
lot south of Summit Bank. Both new buildings would front on Route
Sam Surtees, the township’s director of community development, says
the proposal for the east side has received approval for a stand-alone
sign for Merrill Lynch, which might occupy up to 60,000 feet of the
100,000-foot building. The nine-acre site for 901 Carnegie would be
developed by Hallbridge Real Estate Group, the just-formed partnership
of Hal Hoeland and Suzy Trowbridge, who are negotiating with several
Hoeland, a 1969 alumnus of Princeton University, is also president
of Princeton Development Group. His projects include the 25,000-foot
Woodlands Professional Building on Bunn Drive, finished in 1995, and
a new medical arts building now under construction on Princeton-Hightstown
Road. Trowbridge went to Boston College, Class of 1963, and has been
a reporter for the Chicago Tribune, a writer for Town Topics, and,
as a licensed real estate broker, a leasing agent for Forrestal Village
and Palmer Square.
Another Hallbridge project, a 17-acre site on Schalks Crossing Road
zoned for 200,000 square feet, will be developed for laboratory and/or
research and communications companies that need "turn-key"
access to the latest networking and communications technology.
08542. 609-924-3495; fax, 609-924-3496. E-mail: firstname.lastname@example.org
Village Financial Corporation is having another go at
attracting from $5 million to $12 million of seed capital to set up
a federally chartered savings bank. CEO Kenneth J. Stephon extended
the purchase deadline and scheduled an information session for potential
subscribers to the initial public offering of common stock at $10
a share. The reception will be Wednesday, April 14, at 7 p.m. at Mercer
Mutual Insurance, 10 Route 31 North, Pennington. Call 609-689-1010
The future bank’s failure to meet the deadline was not surprising
— other new banks have had that problem. What did seem surprising
was that a Business News New Jersey article reporting the bank’s shortfall
and speculating on the bank’s perception problems did not mention
the connection between George M. Taber (founder and president of the
New Brunswick-based newspaper) and Village Financial (Taber is on
the board of the future bank).
In a short article in the April 5 issue of Business News, a consultant
speculated on why the bank failed its minimum goal, suggesting that
because Stephon had been CEO of a bank in South Jersey he lacks visibility
in this area. Readers might have wondered whether the board was sending
a message to Stephon through the magazine.
No, says Diana Lassiter Drake, the managing editor: "We were just
reporting the story as we normally would, and we will continue to
report this story as it happens." Drake notes that Taber’s connection
to the bank was disclosed in previous stories; she plans to clarify
Reached by telephone, Stephon said that the board had considered the
visibility question, but he enumerated some other factors that had
not been accounted for. One was the timing. Says Stephon: "Many
people told me their investment plans were affected by needing to
wait for tax refunds."
Another was public reaction to the offering amount. Though the offering
was planned for up to $12 million, only $5 million in capital is actually
needed to begin. But as Stephon points out, if the offering had been
capped at, for instance, $7 million, and the interest far exceeded
that, the bank would have had to reject some investors or start all
over. "We didn’t want to be in that position," says Stephon.
The new bank’s federal thrift charter may also need explaining. "It
was initially designed and is still intended to promote home ownership
of individuals and families within the community. We think that is
a noble goal," says Stephon.
In contrast to mortgage companies, he says, banks can provide full
banking services. And with the recent change in thrift charters, thrifts
can make a large number of commercial loans. "We think the flexibility
of the charter gives us certain business advantages," says Stephon,
pointing out that Sovereign Bank, the 900-pound gorilla of the thrifts,
has the same charter as his bank.
Among the other thrift banks are Roma Federal Savings, Magyar, and
Stephon’s alma mater, Pennsauken-based Clover. "Everybody’s making
outstanding money," says Stephon.
Point, Suite A-22, Pennington 08534. 609-730-0183; fax, 609-737-0003.
Richard Plumeri has merged his Hamilton Square residential
real estate firm with Coldwell Banker, and it will be known as Coldwell
Banker Richardson Realtors (609-586-0400).
hockey and lacrosse coach at Princeton University. A service will
be Sunday, April 11, at 3 p.m. at the Unitarian Universalist Church.
Engineering on Lawrence Road.
Regional School District and Ellsworth Liquor Store.
he co-founded EchoCath Inc. on Route 1 North.
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This page is published by PrincetonInfo.com
— the web site for U.S. 1 Newspaper in Princeton, New Jersey.