With construction portals failing left, right and centre, it might seem like a bad time to launch an internet venture. But the big-league backers of Asite are convinced that they can defy economic gravity.
A is for ambition. The ambition of construction industry portal Asite is "to transform the underlying economics of the construction industry". If this sounds like hype in a climate where other contractor-backed portals are petering out, you just have to look at who is saying it.

Launched last October as a joint venture between Stanhope, Rotch Property Group and nine leading technology providers, including Microsoft and CommerceOne, the heavyweight line-up of industry players backing Asite keeps getting longer. It has just announced seven more major shareholders, including big hitters British Land, Tishman Speyer and Prudential. It has tapped into expertise from all disciplines in the industry to develop the portal, including construction manager Mace, cost consultants Turner & Townsend and Hanscomb and architect ORMS. And it has licensed the Building Information Warehouse, the thriving project collaboration service provider.

The portal to end all portals
With these building blocks in place, Asite aims to become the central information hub for the entire industry from architects to materials manufacturers and from trade contractors to facilities managers. "While existing software tools may be useful for project management, procurement, cost management and tendering, Asite will offer a suite of electronic products that enable you to integrate all these activities without printing anything off – the cost and times savings are amazing," says Ian Eggers, last year's construction manager of the year who was lured away from the Greater London Authority to be Asite's director of supply-chain management.

Inevitably, many are sceptical. Other portals, such as Arrideo, were launched amid similar fanfare, only to fail months later because of lack of industry interest and uneven commitment from shareholders. The outlook for e-commerce ventures is dire. Only two weeks ago, US collaboration portal Citadon laid off nearly half its workforce, and in February, researcher Jupiter MMXI predicted that four-fifths of online marketplaces in Europe would go bust. However, Jupiter MMXI placed two construction portals (BuildOnline and eu-supply.com) in its list of 10 sites most likely to survive, meaning that Asite will be up against stiff competition.

The status of Asite's major shareholders – blue-chip clients that spend more than £5bn on construction a year – augur well for its ability to drag an apathetic industry along with it. But big-name backers aren't always enough to guarantee security, as construction hub Aecventure found when Bovis Lend Lease withdrew its support in February, saying there was insufficient interest to justify developing it.

"The focus is on quality, not quantity," says Alistair Mellon, director of strategy and business development at Asite. "The industry tends to follow the leaders and the mass of trade contractors and suppliers will rapidly follow." But the real key to its success, Mellon points out, is more basic: "Asite is about mining information at industry level. It is about identifying economies of scale that are of interest to everyone in the supply chain. But people are time-poor, they find it hard to get involved unless there is economic self-interest. That is what drives involvement." Mellon expresses this economic self-interest in terms of hard cash. "Asite will facilitate procurement systems through mass buying. People currently procure from catalogues, open and closed, and the average invoice in the industry is £255.

"The average cost of processing the invoice that comes in by fax is £60. If trade contractors commit to using the collaborative tools Asite provides, they can share 90% savings on transactions with suppliers, and general contractors and owners benefit." A source at a rival portal is not convinced that the site can bring these disparate groups together: "The reason everyone is finding it so difficult is because it is such a broad market and the supply and buy sides are so fragmented. Having a few large clients does not ensure you will get any traction, you have to court the large suppliers, distributors, manufacturers."

Gathering intelligence
Still in pilot stage, Asite will go live in late summer, offering two collaborative tools, which it will load on to the Project Information Channel, an online project collaboration service run by the Building Information Warehouse. It will also offer direct material procurement through an online catalogue, tendering online, auctions and news feeds. Asite plans to gather information across the industry for the next four years, matching up suppliers and buyers who seem suited. It will also develop more collaborative and information-distribution software.

Logistics and insurance tools will follow by the end of this year. Expansion into the £540bn European construction market is planned, once the site is running smoothly in the UK.

In its first big information-gathering push, Asite is hosting a general contractors summit this month and a series of meetings with specialists in six key groups – envelopes, sub- and super-structures, mechanical, electrical, interiors and miscellaneous.

Those still sceptical that the fragmented, adversarial construction industry will be united in one huge knowledge-sharing virtual nirvana should note that trade contractors are already beating a path to Eggers' door. "The industry now is so hard to work in, any project that changes the market perception of the industry and makes it easier to join has to be good. This is backed by the industry – that is what makes it so seductive. It gets hold of Rethinking Construction by the throat," says Eggers. He is convinced that this is the portal that will finally deliver the goods: "Egan and Latham identified the issues but not the mechanisms to deliver the solutions. Asite will provide the mechanism."

How Asite plans to streamline the supply chain

Among other services, Asite will offer material purchasing, including bulk buying, to trade contractors and tendering for construction managers, main contractors and clients. So far, so standard portal. Asite aims to go one step further by tracking demand for products around the industry, allowing suppliers to co-ordinate deliveries. Alistair Mellon, director of strategy and business development, is keen to point out that the service will not supplant relationships between contractors and suppliers. “We are not trying to destroy relationships that contractors have built up over many years, but facilitate those relationships. The first step is to build the whole industry in. We encourage all members of the supply chain to enter into dialogue to identify which products, time and time again, are integrated into the guts of buildings. Then we find out who the suppliers they buy their materials from are and negotiate to load that information on to the online catalogue.”