Not only is eTime Capital gearing up to launch a brand-spanking-new real-time market information system for commercial asset-backed securities - yet another stab at networking the capital markets - but the company is actually looking to sell the revenue streams associated with their service into that same asset-backed commercial paper market.
Not for a bit of time, however, said Chief Financial Officer Sunil Mehta.
"Ultimately, down the road, our intent would be to be able to [issue] on our own, to take advantage of these efficiencies," said Mehta. "But we are a startup company at this time."
The eTime system, which will be implemented at the turn of the century, will attempt to provide very detailed information on the receivables sold as ABCP.
"We are taking advantage of the inefficiency currently in the information side of the receivables," Mehta explained. "There is a tremendous lack of information for financial institutions to effectively securitize receivables."
Currently, when a company pools receivables and sells them into a conduit, there is no valuable information on how an individual receivable is performing, he said. "Many times you don't even know if it's a true receivable, for example."
From eTime's point of view, there are essentially two value propositions built into their product. First, real-time information will allow the companies to analyze their own data, and make their operations more efficient.
"And the second piece is that we can enable smaller companies to get financing via the capital markets, which is a cheap form of financing," Mehta explained. "We want to enable the smaller companies that don't have the kinds of ratings that some of the very large companies do to have access to the capital markets."
eTime plans to service as many companies as possible, and over time, cover the entire ABCP market. "Since the information is useful whether it's the term or commercial paper market, it could easily be focused on the term market," he said. "It doesn't take a big step."
Though unwilling to name specific clients, Mehta said, "The companies we are talking to have revenues starting at $100 million dollars, and going up to $20 billion dollars. So we're talking to fairly large companies.
"We are seeing a lot of interest," he said.