Back in 1996, when Monica Morse first planted the idea of creating an Internet portal for farmers, she failed to reap any results. She was new at her job, and the Net was not yet the indispensable business resource that it would soon become. But while her bosses at Cargill passed on the idea, Morse refused to give up the chance to see the Web really grow. So, during what she calls the Internet's "Wild, Wild West years," she left to join a startup and later attempted to start her own e-fulfillment business.
Today, Morse is back at Cargill, serving as a managing director of the company's 20-member eVentures group. Like many businesspeople who have tried to brave the Internet frontier alone, she has learned that big, established companies have strategic advantages that dotcom homesteaders just can't match. "Before, I was working on the hype side of the Internet," says Morse, now 34. "What's appealing about our mission here is that we're doing something that's built to last — built to change, but also built to last."
Big companies like Cargill, meanwhile, have learned that the Net has the power to shift the boundaries of their business, and they have rushed to defend their turf. Cargill, the largest privately held company in the United States, has plenty of turf to defend. The Minneapolis-based agribusiness giant is the largest U.S. grain exporter, with operations that also include commodities trading, food processing, and steel making. Last year, its total revenues came to $48 billion.
A couple of years ago, leaders at Cargill realized that the Internet was undermining some of the company's traditional sources of advantage — in particular, early and proprietary access to global market information. In 1999, partly in response to that threat, they launched a "strategic intent" program, which seeks to balance radical change with a renewed focus on business fundamentals. The goal, says Morse, is to "help Cargill get back to its roots."
The eVentures group is one manifestation of that larger, company-wide reinvention. Morse and the rest of the eVentures team are charged with creating independent B2B ventures that capitalize on the company's expertise in a wide range of fields. She believes that Cargill has what it takes to move B2B from the realm of promise to the realm of profit. "Most B2B exchanges are vertical marketplaces, offering services like auctions and price discovery," she explains. "We're focusing on both vertical and horizontal expertise. That means tapping our understanding of agribusiness, but it also means leveraging what we know about logistics and bulk ocean transportation."
To be sure, even for big companies, this isn't a great time to bet the farm on the Internet. While B2B ventures haven't been hit as hard as consumer-oriented dotcoms, they're still struggling to attract customers. Companies have been slow to trade on B2B exchanges, either because of infrastructure problems or because of worries about transaction security. And some exchanges are simply falling victim to a skittish investment environment. ShipDesk, for example, a once-promising online shipping exchange, failed to leave port after its main funders withdrew support.
But Cargill is wagering on a consortium model that it hopes will give its ventures credibility, staying power, and vitally important intellectual capital. After witnessing some of its early Web initiatives fail to build momentum, the company dropped its long-standing resistance to forming partnerships and began forging alliances with big-league outfits like DuPont and British Petroleum. "Providing real collaboration and value-added services is harder than offering simple online auctions," says Morse. "That's why we've looked for partners that have both the vision to create a profitable enterprise and the ability to get some traction quickly."
Perhaps the most high-profile "eVenture" is Rooster.com, a version of the farm-portal idea that Morse proposed back in 1996. Launched last May, Rooster is an online marketplace where producers can sell their crops and where they will eventually be able to buy seed, fertilizer, and other supplies. Initial investors included DuPont and Cenex Harvest States Cooperatives, as well as Cargill. But while Morse's team took the lead in creating Rooster, the site operates independently of Cargill, and competing agricultural suppliers take part in the exchange as well. Also, unlike some B2B efforts, the site does not focus on disintermediation — on cutting out supply-chain "middlemen." Says Morse: "If you take a look at rural America, there just aren't a lot of people out there, and the roles that they play are all critically important. We're trying to enlist all parts of the value chain, so that everybody wins."
For Morse, winning the B2B game is less about smart technology than about smart management — about reconciling small-scale efficiency with large-scale resources, and control with cooperation. "On a practical level — in terms of team building, technology development, and setting up companies that have their own vision and their own goals — we execute like a startup," she says. "At the same time, we keep a tight organizational structure." All in all, Morse says that she's glad to be back in the big-company fold: "With a business like Cargill, even a small change can have a big impact."
Cathy Olofson (email@example.com) is a writer and editor based in Belmont, Massachusetts. Visit Cargill eVentures on the Web (www.cargilleventures.com).
A version of this article appeared in the May 2001 issue of Fast Company magazine.