capSpire Creates a Full Service CTRM Company

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capSpire, founded in early 2009 and with clients in the US and Europe, has recently begun pursuing a growth strategy that leverages their deep domain knowledge around specific Commodity Trading and Risk Management solutions and coupling those skills with leading edge technical resources in order to create an organization that is capable of providing unique solutions to difficult business issues.

capSpire is blazing a bit of a different trail in this industry.

Service providers and system integrators are a vital part of the Commodity Trading and Risk Management (CTRM) landscape, providing unique skills or supplementing resources for companies that are working to improve their CTRM system capabilities. In fact, a recent CommodityPoint study, Consultants and Systems Integrators in Trading and Risk Management, notes that about 80% of the companies utilizing commercial CTRM systems have employed the services of one or more of these consulting organizations.

The companies that provide these services around CTRM software can be generally described as one of four types of providers:

1. Global well-known firms (including what is known as “The Big 4″) for which E/CTRM is but a component of their overall business
2. Relatively large firms that employ one hundred or more consultants and specialize in few markets, such as E/CTRM and Financials
3. Firms who service a local market only, employing a few dozen or less consultants and who specialize in a particular industry (in this case E/CTRM)
4. Boutique specialist firms, who employ few consultants, but have specific capabilities in some aspect of E/CTRM, such as risk management.

Additionally, not all of the larger Service Provider firms have capabilities (practices) around CTRM software in all geographies or locations, or they may focus in on particular aspects of Trading & Risk Management such as business consulting, strategy consulting or software selection.

capSpire, founded in early 2009 and with clients in the US and Europe, is blazing a bit of a different trail in this industry. While they had been essentially a boutique consulting firm, they have recently begun pursuing a growth strategy that leverages their deep domain knowledge around specific CTRM solutions, such as Solarc’s RightAngle product, and coupling those skills with leading edge technical resources in order to create an organization that is capable of providing unique solutions to difficult business issues. As Lance Laubach, capSpires CEO notes, “We’re always looking ways to improve our value proposition to our customers and differentiate ourselves from the competition. You can’t do that by merely providing an hour’s effort for an hour’s wage – you have to look for ways to utilize technology as a lever with which to create multiples of return for that hour’s effort.”

Having seen solid success with this model, the company has been filling their growing staffing need through the recruitment of highly experienced industry veterans and new university graduates that possess unique technical skills. The combination of resources enables capSpire to:

  • Deliver expert level consulting support for industry standard CTRM applications
  • Mentor and train new resources in the company’s methodologies
  • Create high value, blended teams capable of consulting around industry specific issues, yet also able to deliver leading edge technical solutions at a cost below the industry average.

As Jeff Hardcastle, capSpire co-founder puts it, “We invest considerable time and resources in the area of recruiting and employee development. We have a very strict discipline on the skillsets we recruit and have grown very effective at identifying those traits, especially in college hires. All of our new hires, including those from the universities, undergo a comprehensive three month program of education in our methodologies, the CTRM market as a whole, and our unique technical “toolbox” that we’ve developed around our CTRM practice that allows us to provide holistic “engineering quality” solutions that contrast stereotypical consulting methodologies.”

The “toolbox” that Mr. Hardcastle references is being leveraged as the company has also been purposefully evolving from a “pure” consulting business to one that is more of a full service CTRM company – that is an organization that provides both services and products that support, but are essentially agnostic, to the underlying CTRM product(s). capSpire has taken a few of the technical solutions within that “toolbox” and are evolving those into products that can create significant value and accelerate the delivery of solutions to complex business issues.

Their first such product offering, Gravitate, is a CTRM “portal” and is currently in use by wholesale petroleum marketers, providing a valued added service to their customers. This newly delivered product enables a marketer’s customers to access their information contained within the marketer’s CTRM system, such as prices, trade performance, and invoices. The system, via the use of its own data structures, is independent of the underlying CTRM software, yet has been designed to easily integrate with all leading products, providing a highly configurable platform for web-enabling those products.

According to Mike Scharf, the other capSpire co-founder, “We recognize traditional consulting is all about reinventing the wheel on each project. Our approach is recognition that for most clients, they don’t need a new wheel; they need a services partner who can quickly provide them with the solutions they need coupled with the reassurance of an “always available” partnership. The Gravitate CTRM Portal is just another example of our own innovation and investment in creating solutions that don’t require our clients to reinvent the wheel.”

capSpire has been able to create a bit of a unique animal in this market. Their deep domain knowledge and roster of talented people and specialized technical solutions has enabled them to grow quickly and has provided a solid base of referential customers. Their challenge will be in maintaining what for some has proven a difficult balance between growing rapidly and maintaining a consistently high quality of service on the consulting side. capSpire’s recruiting and training model, combined with their ability to leverage proprietary technical solutions would seem to position them well for meeting that challenge.

Patrick Reames
Managing Director, CommodityPoint
http://www.commodity-point.com/2012/01/creating-a-full-service-ctrm-company/

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Jeff Smith
capSpire
479.304.8070
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