Online Extra: Q&A with CEO Howard Lutnick

Says eSpeed's boss: Anything commodity-like will be sold online. The world is going to trade commodities like it trades stocks

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September 3, 2001 at 4:00 AM UTC

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While most online marketplaces are in a financial death spiral, eSpeed has been gaining altitude. The company has become the de facto exchange for U.S. Treasury securities, with about half of the $300 billion in daily trades taking place on its system. In the second quarter, eSpeed saw revenues of $34.1 million, up 52% from a year ago. To spur future growth, eSpeed has created online marketplaces for 46 other products, ranging from foreign exchange to electricity. The most promising: TradeSpark, an exchange for natural gas and electricity formed by eSpeed and five energy companies.

Although the company continues to lose money -- $1 million in the second quarter --executives and analysts expect it to turn profitable in the current quarter. Next year, eSpeed is forecasted to earn $24 million on $195 million in revenues, says J.P. Morgan Chase & Co. analyst Greg Smith. BusinessWeek's Spencer E. Ante sat down with eSpeed's CEO Howard W. Lutnick to talk about himself, the company he founded, and the challenges it faces. Here are edited excerpts of their conversation: