Ok, we admit it - we develop software. Pretty high end though (with patents and the lot!) Our main customers are Government organizations wanting to create markets where in the past there weren’t any (think carbon) or where the market is not exactly a glowing example of great commercial outcomes. It works for heaps of commodities (grain, ores etc.) but (we tip our hats!) Governments bodies have been more innovative here than private companies.

Oh, we almost forgot - our software covers the whole process from making sure buyers are legitimate (bidder qualification), the event itself (we call them combinatorial auctions) and everything to do with the contracts afterwards.

Now, you may think of auctions as a way to wring every last penny out of buyers and suppliers. Now, that’s not what our combinatorial auctions are about.

combinatorial what?

Has anyone noticed that governments are starting to think and act a bit like businesses (even before the credit crisis)? As an example, Governments are discovering technology to get a better return on all the things they sell.

Take the sale of mobile phone frequencies (its called ‘spectrum’). Boring? Not really, if you know that it raises billions of dollars per year for the tax payer (you!) through auction technology. It worked well, so some smart people started saying, “what about all those other things the Government tries to sell - carbon permits, land , mining rights, timber, port slots, gambling rights... let’s auction the lot!”

Most of these commodities are pretty complex and have a lot of ifs and buts ... Normally good reasons why not to run an auction. Until those combinatorial auctions came along...

combinatorial what?

You have to give it to the guys who came up with combinatorial auctions, the idea is quite revolutionary. Combine the competitive pressure of an online auction with the flexibility of a negotiation. In other words, create good revenue and happy customers. Great idea. And it stayed just that, until the technology caught up and that’s where we come in.

Still lost? Try this five step recipe (proven in our kitchens):

• Gather pre-qualified buyers in a web portal
• Let them express exactly what they are after (in terms of price, volume, quality, payment terms, shipping modes, bundling of goods… no limit really)
• Let the system determine (in real time!) how you would allocate whatever you’re selling (the good, license, permit …)
• Play the result back to buyers.
• Let them improve their offer until they get exactly what they are after.

Then go back to (3.) and (4.), until every one has fine-tuned their offer and the deal is locked in.

Got it? Our smart markets find the optimal result through sheer market forces.

time for a real life example?

How do you turn an industry on its head? Do what the Victorian State Government did in 2005 and get rid of the good old tender box. We were selected in a global tender (correct, we are proud of this) to design and implement a timber sales platform.

So what? The platform deals with price and non-price factors (that’s the softer stuff like loyalty, quality, freight etc.) . The latter are translated into dollars and all of a sudden even your many years of loyalty can have a financial value!

More than that (and the geeks love this) , if there are mills asking for very different combinations of price, volume, species, grades, freight components and even bundles of products… you end up with literally millions of combinations. But which one combination is revenue optimal? You guessed it - our technology tells you. In real time. Why does that matter? Because buyers can respond and adjust their bids.

Words, words. But does it work? You bet. Initial revenue uplift of over 40%, 16% over the longer term (we sell 10 years forward!). And another surprise: Buyers would not want to buy their timber any other way.

We are obviously talking about carbon permits or allowances here. Ever heard of an Emissions Trading Scheme? Governments have a pretty big challenge at hand - to start a market for a new commodity is one thing. To get the carbon price right, not too low (as it wouldn’t trigger anything other than noise) and not too high (we want change, not chaos). Here is an idea if you don’t really know where the right price is: -let the market decide. That’s basically what carbon auctions do.

Australia has – since ratifying the Kyoto Protocol - taken big steps forward. We know this because we are fortunate enough to be the only technology provider on the Emissions Trading Advisory Panel of the Department of Climate Change.

And just by the by, we have a working carbon permit auction system with all the bells and whistles – we’re talking ascending clock, intra-round bidding, credit and volume limits, rationing, you name it. Happy to demo.

We also have some great software that helps you to determine when its worth it for you to bid and when its best to let the others battle it out. Ask us more.

What is Australia doing about carbon auctions?

The Australian Government has moved pretty quickly over the past 12 months to put the wheels in motion for Australia’s very own national carbon market.

Australia has decided to auction the carbon permits to companies – tradeslot has helped the Department of Climate Change (DCC) with the auction design. Watch this space - in late November 2008 a White Paper will confirm the details.

Having said that, companies need to find out whether they will have to buy permits in auctions… or not. Tradeslot can help out here as well – check out CarbonNavigator.

tradeslot ‘s role in carbon permit auctions

We should also let you know that while we have helped the Australian Government out with some of their questions around auction design, nothing we say on this website represents the Australian Government’s position. If you want to know more about the official Australian Government position, please contact them directly.

By now you should have figured out that we know a thing or two about auction design – and we have the technology to see it the ideas through as well. That’s probably what got us on the ETS advisory panel for the Department of Climate Change.

By helping the Australian Government design world-leading carbon permit auctions , tradeslot is now looking pretty for other governments thinking about carbon permit auctions.

our technology

We should also let you know that while we have helped the Australian Government out with some of their questions around auction design, nothing we say on this website represents the Australian Government’s position. If you want to know more about the official Australian Government position, please contact them directly.

You don’t want to get this wrong. In Australia they are estimating 6-9 billion dollars being raised through permit auctions per year. And there is quite a bit to consider…

Ascending Clock		Mechanism				Price Factors		Discounts
Proxy Bidding								Payment Terms
Bidder Feedback								Sector / Industry
								Geography
Spot		Time Horizons
Forward						Constraints		Volume
Multi-Vintage								Value
								Budget
Private(pre-qualified)		Bidders						Cross-vintage
Public								Geography
Standard vs. Powerusers								Market Share

Needless to say, our carbon permit auction platform can deal with all these factors. If you are a government interested in setting up your carbon market right – give us a call.

Smart markets (like the carbon market) mean that companies need smart decision support tools.

CarbonNavigator is exactly that for companies which will be reporting, running abatement projects, trading carbon permits...

A lot is to be said about CarbonNavigator - so it has its own website!

Click here and we’ll take you there.

CarbonNavigator is a web based platform allowing companies to do pretty much everything to comply with regulations, assess abatement options or plan for carbon permit auctions.

A lot is to be said about CarbonNavigator - so it has its own website!

Click here and we’ll take you there.

The last thing you want right now is additional cost. Hiring in carbon experts is one way, giving your existing team smart tools is an even better one!

CarbonNavigator is subscription based, requires no costly installation or implementation and is priced to make the decision easy. We even offer not-for-profit licenses.

A lot is to be said about CarbonNavigator - so it has its own website!

Click here and we’ll take you there.

tradeslot is a Melbourne, Australia based technology company. We combine our technical expertise with a powerful network of international thought leaders in strategy, market design and auction theory. tradeslot has been awarded a series of US and Australian patents and works across a variety of industries and geographies.

Key Executives:

	Jesco d’Alquen (CEO) Jesco d’Alquen is the CEO of tradeslot Pty Ltd. Jesco has over 13 years of experience in Executive in-house roles and consulting (Accenture, Deloitte, General Motors), delivering large scale strategy and technology projects in Europe, the US and Australia. Jesco has been the driving force behind tradeslot’s growth in the carbon space (e.g. CarbonNavigator.com) and the success story of establishing Private Electronic Markets in commodity trading from timber to grain and water. As a leader in allocation mechanisms and market simulation tradeslot has recently been appointed to assist the Department of Climate Change in the design and implementation of the Australian Emissions Trading Scheme. Jesco holds a Master of Business and Cultural Studies from the University of Passau (Germany) and a Master of Advanced European Studies from the University of Basel (Switzerland).
	Anthony Du Preez (CTO) Anthony Du Preez is the co-founder of tradeslot and has implemented over 200 multi-dimensional high value Private Electronic Markets with an aggregate value of over $1b. Anthony combines expertise in economic game theory, auction theory, market design, legal frameworks as well as mathematical allocation algorithms.
	Andrew Barlow (CHAIRMAN) Andrew Barlow is a Founder of one of Australia’s most successful technology companies, Hitwise (hitwise.com.au), which sold recently to UK listed Experian Group Limited for approximately $A300 million. As Chairman and Joint-Managing Director of Hitwise from 1997 to 2000, Andrew was responsible for all aspects of the business’s development. Now a global business Hitwise operates across 6 countries. Mr. Barlow is also a co-Founder of Oxia (oxia.com). Oxia is the world leader in personal bottled oxygen, selling canisters in the US and Canada through high-end boutique hotel chains and retail stores. Online super fund max Super (maxsuper.com.au), is a company he founded with his brother David, a former Merrill Lynch analyst, in 2005. max Super quickly became recognised for the youthful, helpful and innovative approach used to engage Australian’s in their super. Mr Barlow sees his professional role expanding into what he calls a ‘mentor capitalist’. Barlow expertise in raising capital and building innovative businesses has been well documented through the success of Hitwise, max Super and Oxia. He believes the typical structure and management style of venture capital within Australia is ripe for innovation.

tradeslot is growing. You can grow with us! As a niche player we are looking for specialists in market design and auction theory – preferably with practical experience gained in high end consulting or industry strategy roles.

To submit your interest please mail a brief outline of your expertise and career goals to: careers@tradeslot.com