SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q

(Mark One)
|X|  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

For the quarterly period ended September 30, 2000

                                       OR

|_|  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

     For the transition period from____________________to__________________

                          Commission File No. 000-27803


                               SCIQUEST.COM, INC.
             (Exact Name of Registrant as Specified in Its Charter)

       Delaware                                                 56-2127592
 (State or Other Jurisdiction                                (I.R.S. Employer
of Incorporation or Organization)                           Identification No.)

  5151 McCrimmon Parkway, Suite 208                                27560
     Morrisville, North Carolina                                 (Zip Code)
(Address of Principal Executive Offices)


                                 (919) 659-2100
              (Registrant's telephone number, including area code)

                              ---------------------

     Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes |X| No |_|

     As of November 13, 2000, 29,090,633 shares of Common Stock, $.001 par
value, were outstanding.


<PAGE>



                               SCIQUEST.COM, INC.

                                TABLE OF CONTENTS


<TABLE>
<S>                                                                                                            <C>
PART I -- FINANCIAL INFORMATION:

ITEM 1: FINANCIAL STATEMENTS
     Consolidated Balance Sheets at September 30, 2000 (unaudited) and December 31, 1999......................    3

     Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2000
           and 1999 (unaudited)...............................................................................    4

     Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2000 and 1999
        (unaudited)...........................................................................................    5

     Notes to Consolidated Financial Statements...............................................................    6

ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS...............................................................................   14

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK............................................   35

PART II-- OTHER INFORMATION:

ITEM 1: LEGAL PROCEEDINGS.....................................................................................   36

ITEM 2: CHANGES IN SECURITIES.................................................................................   36

ITEM 3: DEFAULTS IN SECURITIES................................................................................   36

ITEM 4: SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS.....................................................   36

ITEM 5: OTHER INFORMATION.....................................................................................   36

ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K......................................................................   37

SIGNATURES....................................................................................................   39

</TABLE>

                                       2

<PAGE>

                                     PART I

Item 1.   Financial Statements

                               SciQuest.com, Inc.

                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                     September 30,   December 31,
                                                                                         2000            1999
                                                                                         ----            ----
                                                                                      (unaudited)
<S>                                                                                 <C>               <C>
                                      Assets
Current assets:
   Cash and cash equivalents......................................................       $24,092,641    $98,126,414
   Short-term investments.........................................................        44,137,421     24,285,293
   Accounts receivable, net.......................................................        15,723,695      1,771,634
   Prepaid expenses and other current assets......................................         4,474,858      1,625,355
                                                                                        ------------   ------------
     Total current assets.........................................................        88,428,615    125,808,696
                                                                                        ------------   ------------
Long-term investments.............................................................        21,863,130     23,592,483
Property and equipment, net.......................................................         9,323,750      2,869,423
Capitalized software and web site development costs, net..........................         8,922,742      1,392,085
Goodwill and other long-term assets, net..........................................       107,152,251      3,238,997
                                                                                        ------------   ------------
     Total assets.................................................................      $235,690,488   $156,901,684
                                                                                        ============   ============

                       Liabilities and Stockholders' Equity
Current liabilities:
   Accounts payable...............................................................       $11,709,505    $ 4,250,978
   Accrued liabilities............................................................         5,709,014      1,066,120
   Other current liabilities......................................................         1,948,570        508,416
                                                                                           ---------        -------
     Total current liabilities....................................................        19,367,089      5,825,514
                                                                                          ----------      ---------
Deferred income taxes.............................................................                --         66,225
Capital lease obligations, less current maturities................................         1,899,569      1,190,786
Commitments and contingencies.....................................................                --             --
Stockholders' equity:
   Common stock, $0.001 par value; 90,000,000 shares authorized; 29,048,963 and
     26,353,652 shares issued and outstanding as of September 30, 2000 and
     December 31, 1999, respectively..............................................            29,049         26,354
   Additional paid-in capital.....................................................       348,310,523    591,841,571
   Deferred employee compensation.................................................        (9,005,645)   (12,276,151)
   Deferred customer acquisition costs, net.......................................       (24,361,135)  (391,138,705)
   Other comprehensive income.....................................................             7,788             --
   Accumulated deficit............................................................      (100,556,750)   (38,633,910)
                                                                                        ------------    -----------
   Total stockholders' equity.....................................................       214,423,830    149,819,159
                                                                                         -----------    -----------
     Total liabilities and stockholders' equity...................................      $235,690,488   $156,901,684
                                                                                        ============   ============
</TABLE>

   The accompanying notes are an integral part of these financial statements.


                                       3
<PAGE>



                               SciQuest.com, Inc.

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)
<TABLE>
<CAPTION>
                                                              Three Months Ended             Nine Months Ended
                                                                 September 30,                 September 30,
                                                         ----------------------------   ----------------------------
                                                                2000             1999          2000          1999
                                                            ------------      ---------    ------------   -----------
<S>                                                       <C>                 <C>          <C>            <C>
Revenues:
   E-Commerce revenues................................      $ 17,885,048      $ 358,527    $ 34,239,122   $ 1,243,787
   Software license, implementation and maintenance
    revenues..........................................         1,805,530             --       3,379,027            --
                                                               ---------      ---------    ------------    ----------
     Total revenues...................................        19,690,578        358,527      37,618,149     1,243,787
                                                            ------------      ---------    ------------    ----------
Cost of revenues:
   Cost of e-commerce revenues........................        17,539,096        337,028      33,121,236       823,236
   Cost of software license, implementation and main-
    tenance revenues (includes $500,000, $0,
    $1,048,387 and $0, respectively, of amortization of
    capitalized software costs).......................         1,181,780             --       2,298,672            --
                                                             -----------      ---------     -----------     ---------
     Total cost of revenues...........................        18,720,876        337,028      35,419,908       823,236
                                                            ------------      ---------     -----------     ---------
     Gross profit.....................................           969,702         21,499       2,198,241       420,551
                                                            ------------      ---------     -----------      --------
Operating expenses:
   Development (excludes $131,197, $22,945, $873,056
     and $24,157,respectively, of stock-based employee
     compensation)....................................         3,423,514      3,116,154      10,822,382     6,298,444
   Sales and marketing (excludes $213,866, $52,960,
     $821,095 and $55,758, respectively, of stock-based
     employee compensation)...........................         8,949,297      3,020,431      20,339,514     6,185,710
   General and administrative (excludes $624,303
     $23,565, $2,493,838 and $24,810, respectively, of
     stock-based employee compensation)...............         5,979,319      1,638,504      14,862,551     3,763,395
   Stock-based employee compensation..................           969,366         99,470       4,187,989       104,725
   Stock-based customer acquisition costs, net........          (989,254)            --      (2,555,417)           --
   Purchased in-process research and develop-
     ment.............................................                --             --         700,000            --
   Amortization of goodwill...........................        10,152,548         64,867      21,597,688       128,246
                                                            ------------      ---------     -----------      --------
      Total operating expenses.........................       28,484,790      7,939,426      69,954,707    16,480,520
                                                            ------------      ---------     -----------      --------
Operating loss........................................       (27,515,088)    (7,917,927)    (67,756,466)  (16,059,969)
Interest income, net..................................         1,717,191        452,825       5,767,401       755,261
                                                            ------------      ---------     -----------      --------
Loss before income taxes..............................       (25,797,897)    (7,465,102)    (61,989,065)  (15,304,708)
Income tax benefit....................................                --         54,696          66,225       164,086
                                                            ------------    -----------    ------------  ------------
Net loss..............................................      $(25,797,897)   $(7,410,406)   $(61,922,840) $(15,140,622)
                                                            ------------    -----------    ------------  ------------

Net loss per common share--basic and diluted...........         $   (.89)      $  (2.04)      $   (2.20)     $  (4.31)
                                                            ------------    ------------   ------------- -------------
Weighted average common shares outstanding--
       basic and diluted..............................        28,959,928      3,637,769      28,063,927     3,511,340
                                                           =============   ============   =============  ============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                       4

<PAGE>

                               SciQuest.com, Inc.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                                Nine Months Ended September 30,
                                                                                -------------------------------
                                                                                      2000            1999
                                                                                ---------------   --------------
<S>                                                                             <C>               <C>
Cash flows from operating activities
   Net loss  ..................................................................     $(61,922,840)  $ (15,140,622)
   Adjustments to reconcile net loss to net cash used in operating activities:
     Depreciation and amortization.............................................       26,282,393         803,223
     Bad debt expense..........................................................          185,514              --
     Purchased in-process research and development.............................          700,000              --
     Deferred tax benefit......................................................          (66,225)       (164,086)
     Amortization of deferred compensation.....................................        4,187,989         104,725
     Amortization of deferred customer acquisition costs.......................       (2,555,417)             --
     Amortization of discount on investments...................................        (399,640)              --
     Realized loss on sale of investments......................................               --           1,447
     Changes in operating assets and liabilities:
        Accounts receivable....................................................      (18,967,327)       (189,740)
        Prepaid expenses and other assets......................................         (895,359)       (956,847)
        Accounts payable.......................................................        9,070,053       1,287,572
        Accrued liabilities....................................................          681,330       1,338,184
                                                                                    ------------    ------------
          Net cash used in operating activities................................      (43,699,529)    (12,916,144)
                                                                                    -----------     ------------
Cash flows from investing activities
   Purchase of property and equipment..........................................      (10,788,331)     (1,356,166)
   Cash received from acquisitions.............................................          529,865           4,916
    Proceeds from sale of equipment............................................               --         704,522
   Cash paid for acquisitions..................................................       (2,935,268)             --
   Maturity of investments.....................................................       35,966,315       5,473,205
   Purchase of investments, including restricted cash..........................      (53,689,447)    (28,515,911)
                                                                                    ------------    ------------
     Net cash used in investing activities.....................................      (30,916,866)    (23,689,434)
                                                                                    ------------    ------------
Cash flows from financing activities
   Repayment of notes payable..................................................               --         (79,188)
   Repayment of capital lease obligations......................................         (685,249)        (13,253)
   Proceeds from exercise of common stock warrants.............................          655,486          75,000
   Proceeds from sale of restricted common stock...............................          339,750              --
   Proceeds from exercise of common stock options..............................          272,635          32,022
   Proceeds from issuance of Series C convertible preferred stock, net.........               --         250,000
   Proceeds from issuance of Series D mandatorily redeemable convertible
     preferred stock, net......................................................               --      35,860,975
                                                                                     -----------    ------------
     Net cash provided by financing activities.................................          582,622      36,125,556
                                                                                     -----------    ------------
Net decrease in cash and cash equivalents......................................      (74,033,773)       (480,022)
Cash and cash equivalents at beginning of period...............................       98,126,414       5,391,462
                                                                                    ------------    ------------
Cash and cash equivalents at end of period.....................................     $ 24,092,641      $4,911,440
                                                                                    ============    ============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                       5
<PAGE>

                               SciQuest.com, Inc.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   The Company

     SciQuest.com, Inc. ("SciQuest.com" or the "Company"), which began
operations in 1995, is a web-based, interactive marketplace for scientific and
laboratory products used by pharmaceutical, clinical, biotechnology, chemical,
industrial and educational organizations worldwide. The Company earns revenues
from e-commerce transactions generated by purchases made through the
SciQuest.com Web sites. In addition, SciQuest.com earns revenue for banner
advertising on its web sites and advertising in the printed catalogue of
scientific products (the "Source Book"), which is prepared and distributed by
the Company's subsidiary, BioSupplyNet, Inc. ("BioSupplyNet") and on commissions
received for the auction of used scientific equipment by the Company's
subsidiary, Internet Auctioneers International, Inc. The Company also recognizes
revenues from its recently acquired subsidiary, EMAX Solutions Partners, Inc.,
which provides customized electronic research solutions designed to integrate
chemical information systems to improve productivity and compliance for
pharmaceutical, scientific and research companies.

2.   Summary of Significant Accounting Policies

Unaudited Interim Financial Information

     The unaudited interim consolidated financial statements as of and for the
three and nine months ended September 30, 2000 and 1999 have been prepared by
the Company pursuant to the rules and regulations of the Securities and Exchange
Commission (the "SEC") for interim financial reporting. These consolidated
financial statements are unaudited and, in the opinion of management, include
all adjustments necessary to present fairly the consolidated balance sheets,
statements of operations, and statements of cash flows for the periods presented
in accordance with generally accepted accounting principles. The consolidated
balance sheet at December 31, 1999 has been derived from the audited
consolidated financial statements at that date. Certain information and footnote
disclosures have been omitted in accordance with the rules and regulations of
the SEC. These interim consolidated financial statements should be read in
conjunction with the consolidated financial statements and notes thereto for the
year ended December 31, 1999 included in the Company's Form 10-K, filed with the
SEC on March 30, 2000. The results of operations for the three and nine months
ended September 30, 2000 are not necessarily indicative of the results that may
be expected for the year ending December 31, 2000.

Use of Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Principles of Consolidation

      The consolidated financial statements include the accounts of
SciQuest.com, Inc. and its wholly-owned subsidiaries, BioSupplyNet, Inc.,
Internal Auctioneers International, Inc., Intralogix, Inc., SciCentral Inc. and
EMAX Solutions Partners, Inc. All significant intercompany accounts and
transactions have been eliminated.

                                       6
<PAGE>

Cash and Cash Equivalents

     The Company considers all highly liquid investments with a maturity of
three months or less at the date of purchase to be cash equivalents.

Investments

     The Company considers all investments that are not considered cash
equivalents and with a maturity of less than one year from the balance sheet
date to be short-term investments. The Company considers all investments with a
maturity of greater than one year to be long-term investments. All investments
are considered as held-to-maturity and are carried at amortized cost, as the
Company has both the positive intent and ability to hold them to maturity.
Interest income includes interest, amortization of investment purchases premiums
and discounts, and realized gains and losses on sales of securities. Realized
gains and losses on sales of investment securities are determined based on the
specific identification method.

Property and Equipment

     Property and equipment is primarily comprised of furniture and computer
equipment that are recorded at cost and depreciated using the straight-line
method over their estimated useful lives which range from three to five years.
Property and equipment includes certain equipment under capital leases. These
items are depreciated over the shorter of the lease period or the estimated
useful life of the equipment.

Development Costs

     Development costs include expenses incurred by the Company to develop,
enhance, manage, monitor and operate the Company's web sites and costs of
managing and integrating data on the Company's web sites. In March 1998, the
Accounting Standards Executive Committee of the American Institute of Certified
Public Accountants ("AICPA") issued Statements of Position No. 98-1 "Accounting
for the Costs of Computer Software Developed or Obtained for Internal Use,"
("SOP No. 98-1") which provides guidance regarding when software developed or
obtained for internal use should be capitalized. SOP No. 98-1 is effective for
financial standards for fiscal years beginning after December 15, 1998. The
Company adopted SOP No. 98-1 effective January 1, 1999. With the adoption of SOP
No. 98-1, the Company began accounting for the software development component of
web site development costs in accordance with SOP No. 98-1 which requires
certain costs associated with the development of the Company's web sites to be
capitalized and amortized to development expense over the useful life of the
related applications, which generally range from three months to one year.

Capitalized Software Costs

     Software development costs are required to be capitalized beginning when a
product's technological feasibility has been established and ending when a
product is available for general release to customers. Capitalized software
costs result from the acquisitions of EMAX and BioSupplyNet (see Note 3) and
were determined by valuations prepared by management.

     The capitalized software costs resulting from the acquisition of
BioSupplyNet are primarily associated with a search engine with e-commerce
capabilities and high level electronic taxonomy and ontological conventions
under development by BioSupplyNet at the date of acquisition. These costs are
being amortized over a period of 27 months. Capitalized software costs resulting
from the acquisition of EMAX are primarily associated with customized electronic
research systems being sold by EMAX at the date of the acquisition. These costs
are being amortized to cost of sales over a period of 36 months.


                                       7
<PAGE>

Intangible Assets

     Intangible assets, which resulted primarily from the acquisitions of
BioSupplyNet and EMAX, were determined by valuations prepared by management.

     Intangible assets recognized from the acquisition of BioSupplyNet are
primarily associated with the Source Book and contracts with certain web sites
(the "Web Site Agreements") to provide a link to the SciQuest.com Web site.
Because the Source Book is a printed publication, which must be updated on an
annual basis, capitalized costs related to the Source Book were amortized over a
period of 15 months which began in September 1998 and ended in December 1999.
Capitalized costs related to the Web Site Agreements were amortized over a 12
month period which began in October 1998 and ended in September 1999.

     Intangible assets recognized from the acquisition of EMAX are primarily
associated with a registered trademark that is being amortized over a period of
three years.

     Goodwill represents the excess of the purchase price of BioSupplyNet, IAI,
SciCentral, Intralogix and EMAX over the fair value of the assets acquired.
Goodwill is being amortized over a period of three to five years.

Purchased In-Process Research and Development

     The acquisition cost of in-process technology that at the date of purchase
has not achieved technological feasibility and has no alternative future use is
charged to operations in the period such technology is acquired. Purchased
in-process research and development costs for the nine months ended September
30, 2000 relate to the acquisition of EMAX (see Note 3) and was determined by a
valuation prepared by management.

Fair Value of Financial Instruments

     The carrying value of cash and cash equivalents, accounts payable and
accounts receivable at September 30, 2000 and at December 31, 1999 approximated
their fair value due to the short-term nature of these items. The Company
considers its short-term and long-term investments to be held-to-maturity and
therefore these investments are carried at amortized cost.

Revenue Recognition

     Beginning in April 1999, the Company began earning almost all of its
revenues from the sale of scientific products through its e-commerce web sites.
In addition, beginning in June 2000, the Company began selling scientific
equipment. Prior to April 1999, the Company's revenues were primarily derived
from banner advertising on its web sites. With the acquisition of EMAX in March
2000, the Company began deriving revenues from custom software development and
implementation services, from sales of software licenses, and from support and
maintenance contracts.

     Revenues received from the sale of scientific products in e-commerce
transactions and from the sale of scientific equipment are recorded as product
revenues on a gross basis and are recognized by the Company upon delivery to the
customer. A reserve for returns is recognized for estimated product returns.

     Banner advertising revenues are recognized ratably over the period in which
the advertisement is displayed, provided that the Company has no significant
remaining obligations to the advertiser and that collection of the resulting
receivable is probable. Revenues from advertising included in the Source Book
are recognized at the date the Source Book is published and distributed to the
purchasers of scientific products as the Company has met all of its obligations
to the advertisers at that date.

     Revenues received from the auction of used scientific products by the
Company's subsidiary, IAI, represents commissions which are determined based on
a percentage of the value of the scientific products sold. The Company

                                       8
<PAGE>

recognizes these commissions in revenue at the date the related piece of
scientific equipment is accepted by the buyer.

     With the acquisition of EMAX in March 2000, revenues from the sale of
software licenses and custom development and implementation services under
fixed-fee contracts are recognized using the percentage-of-completion method
over the term of the development and implementation services. Revenues from time
and materials contracts are recognized concurrently with the effort and material
costs incurred by the Company, at billable rates specified in the terms of the
contract. Hardware sales revenue is recognized upon delivery to the customer.
Losses expected to be incurred on custom development and implementation services
contracts in process, for which the fee is fixed, are charged to income in the
period it is estimated that such losses will occur. The Company sells
maintenance contracts to provide updates and standard enhancements to its
software products. Maintenance fee revenue is recognized ratably over the term
of the arrangements, generally one year.

Cost of Revenues

     Cost of product revenues represents the purchase price to the Company of
the scientific products sold through its e-commerce web sites and of scientific
equipment, shipping and handling fees and the cost of maintaining such web
sites. The Company generally takes legal title to the scientific products and
equipment purchased at the date of shipment and relinquishes title to its
customers upon delivery.

     In addition, the Company bears all credit risk for its sales of scientific
products to its customers.

     The cost of software licensing, implementation and maintenance revenues
consists primarily of personnel costs for employees who work directly on the
development and implementation of customized electronic research solutions and
who provide maintenance to customers, and also consists of the amortization of
capitalized software development costs. Cost of advertising and subscription
revenue includes the cost of preparing the banner ads for display on the
Company's Web sites and the cost of publishing and distributing the Source Book.
Advertising production costs are recorded as cost of revenues the first time an
advertisement appears on the Company's Web sites.

Deferred Customer Acquisition Costs

     Deferred customer acquisition costs relate to common stock warrants given
to several key suppliers and buyers of scientific products. The amount of
deferred customer acquisition costs is and will be adjusted in each reporting
period based on changes in the fair value of the warrants until such date as the
warrants are fully vested. Deferred customer acquisition costs will be amortized
to operating expense over the term of the related contractual relationship using
a cumulative catch-up method. The terms of the contractual relationships range
from three to five years. Deferred customer acquisition costs are presented net
of accumulated amortization (see Note 5).

Stock Based Compensation

     The Company accounts for non-cash stock based compensation in accordance
with the provisions of Accounting Principles Board Opinion No. 25, "Accounting
for Stock Issued to Employees" ("APB No. 25") which states that no compensation
expense is recognized for stock options or other stock-based awards to employees
that are granted with an exercise price equal to or above the estimated fair
value per share of the Company's common stock on the grant date. In the event
that stock options are granted with an exercise price below the estimated fair
market value of the Company's common stock at the grant date, the difference
between the fair market value of the Company's common stock and the exercise
price of the stock option is recorded as deferred compensation. Deferred
compensation is amortized to stock-based employee compensation expense over the
vesting period of the related stock option.

                                       9
<PAGE>

     The Company has adopted the disclosure requirements of Statement of
Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" ("SFAS No. 123"), which requires compensation expense to be
disclosed based on the fair value of the options granted at the date of the
grant.

Credit Risk, Significant Customers and Concentrations

     Financial instruments that potentially subject the Company to a
concentration of credit risk consist of cash and cash equivalents, accounts
receivable and investments. Cash and cash equivalents are deposited with high
credit quality financial institutions which invest primarily in U.S. Government
securities, highly rated commercial paper and certificates of deposit guaranteed
by banks which are members of the Federal Depository Insurance Company. The
counterparties to the agreements relating to the Company's investments consist
primarily of the U.S. Government and various major corporations with high credit
standings. All of the Company's revenues are from sales transactions originating
in the United States.

     The Company relies on a number of third party suppliers for various
services, including e-commerce fulfillment services. While the Company believes
it could obtain these services from other qualified suppliers on similar terms
and conditions, a disruption in supply of these services by the current
suppliers could materially harm the business.

Segment Reporting

     As a result of the acquisition of EMAX (see Note 3), the Company has
determined that it has separately reportable operating segments, as defined by
Statement of Financial Accounting Standards No. 131, "Disclosures about Segments
of an Enterprise and Related Information" ("SFAS No. 131"). SFAS No. 131 will
require the Company to disclose certain financial information about operating
segments, of which the Company has preliminarily identified two. As SFAS No. 131
does not require adoption in interim financial statements in the initial year of
its application, the Company will adopt the provisions of SFAS No. 131 in its
annual filing on Form 10-K for the year ended December 31, 2000.

Net Income (Loss) Per Common Share

     Basic net income (loss) per common share ("Basic EPS") is computed by
dividing net income (loss) available to common stockholders by the weighted
average number of common shares outstanding. Diluted net income (loss) per
common share ("Diluted EPS") is computed by dividing net income (loss) available
to common stockholders by the weighted average number of common shares and
dilutive potential common share equivalents then outstanding. Potential common
shares consist of shares issuable upon the exercise of stock options and
warrants and shares issuable upon conversion of Class B common stock and
convertible preferred stock. The calculation of the net loss per share available
to common stockholders for the three and nine-month periods ended September 30,
2000 and 1999 does not include 5,805,000 and 7,293,000, respectively, of
potential shares of common stock equivalents, as their impact would be
anti-dilutive.

Reclassifications

     Certain prior period amounts have been reclassified to conform to the
current period presentation.

Recent Accounting Pronouncements

     In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements" ("SAB
101"), which addresses certain criteria for revenue recognition. SAB 101 is
required to be adopted for reporting periods no later than the fourth fiscal
quarter of the


                                       10

<PAGE>

fiscal year beginning after December 15, 1999. The adoption of SAB 101 is not
expected to have a material impact on the Company's consolidated financial
position or results of operations.

3.   Acquisitions

   Internet Auctioneers International

     On July 30, 1999, the Company purchased all of the outstanding common stock
of Internet Auctioneers International, Inc. ("IAI") in exchange for the issuance
of 114,995 shares of the Company's Series E convertible preferred stock. In
connection with the purchase of IAI, a former shareholder and officer of IAI
entered into a two year employment agreement with the Company. In the event that
this individual voluntarily terminates his employment prior to the end of the
two year period, this individual would be required to pay an amount equal to
$400,000, reduced by $50,000 upon completion of each 90 day period of continuous
employment, payable either in cash or by surrendering a number of Series E
preferred shares of an equivalent value, as determined in the individual's
employment agreement. The Company also entered into a three year non-compete
agreement with this individual.

     The purchase price of $1,416,000 consisted of the 114,995 shares of the
Company's Series E preferred, with an estimated fair value of $11.32 per share,
based on the per share price of the Company's Series D preferred that was sold
in May and September 1999, and the assumption of $160,000 of net liabilities of
IAI. The excess of the purchase price over the fair value of assets acquired
less liabilities assumed was allocated to goodwill. Of the total purchase price,
$22,000 was allocated to the tangible assets of IAI, which were comprised of
cash and accounts receivable. In addition, $400,000 was allocated to the
employment agreement with the former shareholder and recorded as deferred
compensation to be amortized to stock-based employee compensation expense over a
period of three years, and $994,000 was allocated to goodwill. Goodwill related
to this acquisition is being amortized over a period of five years.

   Intralogix

     On January 14, 2000, the Company purchased all of the outstanding stock of
Intralogix, Inc. ("Intralogix") in exchange for the issuance of 26,930 shares of
the Company's common stock with a value of approximately $1,828,000 at the
closing date of the acquisition, cash payments in the amount of $295,000
(including $61,000 for acquisition-related expenses) and the assumption of
$71,500 in net liabilities of Intralogix. This acquisition was accounted for
using the purchase method of accounting.

     Of the total purchase price of Intralogix, $600,000 was allocated to the
Web site developed and operated by Intralogix and approximately $1,589,000 was
allocated to goodwill, which represents the excess of the purchase price over
the fair value of assets acquired less liabilities assumed. Goodwill related to
this acquisition is being amortized over a period of three years. An immaterial
amount of purchase price was allocated to the tangible assets of Intralogix.

   SciCentral

     On February 2, 2000, the Company purchased all of the outstanding stock of
SciCentral, Inc. ("SciCentral") in exchange for the issuance of 40,000 shares of
the Company's common stock with a value of $2,534,000 at the closing date of the
acquisition, cash payments of $112,000 for acquisition-related expenses and the
assumption of approximately $15,000 in net liabilities of SciCentral. This
acquisition was accounted for using the purchase method of accounting.


                                       11
<PAGE>

     Of the total purchase price of SciCentral, approximately $2,372,000 was
allocated to goodwill, which represents the excess of purchase price over the
fair value of the assets acquired less the liabilities assumed. Goodwill related
to this acquisition is being amortized over a period of three years. In
connection with the purchase of SciCentral, a former shareholder and employee of
SciCentral entered into a two-year employment agreement with the Company. In the
event that this individual voluntarily terminates his employment prior to the
end of the two year period, this individual would be required to pay to the
Company an amount equal to $286,000, reduced by approximately $36,000 upon
completion of each 90 day period of continuous employment. The Company also
entered into a three-year non-compete agreement with this individual. The
$286,000 has been recorded as deferred compensation and is being amortized to
stock-based compensation expense over a period of two years. An immaterial
amount of purchase price was allocated to the tangible assets of SciCentral.

   EMAX

     On March 22, 2000, the Company purchased all of the outstanding common and
preferred stock of EMAX Solutions Partners, Inc. ("EMAX") in exchange for the
issuance of 1,625,680 shares of the Company's common stock with a total fair
value of $99,451,000, which is based on the average closing price of the common
stock of $61.175 for the two-day period immediately preceding and following the
date of the announcement of the acquisition of EMAX. In addition, the Company
assumed approximately $3,539,000 in net liabilities and incurred costs of
approximately $2,609,000 related to this acquisition. The Company also assumed
EMAX's obligations under its qualified employee incentive stock option plan for
EMAX employees. As a result of this, 374,152 shares of common stock have been
reserved by the Company as replacement options with an average exercise price of
$15.73 per share. The fair value of these options, which was estimated to be
$20,392,000 using the Black-Scholes option pricing model, is included as a
component of the total purchase price related to this acquisition. The
acquisition has been accounted for using the purchase method of accounting and,
accordingly, the total purchase price of approximately $126,000,000 was
allocated to the assets acquired and liabilities assumed based on estimated fair
values. The fair value assigned to intangible assets acquired was based on a
valuation prepared by management of the Company.

     Of the total purchase price, $2,398,000 was allocated to the tangible
assets of EMAX, which were comprised of cash, accounts receivable, property and
equipment and prepaid and other assets. In addition, $6,000,000 was allocated to
developed software costs, $22,000,000 was allocated to the EMAX registered
trademark and $700,000 was allocated to purchased in-process research and
development ("IPR&D"). The remaining purchase price of approximately $94,892,000
has been allocated to goodwill. The trademark, goodwill and developed software
costs are all being amortized over a period of three years. Additional purchase
price revisions may result from post-closing adjustments.

     The $700,000 of IPR&D was based on a valuation prepared by management and
relates to software development projects that had not yet reached technological
feasibility and had no alternative future use at the date of the acquisition of
EMAX. The Company intends to use this software in the development of the
e-commerce and scientific products search capabilities on the Company's web
sites. At the date of the acquisition, these software products being developed
by EMAX were approximately 15% complete. The Company estimated at the
acquisition date that it would incur a total of approximately $3.0 million to
complete the development of these software products and that the development
would be completed by December 2000. As of September 30, 2000 approximately $1.9
million of software development costs have been incurred related to these two
software products.

     In addition, the Company granted to EMAX employees a total of 113,980
SciQuest.com stock options, pursuant to the SciQuest.com 1999 Stock Incentive
Plan. These options were granted at an exercise price that was less than the
fair value of the Company's stock on the date of grant. In connection with the
grant of these options, the Company recorded $5,180,000 of deferred compensation
which is being amortized in accordance with the vesting schedule of the related
options.

     The following unaudited pro forma consolidated financial information
reflects the results of operations of the Company for the nine-month periods
ended September 30, 2000 and 1999 as if the acquisition of EMAX has occurred on
January 1, 2000 and 1999, respectively, and after giving effect to certain
purchase accounting

                                       12
<PAGE>

adjustments. These pro forma results are not necessarily indicative of what the
Company's operating results would have been had the acquisition actually taken
place on January 1, 2000 or 1999, and may not be indicative of future operating
results.
<TABLE>
<CAPTION>

                                                                               Nine Months        Nine Months
                                                                                  Ended              Ended
                                                                              September 30,      September 30,
                                                                                 2000                1999
                                                                              -------------      -------------
                                                                               (unaudited)        (unaudited)
    <S>                                                                        <C>               <C>
     Revenues...............................................................     $ 38,385,000    $  6,982,000
     Operating Expenses.....................................................       50,304,000      22,568,000
     Amortization of goodwill, purchased intangibles and stock-based
        employee compensation expense.......................................       33,366,000      33,632,000
                                                                                   ----------    ------------
     Operating loss.........................................................      (79,705,000)    (50,042,000)
                                                                                 -----------     ------------
     Net loss...............................................................     $(73,802,000)   $(49,020,000)
                                                                                =============    ============
     Loss before amortization of goodwill, purchased intangibles and
        stock-based employee compensation expense...........................     $(40,436,000)   $(15,388,000)
                                                                                =============    ============
     Net loss per common share..............................................        $   (2.59)       $  (9.62)
                                                                                    =========        ========
</TABLE>

4.   Capital Stock

     On November 19, 1999, the Company completed its initial public offering,
selling 8,625,000 shares of its $.001 par value common stock. Upon the
effectiveness of its initial public offering, all outstanding shares of Series
A, Series C and Series E preferred stock, and all outstanding shares of Class B
common stock were converted into a total of 13,438,185 common shares. The
Company's Class A common stock was also reclassified as common stock with a par
value of $0.001 per share.

     On October 22, 1999, the Board of Directors of the Company approved a
1.516643-for-1 Class A common stock split which was declared effective on
November 12, 1999. All share and per share information in the accompanying
financial statements has been retroactively restated to reflect the effect of
this stock split and the reclassification of the Company's Class A common stock
to common stock.

     Also upon the effectiveness of the Company's initial public offering, the
number of authorized shares of the Company's common stock was increased to
90,000,000 shares and 10,000,000 shares of preferred stock were authorized. At
all times, the Company shall reserve a number of shares of unissued common stock
for the purpose of effecting the conversion of its issued and outstanding shares
of all outstanding warrants and options to purchase the Company's common stock.

5.   Strategic Partnerships

     In October, November, and December 1999, the Company entered into strategic
relationships with a number of key suppliers and buyers of scientific products.
As part of these arrangements, the Company issued to these companies warrants to
purchase the Company's common stock at an exercise price of $0.01 per share. At
September 30, 2000 and December 31, 1999 there were 4,439,180 and 5,035,180
strategic warrants outstanding, respectively, and the Company has recorded net
deferred customer acquisition costs of approximately $24,361,000 and
$391,139,000 at September 30, 2000 and December 31, 1999, respectively. These
amounts are presented net of accumulated amortization of approximately
$6,252,000 and $9,108,000 at September 30, 2000 and December 31, 1999,
respectively. The Company recorded net benefits from stock-based customer
acquisition costs of $989,000 and $2,555,000 for the three and nine months ended
September 30, 2000, respectively, related to the amortization of deferred
customer acquisition costs. These amounts include $100,000 and $300,000 of
amortization of prepaid customer acquisition fees for the three and nine months
ended September 30, 2000, respectively. No such amortization was required for
the three and nine months ended September 30, 1999.

     These strategic relationships also include agreements with several major
enterprise buyers to be their third party electronic aggregator for purchases of
scientific products in North America for a period of three years. Although


                                       13

<PAGE>

these enterprise buyers have agreed to use reasonable efforts to purchase at
least $5 million of scientific products annually through the Company's
marketplace, there are no minimum purchase commitments. The warrants issued in
connection with these relationships vest over a period of three years regardless
of their level of purchases through the Company's electronic marketplace.

     In addition, the Company has agreed to issue to certain major enterprise
buyers additional incentive warrants, the number of which will be based on each
purchaser's volume of purchases through the Company's market place during the
years 2000, 2001 and 2002. These incentive warrants will be issued on February
15, 2001, 2002 and 2003, at an exercise price equal to the price per share of
common stock in the Company's initial public offering, or $16.00 per share, and
will be exercisable upon issuance. Deferred customer acquisition costs will be
recognized at the date of issuance of these incentive warrants in an amount
equal to the estimated fair value of the warrants at the date of issuance
determined using the Black Scholes valuation model and will be amortized to
operating expense over the remaining term of the strategic relationship with
these key buyers. As of September 30, 2000, approximately 55,000 incentive
warrants have been earned but not issued.


ITEM 2.   Management's Discussion and Analysis of Financial Condition and
          Results of Operations

    Some of the statements contained in this Management's Discussion and
Analysis of Financial Condition and Results of Operations contain
forward-looking information. You can identify these statements by
forward-looking words such as "expect," "anticipate," "believe," "goal," "plan,"
"intend," "estimate," "predict," "potential," "continue," "may," "will," and
"should" or similar words. They include statements concerning:

o    future revenues from e-commerce transactions;
o    future revenues from sales of scientific equipment;
o    future gross profits;
o    future development expenses;
o    future sales and marketing expenses;
o    future general and administrative expenses;
o    future stock-based customer acquisition costs;
o    the effects of our restructuring program; and
o    the adequacy of our existing liquidity and capital resources

You should be aware that these statements are subject to known and unknown
risks, uncertainties and other factors, including those discussed in the section
entitled "Factors That May Affect Future Results," that could cause the actual
results to differ materially from those suggested by the forward-looking
statements.

Overview

     SciQuest.com is a Web-based, interactive marketplace for scientific and
laboratory products used by pharmaceutical, clinical, biotechnology, chemical,
industrial and educational organizations worldwide. We have used our extensive
industry expertise to design a marketplace that streamlines the traditionally
inefficient scientific products supply chain. Our marketplace solutions allow
buyers of scientific products to cross-search content and purchase products from
multiple suppliers with a single order. Our approach does not give priority to
any particular scientific products distributor, which allows us to create an
open and scalable marketplace that we believe is more attractive to both buyers
and sellers.

     We were incorporated in November 1995 and commenced operations in January
1996. During 1996, we focused on developing our business model and the required
technology. We did not begin to recognize any revenues until 1997.

     On September 29, 1998, we acquired BioSupplyNet, Inc. This acquisition was
accounted for using the purchase method of accounting with a total purchase
price of approximately $2.0 million. BioSupplyNet publishes the Source Book, an
annual printed catalogue of vendors of biomedical research supplies and
equipment and scientific products for the biomedical research industry. In
addition, at the time of acquisition, BioSupplyNet was in the process of

                                       14
<PAGE>

developing e-commerce technology to allow research scientists, lab technicians
and purchasing agents to quickly identify suppliers of specific scientific
products. We intend to continue to enhance and develop this technology. Since
the acquisition of BioSupplyNet, we have derived revenues from the sale of
advertising in the Source Book.

     On July 30, 1999, we acquired all of the outstanding common stock of
Internet Auctioneers International, Inc. for a total purchase price of $1.4
million. This acquisition was accounted for using the purchase method of
accounting. Internet Auctioneers International provides auction services to
laboratories for the sale of used equipment. We receive a commission for
performing these services, which is recognized as revenues at the time the sale
is finalized.

     On January 14, 2000, we acquired all of the outstanding capital stock of
Intralogix, Inc. for a total purchase price of approximately $2.2 million.
Intralogix provides tools that enable scientists to search, compare and purchase
chromatography products for their research needs.

     On February 2, 2000, we acquired all of the outstanding capital stock of
SciCentral, Inc. for a total purchase price of approximately $2.6 million.
SciCentral, Inc. provides users with a gateway to online science and technology
resources, news and information.

     The Internet Auctioneers International, Intralogix and SciCentral
acquisitions were not financially significant as they related to the purchase
price or past results of operations of the acquired entities. Therefore, pro
forma financial information has not been presented for these acquisitions. These
acquisitions were accounted for using the purchase method of accounting.

     On March 22, 2000, we acquired all of the outstanding capital stock of EMAX
Solution Providers, Inc., a provider of electronic research solutions designed
to optimize pharmaceutical drug research operations and expedite drug discovery,
for the issuance of 1,625,680 shares of our common stock and the assumption of
374,152 outstanding stock options. In addition, we granted to EMAX employees a
total of 113,980 SciQuest.com stock options (the "Additional Options"), pursuant
to the SciQuest.com 1999 Stock Incentive Plan. These Additional Options were
granted at an exercise price that was less than the fair value of our common
stock on the date of grant. In connection with the grant of these options, we
recorded approximately $5.2 million of deferred compensation which is being
amortized in accordance with the vesting schedule of the related options. The
acquisition of EMAX was accounted for using the purchase method of accounting.
The acquisition of EMAX enables us to provide electronic and Internet-based
solutions that are designed to streamline the drug discovery processes of our
customers, including large pharmaceutical, biotechnology and life science
companies, by integrating their supply chains with critical research processes.

     Assuming the acquisition of EMAX had occurred on January 1, 2000, our pro
forma revenues, operating loss and net loss for the nine months ended September
30, 2000 would have been $38.4 million, $79.7 million and $73.8 million,
respectively. This represents an increase of $.8 million in revenues, $11.9
million in operating loss and $11.9 million in net loss, respectively. Excluding
$33.4 million of amortization of goodwill, purchased intangibles and stock-based
employee compensation expense, pro forma net loss would have been $40.4 million.
Assuming the acquisition of EMAX had occurred on January 1, 1999, our pro forma
revenues, operating loss and net loss for the nine months ended September 30,
1999 would have been $7.0 million, $50.0 million and $49.0 million,
respectively. This represents an increase of $5.7 million in revenues, $34.0
million in operating loss and $33.9 million in net loss, respectively. Excluding
$33.6 million of amortization of goodwill, purchased intangibles and stock-based
employee compensation expense, pro forma net loss would have been $15.4 million.
The pro forma results for the nine months ended September 30, 2000 and 1999 do
not include the write-off of purchased in-process research and development.
These pro forma operating results are not necessarily indicative of what our
results would have been had the acquisition of EMAX occurred on January 1, 2000
or January 1, 1999, nor can our future operating results be predicted from these
amounts.

     In October, November and December 1999, we entered into strategic
relationships with a number of key suppliers and buyers of scientific products,
whereby we issued to these suppliers and buyers warrants to purchase the
Company's common stock at an exercise price of $0.01 per share. These warrants
will vest over a period of three to five years and will be exercisable until
2004. We have issued these warrants in connection with these agreements,


                                       15
<PAGE>

as we believe that these relationships are an integral component of our business
plan. At September 30, 2000, 4,439,180 warrants issued to key suppliers and
buyers were outstanding.

     These strategic relationships include agreements to be the exclusive
third-party provider of electronic marketplace services in the United States for
a period of five years for ten key suppliers. Under the terms of these
agreements, these suppliers are not required to sell a minimum amount of
products through our electronic marketplace. The warrants to purchase our common
stock that were issued in connection with these agreements vest over a four or
five year period regardless of the level of sales by the suppliers through our
electronic marketplace.

     We have recorded net deferred customer acquisition costs of approximately
$24.4 million at September 30, 2000, related to these outstanding warrants which
is included as a separate component of stockholders' equity. Deferred customer
acquisition costs are determined based on the difference between the closing
trading price of our common stock and the $0.01 exercise price of the stock
warrants. The amount of deferred customer acquisition costs recognized for all
of the warrants issued to our key suppliers and buyers is adjusted each
reporting period based on changes in the fair value of the warrants until such
date as the warrants are fully vested. Deferred customer acquisition costs will
be amortized to operating expense, using a cumulative catch-up method, over the
term of the related contractual relationship. The Company recorded net benefits
from stock-based customer acquisition costs of $989,000 and $2,555,000 for the
three and nine months ended September 30, 2000, respectively.

     These strategic relationships also include agreements with certain major
enterprise buyers to be their third-party electronic aggregator for purchases of
scientific products in North America for a period of three years. Although these
buyers have agreed to use reasonable efforts to purchase at least $5.0 million
of scientific products annually through our marketplace, there are no minimum
purchase commitments. The warrants issued in connection with these relationships
vest over a period of three years, regardless of their level of purchases
through our electronic marketplace.

     We have also agreed to issue to these certain major enterprise buyers
additional incentive warrants to purchase shares of our common stock with an
exercise price of $16.00 per share, the number of which will be based on each
purchaser's volume of purchases through our marketplace during the years 2000,
2001 and 2002. These incentive warrants will be issued on February 15, 2001,
2002 and 2003, will be fully vested and exercisable upon issuance and will
continue to be exercisable for a period of five years after the date of
issuance. Deferred customer acquisition costs will be recognized at the date of
issuance of these incentive warrants in an amount equal to the estimated fair
value of the warrants at the date of issuance determined using the Black Scholes
valuation model and will be amortized to operating expense over the remaining
term of the strategic relationship with these key buyers. As of September 30,
2000, approximately 55,000 incentive warrants have been earned but not issued.

     In October 2000, the Board of Directors approved a comprehensive
restructuring program. As part of this program, announced in November 2000, we
reduced our workforce by approximately 10%. In connection with this reduction,
we will record a one-time charge of approximately $2.5 million in the fourth
quarter of 2000 related to separation benefits paid to those affected employees
and the write-down of assets related to an unprofitable business line. We expect
this restructuring program to reduce our operating expenses and improve our cash
flow from operations beginning in 2001 as compared to our previous expectations.

     Revenues consist of (1) sales of scientific products in e-commerce
transactions originating on our web sites, (2) sales of scientific equipment,
(3) sales of software licenses and fees for implementation, customization and
maintenance services related to these software licenses, (4) banner advertising
revenues from our web sites, (5) advertising revenues from the Source Book, and
(6) commissions received from the auction of used scientific equipment. Prior to
the launch of our e-commerce marketplace in April 1999, substantially all of our
revenues were derived from advertising on our web sites. Revenues from
e-commerce transactions became a significant source of our revenues in the third
quarter of 1999 and are expected to continue to increase. Revenues from the sale
of scientific equipment were a significant source of revenues in the second and
third quarters of 2000 as we seek to introduce new pharmaceutical, clinical,
biotechnology, chemical, industrial and educational organizations to our
marketplace. Transactions involving the sale of scientific equipment typically
have significantly higher gross sales prices, on a per-transaction basis, than
do transactions for scientific products in e-commerce transactions originating
on our web sites.

                                       16
<PAGE>
     We offer various Web-based solutions where potential buyers can
cross-search content from multiple suppliers and build a multiple line item
order for products from various suppliers. When a purchaser places an order
through our marketplace, we purchase that item from the supplier at either a
pre-negotiated price or at a discount from the supplier's list price and arrange
for shipment to the purchaser. We take legal title to the products purchased at
the date of shipment and relinquish title to our customers upon delivery. After
the customer receives the product, we begin the collection process by presenting
a consolidated invoice to the buyer for the products represented in the order.
Payment by the buyer to us is then made through a traditional account setup and
payment system or, in some cases, by credit card/procurement card. We offer
extended payment terms to our customers who purchase scientific equipment as
these transactions have higher dollar values. We bear all credit risk on sales
that we make and we are obligated to pay the supplier of the products that we
purchase regardless of whether we receive payment from the customer for the
products. For each transaction, we recognize revenue in the amount of the sales
price of the item to the purchaser and recognize the amount paid to the supplier
plus shipping costs as cost of goods sold. The difference between revenues and
cost of goods sold is our gross profit.

     Revenues from sales of scientific products in e-commerce transactions and
from sales of scientific equipment are recorded as product revenues on a gross
basis and are recognized upon receipt by our customers. Product shipments are
made on our designated carriers and we are responsible for shipping costs which
are recorded as cost of revenues.

     EMAX recognizes revenue from the sale of licenses to its software products,
the implementation and customization of its software products and the sale of
maintenance and support contracts. EMAX recognizes revenues from the sale of
licenses to its software products and implementation and customization of these
software products on a percentage-of-completion basis over the period of the
customization and implementation services, which generally ranges from three to
nine months. EMAX recognizes revenues from the sale of maintenance and support
contracts ratably over the period of the maintenance and support agreements,
which is typically twelve months.

     Advertising revenues on banner contracts are recognized ratably over the
period in which the advertisement is displayed. Revenues from advertising
included in the Source Book are recognized at the date the Source Book is
published and distributed. Advertising on our Web sites is sold by Cahners
Business Information. Cahners pays us a percentage of the total advertising
revenues that it receives.

Three Months Ended September 30, 2000 And 1999
   Revenues

     Revenues for the quarter ended September 30, 2000 have been derived
primarily from the sale of scientific products in e-commerce transactions, from
the sale of scientific equipment and from the sale of licenses to our software
products and the implementation and customization of our software products.

     E-commerce revenues increased to $17.9 million for the quarter ended
September 30, 2000 from $.4 million for the quarter ended September 30, 1999.
This increase was primarily due to $9.2 million in revenues from the sale of
scientific products in e-commerce transactions and $8.7 million in revenues from
the sale of scientific equipment for the quarter ended September 30, 2000, as
compared to $.3 million and $0, respectively, for the quarter ended September
30, 1999 as our e-commerce marketplace was not implemented until April 1999 and
as we did not begin selling scientific equipment until the second quarter of
2000. We expect revenues from the sale of scientific products in e-commerce
transactions to decrease beginning in the fourth quarter of 2000 as we plan to
discontinue transacting sales for which we do not recognize an acceptable gross
profit. We expect to continue earning revenues from the sale of scientific
equipment, although we do not expect these sales to continue to comprise a
significant portion of our total revenues. In addition, the acquisition of EMAX
in March 2000 contributed $1.8 million in software license, implementation and
maintenance revenues for the quarter ended September 30, 2000. During the
quarter ended September 30, 2000, two customers accounted for 24% and 15%,
respectively, of total revenues. There can be no assurance that these customers
will continue to purchase at these levels.

                                       17
<PAGE>

   Cost of Revenues

     Cost of e-commerce revenues primarily consists of the purchase price of
scientific products sold in e-commerce transactions, the purchase price of
scientific equipment sold and related shipping costs for these products. Cost of
software license, implementation and maintenance revenues primarily consist of
personnel costs for employees who work directly on the development and
implementation of customized electronic research solutions and who provide
maintenance to customers, and also consists of the amortization of capitalized
software development costs. As we begin to earn revenues from providing new
products and services, we expect certain costs that have historically been
included in operating expenses will be included in cost of revenues.

     Cost of e-commerce revenues increased to $17.5 million for the quarter
ended September 30, 2000 from $.3 million for the quarter ended September 30,
1999. Cost of e-commerce revenues increased primarily due to $9.0 million in
costs related to the sale of scientific products in e-commerce transactions and
$8.5 million in costs related to the sale of scientific equipment during the
quarter ended September 30, 2000 as compared to $.3 million and $0,
respectively, for the quarter ended September 30, 1999 as our e-commerce
marketplace was not implemented until April 1999 and as we did not begin selling
scientific equipment until the second quarter of 2000. In addition, the
acquisition of EMAX in March 2000 contributed $1.2 million to cost of revenues
for the quarter ended September 30, 2000, of which $.5 million related to the
amortization of capitalized software development costs.

Gross Profit

     Gross profit increased to $1.0 million for the quarter ended September 30,
2000 from $21,000 for the quarter ended September 30, 1999. Gross profit
increased as product sales began with the launch of our e-commerce marketplace
in April 1999 and with the sale of scientific equipment which began in the
second quarter of 2000. Gross profit on sales of scientific products and
equipment increased to $.4 million for the quarter ended September 30, 2000 from
$21,000 for the quarter ended September 30, 1999. The acquisition of EMAX in
March 2000 contributed $.6 million of gross profit for the quarter ended
September 30, 2000.

Operating Expenses

     Development Expenses. Development expenses consist primarily of personnel
and related costs to develop, operate and maintain our web sites, aggregate data
and the amortization of capitalized development costs. Development costs
increased to $3.4 million for the quarter ended September 30, 2000 from $3.1
million for the quarter ended September 30, 1999. This increase resulted from
expenses incurred to develop our e-commerce fulfillment system, list suppliers'
products on our web sites and from increased amortization of capitalized
development costs. This increase also includes $.1 million of development
expenses incurred by EMAX, which we acquired in March 2000, related to the
development of electronic research solutions technology. During the quarter
ended September 30, 2000, we capitalized approximately $2.5 million of certain
costs related to software and web site development projects. We expect our
development expenses to remain at a relatively level dollar amount over the next
nine to twelve months. We anticipate an increase in development expenses due to
the amortization of development costs related to the development of additional
functionality for our web sites and the development of the technology acquired
with EMAX, which we expect to be offset by a reduction in development expenses
due to the allocation of development expenditures to cost of sales as we begin
to charge customers for providing technological products and services that we
have historically provided for free.

     Sales and Marketing Expenses. Sales and marketing expenses consist
primarily of salaries and other related costs for sales and marketing personnel,
travel expenses, public relations expenses and marketing materials. Sales and
marketing expenses increased to $8.9 million for the quarter ended September 30,
2000 from $3.0 million for the quarter ended September 30, 1999. This increase
resulted primarily from increased expenses to develop, advertise and promote our
e-commerce marketplace in Europe, the hiring of personnel to staff our newly
formed e-Services unit/division, and $1.0 million in sales and marketing
expenses related to EMAX. We expect our sales and marketing expenses to decrease
over the next six to nine months, after which time we expect such expenses to
remain at a relatively level dollar amount. This will be accomplished primarily
by reducing the number of personnel in our sales and marketing departments in
the fourth quarter of 2000.


                                       18

<PAGE>

     General and Administrative Expenses. General and administrative expenses
consist primarily of personnel and related costs for our customer care
department and general corporate functions, including finance, accounting,
legal, human resources, investor relations and facilities. General and
administrative expenses increased to $6.0 million for the quarter ended
September 30, 2000 from $1.6 million for the quarter ended September 30, 1999.
General and administrative expenses increased primarily as a result of increased
payroll costs due to the increase in the number of customer care and general and
administrative personnel and an increase in professional fees and facilities
costs incurred to support the growth of our business. This increase also
includes $1.0 million of general and administrative expenses incurred by EMAX.
In addition, we have experienced an increase in general and administrative costs
as a result of becoming a public company in November 1999, such as investor
relations costs, directors and officers' insurance costs and increased legal and
audit costs. We expect general and administrative expenses to increase in the
fourth quarter of 2000, primarily due to increased facility costs and consulting
services and then remain at a relatively level dollar amount thereafter for the
next nine to twelve months.

   Stock-based Employee Compensation Expense

     Stock-based employee compensation expense increased to $1.0 million in the
quarter ended September 30, 2000 from $99,000 in the quarter ended September 30,
1999 due to an increase in the number of stock options that had been issued to
employees with exercise prices less than fair value on the date of grant since
September 30, 1999. This increased number of stock options issued to employees
with exercise prices less than fair value on the date of grant includes the
113,980 Additional Options issued to EMAX employees in connection with the
acquisition. In addition, in July of 1999 and in February 2000, we entered into
two employment agreements with personnel from acquired subsidiaries that
required the recognition of deferred compensation. Deferred compensation
recorded due to the issuance of such stock options and employment agreements is
charged to stock-based employee compensation expense over the vesting term of
the options and the term of the employment agreements, respectively.

   Stock-based Customer Acquisition Costs

     Stock-based customer acquisition costs represent the amortization of
deferred customer acquisition costs that were initially recorded in November
1999 upon the issuance of common stock warrants to key suppliers and customers.
Stock-based customer acquisition costs resulted in a net benefit of $1.0 million
in the quarter ended September 30, 2000. There were no such costs in the quarter
ended September 30, 1999. The value of these warrants is adjusted each reporting
period based upon the closing trading price of the Company's common stock at
each balance sheet date. Decreases in the Company's closing trading price from
one reporting period to the next will likely result in a benefit to the Company,
and increases in the Company's closing trading price will likely result in
charges to expense. Because the amortization of these costs is dependent upon
the trading price of our common stock, we cannot predict the future impact of
this on our results of operations.

   Amortization of Goodwill and Other Intangible Assets

     Amortization of goodwill and other intangible assets increased to $10.2
million for the quarter ended September 30, 2000 from $65,000 in the quarter
ended September 30, 1999. This increase is the primarily the result of $7.9
million of amortization of goodwill and $1.8 million of amortization of a
trademark resulting from the acquisition of EMAX.

   Interest Income

     Interest income, net, consists of interest income earned on cash deposited
in money market accounts and invested in short and long term U.S. Government
obligations partially reduced by interest expense incurred on capital lease
obligations. Net interest income increased to $1.7 million for the quarter ended
September 30, 2000 from net interest income of $.5 million for the quarter ended
September 30, 1999. The increase in net interest income was primarily the result
of interest earned on proceeds received from our initial public offering in
November 1999.

                                       19
<PAGE>

Nine months Ended September 30, 2000 and 1999

   Revenues

     Revenues for the nine months ended September 30, 2000 have been derived
primarily from the sale of scientific products in e-commerce transactions, from
the sale of scientific equipment and from the sale of licenses to our software
products and the implementation and customization of our software products.

     E-commerce revenues increased to $34.2 million for the nine months ended
September 30, 2000 from $1.2 million for the nine months ended September 30,
1999. This increase was primarily due to $23.0 million in revenues from the sale
of scientific products in e-commerce transactions and $11.2 million from the
sale of scientific equipment during the nine months ended September 30, 2000, as
compared to $.4 million and $0, respectively, for the nine months ended
September 30, 1999 as our e-commerce marketplace was not implemented until April
1999 and as we did not begin selling scientific equipment until the second
quarter of 2000. We expect revenues from the sale of scientific products in
e-commerce transactions to decrease beginning in the fourth quarter of 2000 as
we plan to discontinue transacting sales for which we do not recognize an
acceptable gross profit. We expect to continue earning revenues from the sale of
scientific equipment, although we do not expect these sales to continue to
comprise a significant portion of our total revenues. In addition, the
acquisition of EMAX in March 2000 contributed $3.4 million in software license,
implementation and maintenance revenues for the nine months ended September 30,
2000. During the nine months ended September 30, 2000, two customers accounted
for 19% and 12%, respectively, of total revenues. There can be no assurance that
these customers will continue to purchase at these levels.

Cost of Revenues

     Cost of revenues primarily consists of the purchase price of scientific
products sold in e-commerce transactions, the purchase price of scientific
equipment sold and related shipping costs for these products. Cost of software
license, implementation and maintenance revenues primarily consist of personnel
costs for employees who work directly on the development and implementation of
customized electronic research solutions and who provide maintenance to
customers, and also consists of the amortization of capitalized software
development costs. As we begin to earn revenues from providing new products and
services, we expect certain costs that have historically been included in
operating expenses will be included in cost of revenues.

     Cost of e-commerce revenues increased to $33.1 million for the nine months
ended September 30, 2000 from $.8 million for the nine months ended September
30, 1999. Cost of e-commerce revenues increased primarily due to $22.2 million
in costs related to the sale of scientific products in e-commerce transactions
and $10.9 million in costs related to the sale of scientific equipment during
the nine months ended September 30, 2000 as compared to $.4 million and $0,
respectively, for the nine months ended September 30, 1999 as our e-commerce
marketplace was not implemented until April 1999 and as we did not begin selling
scientific equipment until the second quarter of 2000. In addition, the
acquisition of EMAX in March 2000 contributed $2.3 million to cost of revenues
for the nine months ended September 30, 2000, of which $1.0 million related to
the amortization of capitalized software development costs.

   Gross Profit

     Gross profit increased to $2.2 million for the nine months ended September
30, 2000 from $.4 million for the nine months ended September 30, 1999. Gross
profit has increased as product sales began with the launch of our e-commerce
marketplace in April 1999 and with the sale of scientific equipment which began
in the second quarter of 2000. Gross profit on sales of scientific products and
equipment increased to $1.1 million for the nine months ended September 30, 2000
from $.4 million for the nine months ended September 30, 1999. The acquisition
of EMAX in March 2000 contributed $1.1 million of gross profit for the nine
months ended September 30, 2000.


                                       20

<PAGE>
   Operating Expenses

     Development Expenses. Development expenses consist primarily of personnel
and related costs to develop, operate and maintain our Web sites, aggregate data
and the amortization of capitalized development costs. Development costs
increased to $10.8 million for the nine months ended September 30, 2000 from
$6.3 million for the nine months ended September 30, 1999. This increase
resulted from expenses incurred to develop our e-commerce fulfillment system,
list suppliers' products on our web sites and from increased amortization of
capitalized development costs. This increase also includes $1.2 million of
development expenses incurred by EMAX related to the development of electronic
research solutions technology. During the nine months ended September 30, 2000,
we capitalized approximately $4.0 million of certain costs related to software
and web site development projects. We expect our development expenses to remain
at a relatively level dollar amount over the next nine to twelve months. We
anticipate an increase in development expenses due to the amortization of
development costs related to the development of additional functionality for our
web sites and the development of the technology acquired with EMAX, which we
expect to be offset by a reduction in development expenses due to the allocation
of developmental expenditures to cost of sales as we begin to charge customers
for providing technological products and services that we have historically
provided for free.

     Sales and Marketing Expenses. Sales and marketing expenses consist
primarily of salaries and other related costs for sales and marketing personnel,
travel expenses, public relations expenses and marketing materials. Sales and
marketing expenses increased to $20.3 million for the nine months ended
September 30, 2000 from $6.2 million for the nine months ended September 30,
1999. This increase resulted primarily from the hiring of additional sales and
marketing personnel to market our products and services and increased expenses
to advertise and promote our e-commerce marketplace, and to a lesser extent,
sales and marketing expenses related to EMAX, BioSupplyNet and Internet
Auctioneers International. We expect our sales and marketing expenses to
decrease over the next six to nine months, after which time we expect such
expenses to remain at a relatively level dollar amount. This will be
accomplished primarily by reducing the number of personnel in our sales and
marketing departments in the fourth quarter of 2000.

     General and Administrative Expenses. General and administrative expenses
consist primarily of personnel and related costs for our customer care
department and general corporate functions, including finance, accounting,
legal, human resources, investor relations and facilities. General and
administrative expenses increased to $14.9 million for the nine months ended
September 30, 2000 from $3.8 million for the nine months ended September 30,
1999. General and administrative expenses increased primarily as a result of
increased payroll costs due to the increase in the number of general and
administrative personnel and an increase in professional fees and facilities
costs incurred to support the growth of our business. This increase also
includes $1.9 million of general and administrative expenses incurred by EMAX,
which was acquired in March 2000. In addition, we have experienced an increase
in general and administrative costs as a result of becoming a public company in
November 1999, such as investor relations costs, directors and officers'
insurance costs and increased legal and audit costs. We expect general and
administrative expenses to increase in the fourth quarter of 2000, primarily due
to increased facility costs and consulting services and then remain at a
relatively level dollar amount thereafter for the next nine to twelve months.

   Stock-based Employee Compensation Expense

     Stock-based employee compensation expense increased to $4.2 million in the
nine months ended September 30, 2000 from $.1 million in the nine months ended
September 30, 1999 due to an increase in the number of stock options that had
been issued to employees with exercise prices less than fair value on the date
of grant since September 30, 1999. This increased number of stock options issued
to employees with exercise prices less than fair value on the date of grant
includes the 113,980 Additional Options issued to EMAX employees in connection
with the acquisition. In addition, in July 1999 and in February 2000, we entered
into two employment agreements with personnel from acquired subsidiaries that
required the recognition of deferred compensation. Deferred compensation
recorded due to the issuance of such stock options and employment agreements is
charged to stock-based employee compensation expense over the vesting term of
the options and the term of the employment agreements, respectively.
                                       21
<PAGE>

Stock-based Customer Acquisition Costs

     Stock-based customer acquisition costs represent the amortization of
deferred customer acquisition costs that were initially recorded in November
1999 upon the issuance of common stock warrants to key suppliers and customers.
Stock-based customer acquisition costs resulted in a net benefit of $2.6 million
in the nine months ended September 30, 2000. There were no such costs in the
nine months ended September 30, 1999. The value of these warrants is adjusted
each reporting period based upon the closing trading price of the Company's
common stock at each balance sheet date. Decreases in the Company's closing
trading price from one reporting period to the next will likely result in a
benefit to the Company, and increases in the Company's closing trading price
will likely result in charges to expense. Because the amortization of these
costs is dependent upon the trading price of our common stock, we cannot predict
the future impact of this on our results from operations.

   Purchased In-process Research and Development

     For the nine months ended September 30, 2000, we recognized an in-process
research and development charge of $0.7 million as a result of the acquisition
of EMAX. Based on management's valuation of EMAX and its assets, we allocated
$0.7 million of the EMAX purchase price of $126 million to software products
being developed by EMAX that had not reached technological feasibility and had
no alternative use at the date of the acquisition of EMAX. We intend to use this
software in the development of the e-commerce and scientific products search
capabilities on our Web sites. At the date of the acquisition, these software
products being developed by EMAX were approximately 15% complete. We estimated
at the acquisition date that we would incur a total of approximately $3.0
million to complete the development of these software products and that the
development would be completed by December 2000. As of September 30, 2000, we
had incurred approximately $1.9 million in software development costs related to
these software products. The remaining $125.3 million of the purchase price of
EMAX was allocated to the tangible and intangible assets of EMAX and to
goodwill.

Amortization of Goodwill and Other Intangible Assets

     Amortization of goodwill and other intangible assets increased to $21.6
million for the nine months ended September 30, 2000 from $.1 million in the
nine months ended September 30, 1999. This increase is the primarily the result
of $16.6 million of amortization of goodwill and $3.8 million of amortization of
a trademark resulting from the acquisition of EMAX which occurred in March 2000.

   Interest Income

     Interest income, net, consists of interest income earned on cash deposited
in money market accounts and invested in short and long term U.S. Government
obligations partially reduced by interest expense incurred on capital lease
obligations. Net interest income increased to $5.8 million for the nine months
ended September 30, 2000 from net interest income of $.8 million for the nine
months ended September 30, 1999. The increase in net interest income was
primarily the result of interest earned on proceeds received from our initial
public offering in November 1999.

   Liquidity and Capital Resources

     We have primarily funded our operations through private placements of our
preferred stock during 1998 and 1999 and our initial public offering which
closed in November 1999. As of September 30, 2000, we had total cash and
investments of $90.1 million, which is comprised of cash and cash equivalents of
$24.1 million, short term investments of $44.1 million and long term investments
of $21.9 million.

                                       22
<PAGE>

     Cash used in operating activities was $43.7 million and $12.9 million
during the nine months ended September 30, 2000 and 1999, respectively. Cash
used in operating activities was principally for payments to our suppliers for
purchases of scientific products and equipment, the development of our web
sites, the development of our e-commerce marketplace, payment of the expansion
of our sales and marketing force, increased advertising costs and the expansion
of the administrative and operations staff to support our growth.

     Cash used in investing activities during the nine months ended September
30, 2000 and 1999 was $30.9 million and $23.7 million, respectively. Cash used
in investing activities has primarily been comprised of purchases of investments
in US government obligations, commercial paper and corporate bonds, net of
maturities, purchases of computer equipment and the capitalization of certain
costs associated with the development of our web sites and with the development
of EMAX's electronic research software systems. During the nine months ended
September 30, 2000, we paid approximately $.3 million in cash to acquire
Intralogix and SciCentral and paid approximately $2.6 million in expenses
related to the acquisition of EMAX. This was partially offset by $.5 million of
cash received from these acquired companies

     Cash provided by financing activities during the nine months ended
September 30, 2000 and 1999 was $.6 million and $36.1 million, respectively.
During the nine months ended September 30, 2000, the Company received
approximately $1.3 million in proceeds from exercises of stock options, common
stock warrants and by the direct sale of restricted stock to an officer of the
Company. In May and June, 1999, we sold 3,312,720 shares of series D convertible
preferred stock in a private placement transaction for $11.32 per share that
resulted in proceeds of $35.9 million, net of issuance costs of $1.6 million.
Additionally, in March 1999, we sold 89,408 shares of series C preferred to an
officer of the Company at $2.80 per shares and received net proceeds of
$250,000.

     During the quarter ended September 30, 2000, we purchased scientific
equipment from a key supplier, which will result in payments by us of
approximately $3.9 million in the quarter ending December 31, 2000. The sales of
these products occurred in the quarter ended September 30, 2000. The related
receivables will be collected during the next six months.

     We believe that our existing liquidity and capital resources, including the
proceeds resulting from the sale of our common stock in our initial public
offering, will be sufficient to satisfy our cash requirements for the next two
years. To the extent that such amounts are insufficient, we will be required to
raise additional funds through equity or debt financing. There can be no
assurance that we will be able to raise such funds on favorable terms, or at
all.

New Accounting Pronouncements

     In September 1998, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 133, "Accounting for Derivative
Investments and Hedging Activities" ("SFAS No. 133"). SFAS No. 133 establishes a
new model for accounting for derivatives and hedging activities and supercedes a
number of existing standards. SFAS No. 133 is effective for all fiscal quarters
of fiscal years beginning after September 15, 2000. The adoption of SFAS No.
133, as amended, is not expected to have a material impact on our consolidated
financial position or results of operations.

     In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements" ("SAB
101") which addresses certain criteria for revenue recognition. SAB 101 is
required to be adopted for reporting periods no later than the fourth fiscal
quarter of the fiscal year beginning after December 15, 1999. The adoption of
SAB 101 is not expected to have a material impact on our consolidated financial
position or results of operations.

     As a result of the acquisition of EMAX, the Company has determined that it
has separately reportable operating segments, as defined by Statement of
Financial Accounting Standards No. 131, "Disclosures about Segments of an
Enterprise and Related Information" ("SFAS No. 131"). SFAS No. 131 will require
the Company to disclose certain financial information about operating segments,
of which the Company has preliminarily identified two. As SFAS No. 131 does not
require adoption in interim financial statements in the initial year of its
application, the Company will adopt the provisions of SFAS No. 131 in its annual
filing on Form 10-K for the year ended December 31, 2000.

                                       23
<PAGE>

Factors That May Affect Future Results

Since we have a limited operating history, forecasting future performance may be
difficult.

     We commenced operations in 1995, first recognized revenues in 1997 and
launched our interactive e-commerce Web site in April 1999. Accordingly, we have
only a limited operating history on which to evaluate our business. As a result
of our limited operating history, the emerging nature of the online scientific
products market and the evolving nature of our business model, we may be unable
to accurately forecast our revenues. We incur expenses based predominantly on
operating plans and estimates of future revenues. For instance, sales of
scientific equipment commenced in the second quarter of 2000 and revenues from
our new e-Services division are expected to commence in the first quarter of
2001. In addition, we are adjusting our pricing and business model for our
European operations. As a result, revenues to be generated from these activities
will be particularly difficult to forecast accurately. Our expenses are to a
large extent fixed. We may be unable to adjust our spending in a timely manner
to compensate for any unexpected revenue shortfalls. Accordingly, a failure to
meet our revenue projections will have an immediate and negative impact on
profitability. In addition, we have commenced a comprehensive restructuring
program in an effort to reduce operating expenses. If this restructuring program
adversely affects our revenues and/or fails to adequately reduce our expenses,
our future earnings will be negatively impacted. Finally, we cannot be certain
that our evolving business model will be successful, particularly in light of
our limited operating history.

We have a history of losses and anticipate incurring losses in the future. We
may not achieve profitability.

     We incurred net losses of $33.2 million for the year ended December 31,
1999 and $61.9 million for the nine months ended September 30, 2000. As of
September 30, 2000, we had an accumulated deficit of $100.6 million. If our
acquisition of EMAX had taken place on January 1, 1999, our pro forma net losses
for the year ended December 31, 1999 would have been $75.8 million. We expect to
incur substantial operating losses and continued negative cash flow from
operations for the foreseeable future. We will also incur a one-time charge of
approximately $2.5 million in the fourth quarter of 2000 related to our
restructuring program, which will adversely affect our earnings for that
quarter. In fact, we expect to continue generating losses through at least
December 31, 2002 because, as part of our strategy to offer new products,
subscriptions and services, our spending on items such as sales and marketing,
content development, technology and operating infrastructure will exceed the
revenues we anticipate earning from the sale of these new products,
subscriptions and services. If these expenses do not generate increased
revenues, our earnings may be materially and adversely affected and anticipated
net losses may be greater than expected. We may not be able to increase revenues
sufficiently to achieve profitability.

Our future profitability and cash flows are dependent upon our ability to
control expenses.

     Our operating plan to achieve profitability is based upon estimates of our
future expenses. For instance, we have estimated that our development expenses
will remain at a relatively level dollar amount for the next nine to twelve
months, that our sales and marketing expenses will decrease over the next six to
nine months and that our general and administrative expenses will increase in
the fourth quarter of 2000 and then remain at a relatively level dollar amount
thereafter for the next nine to twelve months. If our future expenses are
greater than anticipated, our ability to achieve profitability when expected may
be negatively impacted. In addition, greater than anticipated expenses may
negatively impact our cash flows, which could cause us to expend our capital
faster than anticipated. While we expect our existing capital to be sufficient
for the next two years, if our cash flows are negatively impacted, we may be
required to raise additional capital sooner than expected.

Unless a broad range of purchasers and suppliers of scientific products adopt
our e-commerce solution, we will not be successful.

     Our success will require, among other things, that our solutions gain broad
market acceptance by our customers, suppliers, users and strategic partners. For
example, purchasers may continue purchasing products through their existing
methods and may not adopt a Web-based solution because of:

     o    their comfort with current purchasing habits and direct supplier
          relationships;
     o    the costs and resources required to switch purchasing methods;

                                       24
<PAGE>

     o    the need for products not offered through our Web site;
     o    security and privacy concerns; or
     o    general reticence about technology or the Internet.

If we do not successfully market the SciQuest.com brand, our business may
suffer.

     We believe that establishing, maintaining and enhancing the SciQuest.com
brand is critical in attracting and expanding traffic to our Web sites. There
are a number of Web sites that offer competing services. Some of these sites
already have well-established brands in either online services or the scientific
products industry. As a result, it is critical that we maintain and enhance our
brand. We believe that increased competition may make establishing and
maintaining our brand significantly more expensive. Promotion of our brand will
depend largely on continuing our sales and marketing efforts and providing a
high-quality online experience. We expect to reduce our spending on sales and
marketing significantly in the fourth quarter of 2000 and the in first half of
2001 from current levels. This reduction in spending could materially and
adversely affect our sales and marketing efforts. We cannot be certain that we
will be successful in marketing the SciQuest.com brand. If we are unable to
successfully promote our brand, or if we incur substantial expenses in
attempting to do so, our revenues and earnings could be materially and adversely
affected.

If we are unable to increase our transaction volume, our future revenues may
suffer.

     We expect that a substantial portion of our future revenues will be
generated by the products offered by us for sale through our e-commerce
marketplace. Accordingly, our revenues will be highly dependent on the dollar
volume of transactions conducted through our Web sites. Our profits depend upon
the discount levels we are able to negotiate with our suppliers. To maintain
revenue growth, we will need to increase the total dollar value of transactions
conducted through our Web sites. In order to increase our transaction volume, we
will need to:

     o    generate higher and continuously increasing levels of traffic, from
          both new and repeat visitors, to our Web sites;
     o    increase the percentage of visitors to our Web sites who purchase
          scientific products; and
     o    increase the average transaction size and/or number of repeat
          purchases.

Failure to do one or more of the foregoing could have a material adverse effect
on our revenues.

Sales of scientific equipment, which may result in lower gross margins, have
comprised a significant portion of our revenue over the last six months. The
failure to replace these revenues with revenues from e-commerce transactions in
the long-term could have a material adverse effect on our revenues and earnings.

     We expect to continue earning revenues from the sale of scientific
equipment although we do not expect such sales to continue to comprise a
significant portion of our total revenues in the future. Sales of scientific
products often have lower gross margins than our typical e-commerce
transactions. Accordingly, if we experience a disproportionate amount of our
revenues from the sale of scientific equipment, our aggregate gross margins
could be adversely affected. We do not expect revenues from such transactions to
contribute significantly to revenues on a go-forward basis. However, if we are
not able to replace these revenues with revenues from e-commerce transactions,
our revenues and earnings will be materially and adversely affected.

Unless we negotiate favorable pricing terms with our suppliers, our profit
margins will be adversely affected.

     Our profits depend upon the prices we are able to negotiate with our
suppliers. We anticipate that the prices we negotiate with our suppliers will
vary based on a number of factors such as:

                                       25
<PAGE>

     o    size of supplier;
     o    product portfolio;
     o    relationship with key customers;
     o    degree to which products are critical to our customers;
     o    extent to which transactions are conducted electronically; and
     o    extent that costs are shared with us.

     Our profit margins may decline in the future, particularly as competition
in the scientific products industry increases. A significant decline in profit
margins without a corresponding increase in transaction volume would adversely
affect our earnings.

If we cannot timely and accurately add supplier product data to our e-commerce
database, we may lose sales and customers, which would adversely affect our
revenues.

     Currently, we are responsible for loading supplier product information into
our database and categorizing the information for search purposes. We currently
have a backlog of varying amounts of product data from approximately 150
companies to be loaded in our e-commerce marketplace. We anticipate that a
majority of these products will be loaded into the e-commerce marketplace by the
end of the first quarter of 2001. However, we continuously receive new product
data to load. We generally will not derive profit from these products until this
data is loaded into our system. Timely loading of these products into our
database depends upon a number of factors, including the file formats of the
data provided to us by suppliers and our ability to further automate and expand
our operations to accurately load this data into our product database, any of
which could delay the actual loading of these products beyond the dates
estimated by us.

     In addition, we are generally obligated under our supplier agreements to
load updated product data into our database for access through our marketplace
within a reasonable period of time following their delivery from the supplier.
Our current supplier data backlog could make it difficult for us to meet these
data update obligations to our suppliers. While we intend to further automate
the loading and updating of supplier data on our system, we cannot assure you
that we will be able to do so in a timely manner. Although we screen our
suppliers' information before we make it available to our customers and users,
we cannot guarantee that the product information available in our e-commerce
marketplace will always be accurate, complete and current, or comply with
governmental regulations. This could expose us to liability or result in
decreased adoption and use of our Internet-based purchasing solution, which
could reduce our revenues and therefore have a negative effect on our results of
operations and financial condition.

Sales to larger customers may increase the length of our sales cycle and
decrease our profit margins.

     Increasing sales to larger buyers is an important element of our business
strategy. As we sell more sophisticated solutions to larger organizations, we
expect the time from initial contact to final approval to increase. During this
sales cycle, we may expend substantial funds and management resources without
any corresponding revenue. If approval is delayed or does not occur, our
financial condition and operating results for a particular period may be
adversely affected. Approvals are subject to delays over which we have little or
no control, including the following:

     o    potential customers' internal approval processes;
     o    implementation of systems integration solutions;
     o    customers' concerns about implementing a new strategy and method of
          doing business; and
     o    seasonal and other timing effects.

                                       26
<PAGE>
     Increased sales to larger accounts may result in lower or negative profit
margins as larger customers typically have greater leverage in negotiating the
price and other terms of business relationships. We also typically incur costs
associated with customization of our systems with a sale to a large account. If
we do not generate sufficient transaction volume to offset any lower margins or
these increased costs, our operating results may be materially and adversely
affected. Also, the time between billing and receipt of revenues is often longer
when dealing with larger accounts due to increased administrative overhead.

If we are unable to list a broad range of products on commercially favorable
terms, our marketplace will be less attractive to potential buyers.

     A number of factors could significantly reduce the number of products and
product sources listed on our Web sites, including the following:

     o    consolidation among suppliers; and
     o    exclusive arrangements signed by suppliers with our competitors.

     If the number of products and product sources that are available for
listing is reduced, the effectiveness of our Web sites and their attractiveness
to potential buyers could be materially and adversely affected.

If we are unable to retain a critical mass of suppliers and customers, our
ability to grow our business will be adversely affected.

     Our business model depends in large part on our ability to build a critical
mass of products and suppliers. To attract and maintain suppliers we must build
a critical mass of customers. However, customers must perceive value in our
purchasing solution which, in large part, depends upon the breadth of the
product offerings from our suppliers. Creating a network effect, where the value
to buyers and suppliers alike increases as the number of participants increases,
is a key component of our strategy. If we are unable to increase the number of
suppliers and draw more customers to our Web sites, we will not be able to
benefit from this network effect. As a result, the overall value of our
purchasing solution would be harmed, which would negatively affect our revenues
and earnings.

Our new e-Services division may require substantial investment with no guarantee
of success.

     In July 2000, we announced the creation of a new e-Services division. Among
the activities of this unit will be the provision of information services,
subscriptions to on-line research tools and data management services for our
buyers and suppliers. We intend to charge a fee for these services, although the
fee structure has not yet been finalized. Historically, we have provided many of
these services to our customers free of charge. New customers may not be willing
to pay for these services on favorable terms or at all. We cannot assure you
that the e-Services division will achieve market acceptance, generate
significant revenues or otherwise operate profitably. The investment of
significant resources and capital in this division without achieving significant
revenues from it could have a material adverse effect on our earnings.

If suppliers terminate their agreements with us, our product offerings may
suffer.

     Following an initial one-year term, many of our standard supplier
agreements may be terminated by either party on 90 days' notice. After
expiration of the initial term, such suppliers may terminate or seek to
renegotiate their agreements. If a significant number of suppliers terminate
their agreements with us, the range of products we can offer would be adversely
affected. The ability of suppliers to terminate their agreements may result in
negotiating new agreement terms that are less favorable to us, which could have
a material adverse effect on our earnings.

If our exclusive suppliers elect to terminate the exclusive nature of their
agreements with us, our business could be adversely affected.

     Our exclusive supplier agreements have a five-year term, but the exclusive
nature of such agreements may be terminated after 18 months. If a significant
number of the exclusive suppliers terminate the exclusive nature of such

                                       27
<PAGE>

agreements, the volume of our order flow will be reduced significantly. We may
also be forced to negotiate new agreements with terms that are less favorable to
us.

We have relied and continue to rely on a limited number of large customers for a
significant portion of our revenues. Losing one or more of these customers may
adversely affect our revenues.

     We expect that for the foreseeable future we will generate a significant
portion of our revenues from a limited number of large customers. Further, our
large customers are not obligated to use our purchasing solution exclusively or
for any minimum number of transactions or dollar amounts. In addition, large
individual transactions with these customers may represent an increasing
percentage of our revenues. These large transactions are often non-recurring,
making it difficult to predict future transactions. The failure of one or more
large transactions to occur in any given period may materially and adversely
affect our revenues for such period. Our contracts with our customers are for
limited terms and our customers may discontinue use of our system at any time
upon short notice and without penalty. If we lose any of our large customers or
if we are unable to add new large customers, our revenues will not increase as
expected. In addition, our reputation and brand name would be harmed.

Since we rely on third-party suppliers and carriers to fulfill orders for our
customers, we have limited control over the timing and accuracy of order
fulfillment. As a result, we may not be able to guarantee customer satisfaction.

     We do not carry inventory or directly supply products. As a result, we rely
on our suppliers and carriers for rapid order fulfillment and other customer
service functions to ensure buyer satisfaction. If our suppliers do not provide
high quality customer service, our business reputation and customer satisfaction
could be materially and adversely affected. Most of our supplier arrangements do
not guarantee the availability of merchandise, establish guaranteed prices or
require continuity of pricing practices. As a result, we have little or no
control over the fulfillment of buyers' orders. In order to be successful, we
must maintain relationships with suppliers that will produce, stock and deliver
high quality products to buyers through our Web sites.

     We rely on third-party carriers to ensure accurate and timely delivery of
products to buyers. Although suppliers are responsible for product shipment, we
designate the carrier and are responsible for carrier charges. We cannot be
certain that our carriers will consistently provide high quality performance. If
our carriers fail to deliver products accurately and on a timely basis, our
reputation and business could be materially and adversely affected.

If our Web sites and transaction processing systems are not able to adequately
service increasing traffic levels, our ability to satisfy our customers and
maintain revenue growth may suffer.

     Our success depends in large part on the number of buyers who use our Web
sites to purchase scientific supplies and products. Accordingly, our Web sites,
transaction-processing systems and network infrastructure must be able to
service increasing traffic levels while maintaining adequate buyer service
levels. Any system interruptions or delays in our transaction system would
reduce the volume of sales and the attractiveness of our service offerings,
which could have a material adverse effect on our customer satisfaction and our
ability to maintain revenue growth. We have experienced infrequent system
interruptions in the past during implementation of system upgrades. These
interruptions could continue to occur from time to time and could have a
material adverse effect on our service offerings. Substantial increases in the
volume of traffic on our Web sites or the number of purchases made by buyers
will require expansion and upgrades of our technology, transaction-processing
systems and network infrastructure. We cannot be certain that our
transaction-processing systems and network infrastructure will be able to
accommodate traffic in the future.

If we are not able to successfully integrate our systems with the internal
systems of our key suppliers and buyers, our operating costs and relationships
with our suppliers and buyers will be adversely affected.

     A key component of all services is the efficiencies created for suppliers
and buyers through our online systems. In order to create these efficiencies, it
will often be necessary that our systems integrate with each major supplier's
and buyer's internal systems, such as inventory, customer service, technical
service, freight programs and financial systems. In addition, there is little
uniformity in the systems used by our suppliers and buyers. The integration with
our suppliers' systems also involves the downloading of a significant amount of
data, which increases the resources

                                       28
<PAGE>
needed to execute the integration. If these systems are not successfully
integrated, our operating costs and relationships with our suppliers and buyers
would be adversely affected, which could have a material adverse effect on our
financial condition and results of operations.

Our computer and telecommunications systems are in a single location, which
makes them more vulnerable to damage or interruption.

     Substantially all of our computer and telecommunications systems are
located in the same geographic area. These systems are vulnerable to damage or
interruption from fire, flood, power loss, telecommunications failure, break-ins
and similar events. While we have business interruption insurance, this coverage
may not adequately compensate us for lost business. Although we have implemented
network security measures, our systems, like all systems, are vulnerable to
computer viruses, physical or electronic break-ins and similar disruptions.
These disruptions could lead to interruptions, delays, loss of data or the
inability to accept and confirm buyer purchases. Any of these occurrences could
have a material adverse effect on our revenues.

We bear the risk of credit sales on our Web sites, which could put a significant
strain on our liquidity and capital resources.

     Our supplier agreements generally require us to pay the supplier for any
orders processed through our Web sites as we usually take title to these
products at the time of shipment. Accordingly, if a buyer fails to pay for the
products it purchased, we would be obligated to pay the supplier. Thus, we bear
the risk of collection. We also may be required to refund payments to buyers for
products returned to the supplier. Slow payment by buyers for products purchased
would negatively impact our cash flows. As our transaction volume and average
transaction size grow, these risks will increase. In isolated instances, we have
agreed to extend payment terms with our customers for large purchases, which
increases our credit risk and may negatively impact our cash flows. We generally
do not process an order from a buyer without a credit card or other payment
confirmation although we do extend credit terms to certain qualified buyers.
However, we cannot be certain that our credit confirmation practices will be
effective to protect us against these payment obligations. If a significant
number of buyers default on their payment obligations, or suppliers fail to
refund payments to us for products returned by our buyers, or buyers do not pay
their obligations to us on time, we could incur significant and immediate cash
payment obligations or suffer significant cash flow constraints. These
obligations could put a significant strain on our liquidity and capital
resources, which could prevent us from using our working capital to further
expand our business or require us to obtain additional financing.

If we are not able to effectively manage our growth, our business may suffer.

     We are rapidly expanding our operations. We expect this expansion to
continue at an accelerated rate. This expansion has placed, and is expected to
continue to place, a significant strain on our management, operational and
financial resources. For example, we may be unable to increase the scale of our
operations (including order fulfillment, customer service, transaction
processing and other "back office" operations) to account for the increase in
transaction volume that our supplier and buyer growth creates. We have recently
commenced a restructuring program that resulted in the reduction of our
workforce by approximately 10%. This staff reduction could adversely affect our
ability to manage and continue the growth of our operations. If we are unable to
manage the growth of our business effectively, our earnings could be materially
and adversely affected.

     We have also recently acquired EMAX. We could have difficulty in
effectively assimilating and integrating EMAX into our operations. Any
difficulties in this process could disrupt our ongoing business, distract our
management, increase our expenses and otherwise adversely affect our business.

     Many of our employees have only recently joined us. Additionally, several
of our key executives have been employed by us for two years or less. If our
employees do not work well together or some of our employees do not succeed in
their designated roles, our financial condition and results of operations could
be materially adversely affected. We cannot be certain that our management,
operational and financial resources will be adequate to support our future
operations.
                                       29
<PAGE>

If we fail to attract and retain key employees, our business may suffer.

     A key factor of our success will be the continued services and performance
of our executive officers and other key personnel. If we lose the services of
any of our executive officers, our financial condition and results of operations
could be materially and adversely affected. We do not have long-term employment
agreements with any of our key personnel. Our success also depends upon our
ability to identify, hire and retain other highly skilled technical, managerial,
editorial, marketing and customer service professionals. Competition for this
personnel is intense. In particular, it is important that we hire additional
customer service personnel in order to maintain high quality service and
maintain buyer and supplier loyalty. We cannot be certain of our ability to
identify, hire and retain sufficiently qualified personnel. For example, we may
encounter difficulties in attracting a sufficient number of qualified software
developers and operations personnel for our online services and
transaction-processing systems. Failure to identify, hire and retain necessary
technical, managerial, editorial, merchandising, marketing and buyer service
personnel could have a material adverse effect on our financial condition and
results of operations.

If we are unable to adapt our services to rapid technological change in online
commerce, our revenues and profits could be materially and adversely affected.

     The Internet and the online commerce industry undergo rapid changes in
technology, products and services, user profiles and operating standards. These
changes could render our Web sites and proprietary technology and systems
obsolete. We must continually improve the performance, features and reliability
of our online services, particularly in response to our competition.

     Our success will depend, in part, on our ability to:

     o    enhance our existing services;
     o    develop new services and technology that address the increasingly
          sophisticated  and varied needs of our target markets; and
     o    respond to technological advances and emerging industry standards and
          practices on a cost-effective and timely basis.

     We cannot be certain of our success in accomplishing the foregoing. If we
are unable, for technical, legal, financial or other reasons, to adapt to
changing market conditions or buyer requirements, our market share could be
materially adversely affected.

We may become exposed to product liability claims, which could result in
substantial costs and liability.

     The sale of scientific products involves the risk of product liability
claims. We face potential liability for claims based on the type and adequacy of
the information and data that suppliers publish on our Web sites as well as the
nature of the products that are sold through our Web sites, including claims for
breach of warranty, product liability, misrepresentation, violation of
governmental regulations and other commercial claims. Although we maintain
general liability insurance and product liability insurance, our insurance may
not cover some claims and may not be adequate to fully indemnify us for
liabilities that may be imposed. A product liability claim against us, if
successful, could result in a significant liability that would have a material
adverse effect on our liquidity and capital resources. In addition, even the
successful defense of a product liability claim could result in substantial
costs and diversion of our management's efforts.

We will be liable for any third party claims that may rise against EMAX
including claims related to important proprietary rights regarding EMAX's
technology. These claims could adversely affect our business.

     In our acquisition of EMAX, we have acquired important proprietary rights
that are embodied in its software technology. This software technology is not
patented and existing copyright laws offer only limited practical protection. By
virtue of this acquisition, we will be liable for any valid third-party claims
that may arise against EMAX in relation to their proprietary rights or contracts
with suppliers and customers. While we have investigated

                                       30
<PAGE>

EMAX's proprietary rights and business practices, we cannot be certain that
ownership, infringement or other claims will not arise against EMAX. A
successful claim by a third-party could result in significant liability on our
part and could materially and adversely affect the value of the technology that
we are acquiring. As a precaution, a portion of the purchase price for EMAX has
been deposited into an escrow fund. If we become liable for any claims against
EMAX, we may be entitled to compensation from this escrow fund. However, this
escrow fund will terminate after two years and may not be sufficient to
adequately compensate us for any claims that do arise.

If we are not able to offer new services, we may not be able to maintain revenue
growth.

     We plan to introduce new and expanded services and to expand our
third-party relationships in order to attract more buyers and suppliers to our
Web sites and increase transaction volume. We cannot be certain that we will be
able to offer these services in a cost-effective or timely manner. Any new
services that are not favorably received by buyers or suppliers could damage our
reputation or brand name. Expansion of our services will require us to devote a
significant amount of time and money and may strain our management, financial
and operating resources. The failure to generate profits from our expanded
services could have a material adverse effect on our earnings.

The content of our Web sites may expose us to various claims, which could result
in substantial costs and liabilities.

     Our Web sites contain information concerning the products offered by
suppliers, including product descriptions, specifications and pricing. This
information is provided by suppliers and we generally do not independently
verify this information. As a result, we could potentially face liability for
fraud, negligence, copyright, patent or trademark infringement and other claims
based on the information contained on our Web sites. A successful claim could
subject us to significant liability that would have a material adverse effect on
our liquidity and capital resources. In addition, even the successful defense of
a claim could result in substantial costs and division of our management's
efforts and damage to our brand perception by our customers.

If we are unable to protect our intellectual property rights, our business could
be materially and adversely affected.

     Our software technology is not patented and existing copyright laws offer
only limited practical protection. We cannot guarantee that the legal
protections that we rely on will be adequate to prevent misappropriation of our
technology. Also, these protections do not prevent independent third-party
development of competitive products or services. Failure to protect against the
misappropriation of our intellectual property could have a material adverse
effect on our business operations.

We are dependent on proprietary technology licensed from third parties, the loss
of which could be costly.

     We license a portion of the content for our online services from third
parties. Additionally, we intend to license a significant portion of our
transaction fulfillment systems from third parties. These third-party content
licenses may not be available to us on favorable terms, or at all, in the
future. In addition, we must be able to successfully integrate this content in a
timely and cost-effective manner to create an effective finished product. If we
fail to obtain necessary content on favorable terms or are unable to
successfully integrate this content or if we are unable to continue to license
our order fulfillment transaction systems on favorable terms, it could have a
material adverse effect on our business operations.

Our products, trademarks and other proprietary rights may infringe on the
proprietary rights of third parties, which may expose us to litigation.

     While we believe that our products, trademarks and other proprietary rights
do not infringe upon the proprietary rights of third parties, we cannot provide
any guarantees about the third-party products that are sold on our Web sites or
guarantee that third parties will not assert infringement claims against us in
the future or that any such assertion will not require us to enter into a
license agreement or royalty agreement with the party asserting a claim. If the
third-party products sold on our Web sites infringe the proprietary rights of
third parties, we may be deemed to infringe those rights by selling such
products. Even the successful defense of an infringement claim could result in
substantial costs and diversion of our management's efforts.


                                       31

<PAGE>

The failure to integrate successfully businesses that we have acquired or may
acquire could adversely affect our business.

      We have acquired and intend to continue to acquire complementary
businesses. In particular, we acquired BioSupplyNet, Inc. in 1998, Internet
Auctioneers International, Inc. in 1999, and SciCentral, Inc., Intralogix, Inc.
and EMAX in 2000. An element of our strategy is to broaden the scope and content
of our products and services through the acquisition of existing products,
technologies, services and businesses. Acquisitions entail numerous risks,
including:

     o    the integration of new operations, products, services and personnel;
     o    the diversion of resources from our existing businesses, sites and
          technologies;
     o    the  inability  to generate  revenues  from new products and services
          sufficient to offset associated acquisition costs;
     o    the maintenance of uniform standards, controls, procedures and
          policies;
     o    accounting effects that may adversely affect our financial results;
     o    the impairment of employee and customer relations as a result of any
          integration of new management personnel;
     o    dilution to existing stockholders from the issuance of equity
          securities; and
     o    liabilities or other problems associated with an acquired business.

     We may have difficulty in effectively assimilating and integrating these,
or any future joint ventures, acquisitions or alliances, into our operations.
Any difficulties in the process could disrupt our ongoing business, distract our
management and employees, increase our expenses and otherwise adversely effect
our business. Any problems we encounter in connection with our acquisitions
could have a material adverse effect on our business.

Our planned international expansion will require significant financial resources
and management attention and could have a negative effect on our earnings.

     We intend to invest resources and capital to expand internationally,
particularly in Europe. As a result, we may need to establish international
operations, hire additional personnel and establish relationships with
additional suppliers and customers. This expansion will require significant
financial resources and management attention and could have a negative effect on
our earnings. We cannot assure you that we will be successful in creating
international demand for our e-commerce solutions and services. In addition, our
international business may be subject to a variety of risks, including, among
other things, increased costs associated with maintaining international
marketing efforts, applicable government regulation, fluctuations in foreign
currency, difficulties in collecting international accounts receivable and the
enforcement of intellectual property rights. We cannot assure you that these
factors will not have an adverse effect on future international sales and
earnings. In addition, the business customs and regulations in foreign countries
may require changes in our business model. For instance, in Europe we will not
take title to products that are sold through our marketplace. As a result, we
will earn revenue in the form of commissions to be received from our suppliers.
This will result in lower gross revenues from these transactions as compared to
our domestic transactions, yet will have the same impact on our gross profits.
In addition, we are currently contemplating registering our trademarks in other
countries. We cannot assure you that we will be able to do so.

                                       32
<PAGE>

We rely on our suppliers and carriers in complying with government regulations
regarding the sale and distribution of regulated products, and their failure to
so comply could result in substantial civil and criminal liability.

     Many of the products offered through our Web sites are subject to direct
regulation by governmental agencies, which includes numerous laws and
regulations generally applicable to the chemical, pharmaceutical, controlled
substances, human and biological reagents, nuclear chemical businesses, and
environmental spills. Because of our presence in the distribution chain, we may
be subject to significant liability for violations of these regulations
regardless of our actual involvement in a violation. We could be fined or
exposed to civil or criminal liability, including monetary fines and injunctions
for any violations. We have historically relied, and will in the future rely,
upon our suppliers to meet all packaging, distribution, labeling, hazard and
health information notices to purchasers, record keeping and licensing
requirements applicable to transactions conducted through our system. In
addition, we rely upon our carriers to comply with regulations regarding the
shipment of hazardous materials sold through our system. We cannot assure you
that our suppliers and carriers will comply with all applicable government
regulations.

Significant fluctuation in the market price of our common stock could result in
securities class action claims against us.

     Significant price and value fluctuations have occurred with respect to the
securities of Internet-related companies. Our common stock price has been
volatile and is likely to be volatile in the future. In the past, following
periods of downward volatility in the market price of a company's securities,
class action litigation has often been pursued against such companies. If
similar litigation were pursued against us, it could result in substantial costs
and a diversion of our management's attention and resources.

Our future revenue growth would be adversely affected by a reduction in spending
in the scientific products industry.

     We derive substantially all of our revenue from the scientific products
industry. We expect our future growth to depend on spending levels in this
industry. Any reduction in spending in the scientific products industry would
have a material adverse effect on our revenues.

Unless Web-based purchasing achieves widespread acceptance, we will have
difficulty achieving revenue growth.

     Use of the Internet to purchase products, particularly in the scientific
products market, is at an early stage of development. Convincing buyers to
purchase scientific products online may be particularly difficult as such buyers
have traditionally relied on distributors of scientific products and mail order
catalogs to purchase their scientific products. If the use of e-commerce
services does not grow in the future, our Web site traffic and resulting revenue
could be materially and adversely affected.

     The continued growth of e-commerce services is dependent upon a number of
factors that are beyond our control, including the following:

     o    continued growth in the number of buyers who use e-commerce services;
     o    continued development of transaction security technology;
     o    continued development of e-commerce technology;
     o    continued development and successful implementation of enterprise
          software solutions;
     o    emergence of standard and common nomenclature and methodology for
          e-commerce; and
     o    development of complementary services and products.

                                       33
<PAGE>

The online scientific products market is highly competitive, which makes
achieving market share and profitability more difficult.

     The online scientific products market is new, rapidly evolving and
intensely competitive. Our primary competition includes e-commerce providers,
online scientific communities and suppliers' e-commerce initiatives. Competition
is likely to intensify as this market matures.

     As competitive conditions intensify, competitors may:

     o    enter into strategic or commercial relationships with larger, more
          established and well-financed companies;
     o    secure services and products from suppliers on more favorable terms;
     o    devote greater resources to marketing and promotional campaigns;
     o    secure exclusive deals with buyers that impede our sales; and
     o    devote substantially more resources to Web site and systems
          development.

     In addition, new technologies and the expansion of existing technologies
may increase competitive pressures. As a result of increased competition, we may
experience reduced operating margins, as well as loss of market share and brand
recognition. We may not be able to compete successfully against current and
future competitors. These competitive pressures could have a material adverse
effect on our revenue growth and earnings.

Online commerce and database security concerns could adversely affect traffic on
our Web sites and our revenues.

     The secure transmission of confidential information over public networks is
a fundamental requirement for online commerce. Concerns over the security of
transactions and commercial online services and other privacy issues may also
inhibit the growth of the Internet and the online commerce industry. We license
encryption and authentication technology for the transmission of confidential
information, such as buyer credit card numbers, through our online system. In
addition, we maintain an extensive confidential database of buyer profiles and
transaction information. Technological advances, including new discoveries in
the field of cryptography, could result in a compromise or breach of our
security systems. Security breaches could have a material adverse effect on our
reputation, financial condition and results of operations. An intruder who
breaches our security measures could misappropriate proprietary information or
cause interruptions in our operations. We could be required to spend a
significant amount of time and money to protect against security breaches or to
alleviate problems caused by such breaches. Security breaches could also expose
us to a risk of loss or litigation and possible liability. We cannot be certain
that our security measures will prevent security breaches.

Additional regulation of online commerce could adversely affect demand for our
products and services.

     There are currently few laws and regulations directly applicable to the
Internet and e-commerce services. However, we expect that additional regulation
may be adopted covering issues such as user privacy, pricing, content,
copyrights, distribution, antitrust and characteristics and quality of products
and services. In addition, the growth and development of e-commerce may prompt
calls for more stringent buyer protection laws that may impose additional
burdens on those companies conducting business online. The adoption of any
additional laws or regulations may decrease the growth of the Internet or
commercial online services, which could, in turn, decrease the demand for our
products and services. Additional regulation could also increase our cost of
doing business.

The application of sales and other taxes to online commerce could adversely
affect demand for our products and services and are administratively burdensome.

     The application of sales and other taxes by state and local governments to
online commerce is uncertain and may take years to resolve. In particular, the
federal government and a number of states are currently reviewing the


                                       34

<PAGE>

appropriate tax treatment of online commerce, and new federal laws or state tax
regulations may subject us and/or the suppliers and buyers that use our Web
sites to additional state sales and income taxes. The imposition of additional
sales taxes on transactions conducted through our Web sites could make this
service less valuable to buyers and adversely impact transaction volume. The
imposition of any such taxes or other regulations could have a material adverse
effect on our revenues and earnings. In addition, the collection and payment of
such taxes may cause us to incur significant administrative effort and expense.
Our failure to properly collect and pay such taxes in any jurisdiction could
subject us to penalties that could adversely affect our earnings.

New accounting rules could be proposed that could adversely affect our reported
financial results.

     Our financial statements are prepared based on generally accepted
accounting principles and SEC accounting rules. These principles and rules are
subject to change from time to time for various reasons. While we believe we
meet all current financial reporting requirements, we cannot predict at this
time whether any initiatives will be proposed or adopted that would require us
to change our accounting policies. Any change to generally accepted accounting
principles or SEC rules could adversely affect our reported financial results.

ITEM 3.   Quantitative and Qualitative Disclosures About Market Risk

     Most of our cash equivalents, short-term and long-term investments and
capital lease obligations are at fixed interest rates, therefore the fair value
of these investments is affected by changes in market interest rates. However,
because our investment portfolio is primarily comprised of investments in U.S.
Government obligations and high-grade commercial paper, an immediate 10% change
in market interest rates would not have a material effect on the fair market
value of our portfolio. Therefore, we would not expect our operating results or
cash flows to be affected to any significant degree by the effect of a sudden
change in market interest rates on our investment portfolio.


                                       35
<PAGE>

                                     PART II

                                OTHER INFORMATION

Item 1.   Legal Proceedings.

     We are not a party to any material legal proceedings.


Item 2.   Changes in Securities.

     Not applicable.


Item 3.   Defaults In Securities.

     Not applicable.


Item 4.   Submission of Matters to a Vote of Security Holders.

     Not applicable


Item 5.   Other Information.

     Andrew J. McKenna retired as our President and as a director as of November
1, 2000.


                                       36
<PAGE>

Item 6.   Exhibits and Reports on Form 8-K.

     (a) The following exhibits are filed as a part of, or are incorporated by
reference into, this report on Form 10-Q:

<TABLE>
<CAPTION>
Exhibit
Number                                              Description
------                                              -----------
<S>          <C>
  3.1*       Amended and Restated Certificate of Incorporation of SciQuest.com.

  3.2*       Amended and Restated Bylaws of SciQuest.com.

  4.1*       See Exhibits 3.1 and 3.2 for provisions of the Amended and Restated
             Certificate of Incorporation and Amended and Restated Bylaws of
             SciQuest.com defining rights of the holders of Common Stock of
             SciQuest.com.

  4.2*       Specimen Stock Certificate.

  10.1*      SciQuest.com, Inc. Stock Option Plan dated as of September 4, 1997.

  10.2*      Amendment No. 1 to SciQuest.com, Inc. Stock Option Plan dated as of September 11, 1998.

  10.3*      Amendment No. 2 to SciQuest.com, Inc. Stock Option Plan dated as of February 26, 1999.

  10.4*      Amendment No. 3 to SciQuest.com, Inc. Stock Option Plan dated as of March 1, 1999.

  10.5*      Amendment No. 4 to SciQuest.com, Inc. Stock Option Plan dated as of August 27, 1999.

  10.6*      Agreement of Sublease by and between Inspire Pharmaceuticals, Inc. and SciQuest.com dated July 31,
             1998.

  10.7*      Sublease Agreement by and between Applied Innovation, Inc. and SciQuest.com dated March 11,
             1999.

  10.9*      Master Lease Agreement by and between Comdisco, Inc. and SciQuest.com dated May 21, 1999, as
             amended.

  10.10*     Stock Restriction Agreement by and between SciQuest.com and Antony Francis dated March 1, 1999.

  10.11*     Registration Rights Agreement by and among SciQuest.com and the
             purchasers of Class B Common Stock and the purchasers of Series A
             Preferred Stock dated October 17, 1997, as amended.

  10.12*     Registration Rights Agreement by and among SciQuest.com and the
             purchasers of Series C Preferred Stock dated September 29, 1998.

  10.13*     Registration Rights Agreement by and among SciQuest.com and Antony Francis dated March 1,
             1999.

  10.14*     Registration Rights Agreement by and among SciQuest.com, the
             holders of Series B Preferred Stock and the purchasers of Series D
             Preferred Stock dated May 18, 1999, as amended.

  10.15*     Registration Rights Agreement by and among SciQuest.com and the
             holders of Series E Preferred Stock dated July 27, 1999.

  10.16*     Merger Agreement by and among SciQuest.com, SciQuest Merger Subsidiary, Inc., Internet
             Auctioneers International, Inc. and Mark Atlas dated July 27, 1999.

  10.17*     Merger Agreement by and among SciQuest.com, SciQuest Acquisition, Inc. and BioSupplyNet, Inc.
             dated September 29, 1998.

  10.18*     Lease Agreement by and between Duke-Weeks Realty Limited
             Partnership and SciQuest.com dated as of October 19, 1999.


                                       37
<PAGE>



Exhibit
Number                                              Description
-------                                             --------------
<S>          <C>

10.19*       Content Conversion Services Agreement by and between SciQuest.com and Requisite Technology,
             Inc. dated December 18, 1998.

10.20**      Form of Strategic Alliance Plus Agreement.

10.21**      Form of Strategic Purchasing Agreement.

10.22**      Registration Rights Agreement by and among SciQuest.com and the former holders of Intralogix,
             Inc. stock dated January 14, 2000.

10.23*       Amendment No. 5 to SciQuest.com, Inc. Stock Option Plan.

10.24*       SciQuest.com, Inc. 1999 Stock Incentive Plan dated as of October 12, 1999.

10.25**      First Amendment to 1999 Stock Incentive Plan.

10.26**      Merger Agreement by and among SciQuest.com, Lujack Subsidiary, Inc., Intralogix, Inc., Mary T.
             Romac, Timothy M. Brady and Dale L. Young dated January 14, 2000.

10.27**      Merger Agreement by and among SciQuest.com, SciCentral Acquisition Subsidiary, Inc.,
             SciCentral.com, Inc. and the shareholders of SciCentral.com, Inc. dated February 2, 2000.

10.28**      Registration Rights Agreement by and among SciQuest.com and the former holders of SciCentral,
             Inc. stock dated February 2, 2000.

10.29**      Agreement and Plan of Merger and Reorganization between SciQuest.com, ESP Acquisition, Inc. and
             EMAX Solution Partners, Inc. dated March 13, 2000.

10.30**      Registration Rights Agreement by and among SciQuest.com and the former holders of EMAX
             Solution Partners, Inc. dated March 13, 2000.

10.31        SciQuest.com, Inc. 2000 Employee Stock Purchase Plan.

27.1         Financial Data Schedule.

</TABLE>

------------
  *  Incorporated by reference to SciQuest.com's Registration Statement on Form
     S-1 (Reg. No. 333-87433).
**   Incorporated by reference to SciQuest.com's Registration Statement on Form
     S-1 (Reg. No. 333-32582).


     (b) Reports on Form 8-K.

     None.


                                       38
<PAGE>



                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                        SCIQUEST.COM, INC.

Date: November 14, 2000                 /s/ M. SCOTT ANDREWS
                                       ----------------------------------------
                                            M. Scott Andrews
                                       Chairman of the Board and Chief
                                          Executive Officer


Date: November 14, 2000                /s/ JAMES J. SCHEUER
                                       ----------------------------------------
                                           James J. Scheuer
                                       Chief Financial Officer
                                       (Principal Financial and Accounting
                                          Officer)


                                       39