Tag Archives: Colorado

About 3186 days ago Computer Security

Five Ideas to Watch

The Hooters of Hair Care Bikini Cuts, a hair salon in Sandy, Utah, is changing the way men view their barber. Following a strategy that recalls a certain chicken wing chain, the shop’s (very male) clientele can look forward to a clip or trim from (very female) stylists who are clad only in bikinis. Despite criticism from city officials and some local residents, owner Bethany Prince has said the shop simply celebrates “summer all year round,” and that she has plans to open a second location soon. Clients can also watch sports on a flat screen TV or get a chair massage while waiting for their appointment. Labels Learn a New Language In yet another indication of the growing respect marketers have for Hispanic consumers, several California wine producers have begun distributing Spanish-label bottles. Beringer Blass Vineyards now ships cases of white Zinfandel bearing Spanish labels to Texas, Arizona, and California. Those states account for nearly a quarter of the company’s sales, says Beringer marketing director Sharon Goldman. A Black Box for Ambulances A concept common to air travel is gaining traction on highways. American Medical Response, the Colorado-based ambulance giant, is installing devices in roughly half of its 3,200 vehicles. AMR’s recently retooled box sounds an alarm when a driver speeds or rounds a corner recklessly. After 10 seconds, if the driving doesn’t improve, a second alarm sounds and the box records the incident. Now, a California company called Road Safety International has begun marketing black boxes to the parents of teen drivers. Put an iPod in the Jukebox, Baby Ecast’s MP3-playing digital jukeboxes now raise the roof at some 3,000 bars, and the San Francisco firm is deploying 150 new consoles every month. For $1, you can choose a song from 300 albums programmed on a local hard drive, or for $2, you can pick a tune from 11,000 albums hosted on corporate servers. Ecast’s quick success is due in part to record labels looking to make money from digital distribution. Replacing Passwords With Pictures A new password encryption program replaces letters and numbers with pictures of hearts and dogs. Images scroll on the screen of a PDA or laptop as they might on a slot machine. From a grid of mixed pictures, users select their sequence by tapping the screen or keypad ATM-style. Developer PointSec Mobile Technologies of Mokena, Ill., says the passwords are harder to hack.

About 3248 days ago PCs, Laptops, and Notebooks

Is My Partnership Fair?

My partner and I are 50-50 shareholders in a start-up. I am the business builder, marketer, and president; he is putting up the money. I am worried about how I will feel when we begin making enormous amounts of money. Is it fair that he is a 50% shareholder if I am doing all of the work? Name withheld You have sweat on your brow, but your partner has skin in the game. It’s his capital that’s at risk. He is entitled to returns — ideally many happy ones. Still, smart partners routinely reassess their relationships. If you suspect yours stinks, by all means renegotiate — though you may want to wait until your company is up and running and raking in the vast sums of cash you so optimistically envision. “The financing partner should get a return on his initial investment,” says executive compensation expert Greg Keshishian. “But if your efforts are driving the business, you should share in a larger portion of the benefits.” One option is to set a revenue goal after which the harder-working partner gains share. That’s how things work at Warm Spirit, a maker of lotions, candles, fragrances, and herbal remedies based in Exeter, N.H. Daniel Wolf, the outfit’s pockets, keeps all profits up to $5 million — the amount of his initial investment. After that, he’ll split even-steven with CEO Nadine Thompson. Thompson’s okay with that arrangement — at least for now. As for the future, “His goal is to have me be richer than him,” she says. Protecting an Invention I’ve come up with two products that people need but that do not yet exist. They don’t consist of new technology, so I don’t think I can get a patent, nor do I have money to build them myself. What are the risks of taking my ideas to a large corporation? Cliff Choury, Fort Collins, Colo. Corporations view unprotected ideas the way bars view drunken drivers: as lawsuits waiting to happen. With no patent or pending application, it’s unlikely that any major company will look at your idea. After all, inventors need nondisclosure agreements before tipping their hands, and that leaves companies vulnerable if it turns out they’re working on the same one-in-a-million product idea. A lock, in other words, is key. Fortunately, the U.S. Patent Office smiles on even the simplest inventions. Case in point: U.S. Patent No. 6,004,596, awarded to the creator of a “sealed crustless sandwich.” Check the agency’s website (www.uspto.gov) for a list of registered patent attorneys and a patent database. The American Intellectual Property Law Association (www.aipla.org) also publishes a useful online document, “How to Protect and Benefit From Your Ideas.” Rent or Own? We are upgrading our computers and are wondering whether to lease or buy. It used to be that lease payments were attractive for write-off purposes, but with the new depreciation rules for capital investments, what is more worthwhile? Rachael Dalton-Taggart, Strategic Reach PR, Denver When it comes to purchasing new gear, the tax code lays its thumb lightly on the scale: A new expensing allowance lets businesses write off up to $102,000 of tech equipment purchased before the end of 2004. But leasing has charms of its own, says Joe Marchbein, a tax manager at Huber, Ring, Helm & Co. in St. Louis. Specifically, leased business equipment returned at contract’s end is 100% tax deductible. And leasing agents are often more generous than banks with credit and payment terms. But back on the buy side: Leasing agents’ rates are higher than those at banks. They don’t always replace stuff that breaks. They may slap on heavy fines if you don’t return every last cable in good condition. And you do have to return things, you know. How much your equipment is taxed matters. But so does how much you tax your equipment. Ask yourself this: Is the technology needed for a limited time, after which it’s destined for life as a doorstop? In that case, lease is the word, says John Sheaffer, CEO of Sysix, an IT consultancy in Oak Brook, Ill. Or do you expect to use the hardware on a daily basis for years? Then buy it new or buy it used. But by all means, buy it. Stumped by a thorny business problem? Let Inc. help. Send your questions to AskInc@inc.com. We’ll consult with experienced entrepreneurs and savvy advisers, folks who’ve been where you are and figured out what works and what doesn’t. If you don’t like what we have to say — well, you can tell us that, too.

About 3339 days ago Telecom and Wireless

Meetings Go Virtual

Success in the global market was giving Marla Landreth headaches. Her company, InfoGenesis in Santa Barbara, Calif., was doing well. Customers as far away as Australia and Asia were buying its systems that link sales terminals together to track sales, inventory and customers across large properties such as resorts, casinos and stadiums. But each sale was an added challenge for Landreth, who heads training for the company, which has 150 employees and 17 sites. Most customers had steady employee turnover and a constant need to train new hires on InfoGenesis’ systems. Add to that the quarterly updates of new bells and whistles to the company’s software and Landreth faced big budget hits for training and travel. The dilemma grew as many clients cut their own travel following 9/11 and the economic downturn. “We use to distribute documentation and have everyone call in with questions, but that didn’t address the needs,” Landreth says. So InfoGenesis tried Web conferencing through Centra Software Inc., in Lexington, Mass. By setting up training sessions over the Internet, trainees several time zones away can click a link on their computers and enter a virtual classroom with a simulation of the InfoGenesis system and real-time instructions from a trainer. Students see what the software looks like in action. They can interrupt the lesson with questions using text chat or voice-over-Internet protocol (VoIP) technology, which lets them make long-distance telephone calls over the Internet rather than over telephone wires. The online solution, Landreth says, “has solved a huge problem of training and turnover for our customers.” Once the province of larger firms, Web conferencing and other collaboration technologies — tools that help people work with one another through their computers — have become more available and affordable. This is a boon for smaller companies whose only previous collaboration option was to gather workers in a room with coffee, donuts, and a whiteboard. Simple collaborative tools such as instant messaging (IM) can be incorporated into company systems, and even on individual employees’ home computers, courtesy of the AOLs and Yahoos of the world. Calendaring — the ability to check colleagues’ schedules or add a meeting their calendar — is now a standard feature in Microsoft Outlook. Web conferencing is being bundled into operating systems sold by companies like Microsoft Corp. and IBM Corp. Such systems will soon or already offer teamware — software that creates virtual workspaces for project groups inside or outside a company. The choices don’t end there. The marketplace teems with companies challenging larger companies like Microsoft and WebEx Communications Inc., a hosted Web-meeting provider based in San Jose. Flypaper.com, a San Carlos, Calif., firm hosts secure digital workplaces where teams can gather and share information, and Co-create Software, an Hewlett-Packard spinoff in Fort Collins, Colo., makes software that lets engineering and manufacturing teams work together. You can even buy turnkey systems, with servers and software, for $40,000. All tolled, the collaborative market is now estimated at around $3 billion a year. “The field is really growing by leaps and bounds now, in part due to the whole history of 9/11 and SARS [last year's outbreak of severe acute respiratory syndrome that put a chill on international travel],” says Mark Rice, a former Xerox executive who saw the potential of collaborative technologies and started his own Web-meeting business called Webinar Resources in Florissant, Mo. With the flood of collaborative products available, how do you choose? The best advice is to think hard about what you need and take it slow. “It’s hard to assess the values of these technologies,” says Erica Rugullies, a senior analyst at Forrester Research Inc. in Cambridge, Mass. “Some companies are afraid of collaboration because they see it as something that is just cool” rather than truly valuable, she says. “But there are advantages when you look at the business process, such as reduced phone bills or e-mail storage costs.” Web conferencing and teamware–software designed for groups and for communication, including e-mail, videoconferencing, chat features, and document collaboration–hold the biggest promise of savings in both money and time. Coworkers, clients, or prospective customers in different locations can look at documents and images on their computers while talking on traditional teleconference lines or directly over the Internet via VoIP. There are several ways to go. You can contract with the main players, like Microsoft’s Live Meeting, WebEX or IBM, which put together larger, more expensive Web conferences. You can also try going solo: Microsoft has bundled Net Meeting into all its new Windows products. Click the icon of the globe with the two arrows and you can try your hand at conferencing with up to 10 people. The third route is to sign up with a smaller conferencing firm such as Centra, which can take the mystery out of Web conferencing, especially for companies with small or nonexistent IT departments. For a fee of around 20 cents per participant per minute, Centra will set up your Internet meeting place, send out invitations, and register participants. All you have to do is click on the site, hook up a computer headset, and log into the meeting. (Centra also provides a Cost/Benefit Analysis, which shows the cost savings involved with online learning initiatives.) Going the third-party route may make the most sense for newcomers, the experts say. As with any new venture, due diligence is a necessary first step. Talk to the conferencing companies, check out their websites, ask for reference lists of customers, or even sit in on a conference, which many hold to demonstrate product features. But if you discover that conferencing works for you, you begin to use it frequently, and you and/or your IT department is up to the task, you might consider purchasing the technology to do it yourself. Microsoft offers Office Live Communications Server 2003, which lets companies set up their own IM networks via Office applications. OpenScape from Siemens AG combines voice, e-mail, IM, and collaboration features. Apple Computer Inc. has added video to IM with its iChat AV software and iSight digital camera. Oracle Corp. is challenging Microsoft’s e-mail dominance with its own Collaboration Suite, which builds on Oracle’s already considerable collaborative capabilities. The overriding advice is to take your time, especially with your own staff. Shifting cultures from donuts and coffee to computer screens and headphones may be jarring at first. “With options like teamware you have to change habits,” says Mike Gotta, senior vice president and principal analyst at Meta Group Inc. of Stamford, Conn., an industry advisory firm. “Getting people to change can be tough. You have to convince them that new is better.”

About 3552 days ago PCs, Laptops, and Notebooks

Drives Provide New Electronics Avenue

Consumer electronics may get smaller and cheaper, thanks to a three-year-old company based in Longmont, Colo. Using inexpensive materials and cutting costs in the assembly process, Cornice Inc. has designed circuitry that can fit 1.5 gigabytes of storage onto a one-inch square that sells for about $70. Its drives hold 15,000 MP3 songs — more storage than IBM’s Microdrive at about 40% of the cost. Analysts say they are ideal for hybrid devices — think a cell phone-MP3 player-camera all in one. They also buzz about their potential for a TiVo-inspired car MP3 radio. Currently, dashboards are too crowded for additional circuitry; they could accommodate Cornice’s wee drives, however, enabling car owners to store music files and download radio broadcasts. So far, the company, which partners with Texas Instruments, has deals to put drives in 10 MP3 players (including the RCA LYRA Micro Jukebox and the Rio Eigen Executive) and a Samsung video camera. GPS devices will follow. “You could fit an entire continent on one inch,” says Cornice CEO Kevin Magenis. For the drives to truly succeed, however, they must challenge the dominance of flash memory, a digital storage technology that takes up the same amount of space. But by being considerably cheaper and suitable for brave new gadgets, Cornice drives should find an opening.

About 3979 days ago Telecom and Wireless

IM Is Here. RU Ready 2 Try It?

Special Technology Report In the late 1980s, Rhonda Sanderson happily moved her tiny public-relations agency from downtown Chicago to suburban Highland Park. The move cut her commute from 30 minutes to about 30 seconds: she’d set up shop in an office building across the street from her home. But a decade later, Sanderson & Associates Ltd. was growing, and Sanderson found that the top job candidates — recent college grads — viewed her location as a distinct drawback. Having just escaped from smallish midwestern college communities, they weren’t interested in launching their careers somewhere even smaller. “They wanted to live and work in the big city,” says Sanderson. Sanderson, a single parent, didn’t want to uproot her high school-age daughter to move back downtown. Instead, she bought a small building in a trendy Chicago neighborhood and moved several of her employees there. After she had satisfied everyone’s lifestyle demands, Sanderson had just one nagging concern: how would she, the suburban CEO who schlepped into the city just two days a week, stay in the loop the rest of the time? “I thought, ‘Will I have to call them every single minute?’ ” she says. As it turns out, Sanderson does talk with her seven staffers dozens of times daily — but without picking up the phone. Instead they chat live on-line, using a free instant-messaging (IM) program installed by an employee. Today “it’s fair to say we run the whole business on IM,” says Sanderson, whose company, with revenues in excess of $1 million, specializes in representing national franchises such as Meineke Discount Mufflers and Back Yard Burgers. “Every [internal] communication is by IM. Everything. This arrangement wouldn’t have worked without it.” There’s no playing phone tag, no wondering whether somebody got that urgent E-mail message, no delaying a response to a crisis. Sanderson is never more than a few keystrokes from her Chicago employees — as long as everyone is near a computer. “I feel much more secure handling my office this way,” she says of the constant real-time contact. “I feel the need to be connected to them.” CEOs nationwide are discovering what teenagers and twentysomethings, including Sanderson’s daughter and staffers, have known for years: IM is an addictively fast, simple, and cheap way to communicate. There’s nothing exotic about the technology. It’s basically real-time E-mail, either in-house or over the Internet. But unlike E-mail, IM is, well, instantaneous; as soon as the message writer hits “send,” the message pops up on the receiver’s screen. And unlike E-mail, IM doesn’t generate in-box clutter. Conversations usually vanish when they’re finished (although programs increasingly allow one to save them), and users, because they control their lists of authorized contacts, are less likely to receive “spam,” or unsolicited messages. The best-known IM programs are free; even commercial products are relatively cheap. Although an IM conversation typically involves just two people, power users may conduct several conversations simultaneously or create a chat room where any number of users can join the discussion. With some programs, users can even swap graphics, video clips, or voice clips. And unlike any other form of communication, IM monitors physical presence. With a glance at their contact lists, users can tell who’s logged on and available right now. Even though IM began as a way for kids to pass notes electronically (see “The IM Generation,” below), it’s clearly becoming a vital tool in businesses. IDC, a research company based in Framingham, Mass., says that about 40% of U.S. companies already use the technology. Jupiter Media Metrix, headquartered in New York City, says nearly 17 million Americans used the largest free IM services at work in March 2002, up from 10 million in September 2000. Gartner Inc., in Stamford, Conn., calls IM “the sleeping giant of the Internet” and predicts that by next year employees at 70% of all companies will use IM for business or personal communication. By 2005, Gartner says, at least 50% of U.S. businesses will rely on IM to interact with customers — and most consumers will use IM more frequently than they use E-mail. Naturally, IM works best in businesses in which employees are tethered to computers. Large high-tech and telecom companies like IBM and AT&T have used the technology for years. But it’s picking up speed in less likely industries. For instance, manufacturers are beginning to use IM kiosks in factories to keep managers in close contact with floor supervisors. Retailers that have been using live chat on their Web sites for the past few years are beginning to use it in-house as well. Jennifer Convertibles in Woodbury, N.Y., uses IM to communicate with managers in its 200-plus stores nationwide. Rami Abada, the chain’s president and chief financial officer, says the low-cost IM network, which replaced a costly voice-mail system, has saved the company $50,000 to $60,000 a year and eliminated 7,000 calls a week that were going into voice mail. Now smaller companies, too, are getting the message that IM is free or cheap, requires no special hardware and no training, and can even be kind of fun. (See “Instant Lingo,” below.) And despite some of IM’s drawbacks — such as legitimate concerns about security and productivity — they’re finding plenty of ways to use it. For many growing companies, IM’s main appeal is simply being able to reach anybody instantly — even when both parties are already busy. Being there: In the Chicago office of Sanderson & Associates on a hectic Friday morning in April, Kelly Templer was on the phone with a reporter. She checked her contact list to be sure Sanderson was on-line. She was. Templer opened her IM on-screen window and typed in: “I have a reporter from AP on the phone. I want him to interview Tommy about IFE [a franchise trade show], he also wants other franchise info — what should I do?” She hit “send,” and Sanderson, on another call in the Highland Park office, saw the message pop up. Sanderson immediately shot back: “Give it to him! Offer him interview with Don DeBolt or some other expert if he wants independent source. Try to get info on exhibitors to him.” Neither had skipped a beat on their respective phone calls. Bolstering virtual management: At Tax Technologies Inc., a two-year-old tax-preparation and software company, vice-president Jeff Wenger, who’s based in Bradenton, Fla., uses IM to manage a team of software developers and testers scattered all over the United States. Because all IM programs indicate which users are logged on, Wenger can tell, for instance, when developer Anar Patel, in Warren, Ohio, is available and when Adrienne Morey, in Phoenix, is on-line. (Team members can, and do, converse with one another by IM all day — and sometimes all night — about work in progress.) Wenger says the setup allows him to hire top employees who can work and live wherever they want, “whether it’s the mountains of Colorado, the beaches of Florida, or the big city.” Using IM has cut his daily telephone time from three hours to less than 30 minutes. Other organizations rely on IM to stay in touch with telecommuters, road warriors, or local field staff. Companies that have overseas employees, partners, or customers may find the technology particularly cost-effective. Managing crises: AtomicPR, a $1.9-million San Francisco high-tech PR agency that was launched in late 1999, just before the dot-com bubble burst, built real-time communications into its business model and culture. The company’s 15 employees say that IM provides them with a competitive advantage in a tough economy. Today the business uses IM for both in-house and client communications, and the staffers have found it invaluable for responding rapidly to a crisis. In one case, account supervisor Mike Crusick contacted company cofounder Andy Getsey by IM at 7 a.m. on a weekday, when both were still at home, to report some bad news: a press release had just come over the wire that a client was being sued by a competitor. Andy to Mike: Wow. I’ll do a quick plan for [client], then give her a call. It’d be best to have recent real-world examples too. Can you find a few similar suits and corporate responses ASAP? Thx. Mike: Here are links to announcements/responses in similar suit. Andy: Thx. Can you find 2 more from different suits, too? Hurry. Andy: PS. Would you call the rest of your team and let them know what’s happening ASAP? Andy: PSS. And tell team to hold on related media communications until we talk to [client]. Mike: Of course. Mike: More links to difft suits. Andy: Check Andy: Just emailed [client] 5 point plan. CC’d you and team. Calling her now. Mike: Roger that. Andy: Just talked with [client]. Buzzing there! Went over the key points and examples. She’s going into internal meeting at 9 — will call us immediately after. Thx for help. I’ll be at office in an hour or so. Mike: Great. I’m headed into the office now. See you there. Busy morning already Instant inventory tracking: At Pacific International Marketing, a produce-trading company in Salinas, Calif., with revenues under $100 million, sales managers use IM to simultaneously alert 35 salespeople in five cities to market changes. A typical message: “Stop selling broccoli at $7; it’s dropped to $6.” That’s a big improvement over the decidedly low-tech tradition of simply yelling across the room to local traders and then calling around to remote offices to spread the news. And, says president Tom Russell, the time savings is no small potatoes in his industry, where prices can fluctuate 100% in 24 hours and product shelf life is measured in days. As Russell puts it, “The minute we cut some product in the field, it’s beginning its journey to the Dumpster.” He estimates that IM has saved him thousands of dollars in phone calls — and an untold amount in losses caused by information delays. Kibitizing on transactions: One of IM’s most practical and widespread uses in small companies is allowing behind-the-scenes collaboration. At $22-million YellowPages.com, an on-line ad directory based in Henderson, Nev., the company’s 42 employees “ping,” or contact one another by IM, throughout the day. “My Chicago guy is pinging me right now,” Dennis Warren, senior vice-president of corporate development, says during a telephone interview. (His reply: “OTP. SB.” Translation: “On the phone. Stand by, I’ll get right back to you.”) But the technology’s real value, he says, is in letting salespeople get the answers they need. For instance, a rep who is trying to close a deal on the phone might use IM with Warren: “Can I offer her a 30% discount?” Warren can decide and reply on the spot (“Yes,” or “Try 15% first”) without making the employee — or the potential customer — wait. At StudentUniverse, a travel service in Watertown, Mass., that caters to college-age customers, agents often use IM to send questions to a manager, aiming to get an immediate response without putting the customer on hold. Customer-service director Phil Dobbyn credits IM for helping cut his staff’s average time per call by 25% in just a few months. Finacorp Securities, a bond brokerage in Newport Beach, Calif., with revenues under $5 million, uses IM for everything from telecommuting to providing tech support for its on-line arm, Tradebonds.com. But IM’s greatest value is linking salespeople to the firm’s compliance officers to get fast answers to regulatory questions. Some managers own up to swapping messages with one another during conference calls with outsiders. StudentUniverse CEO Espen Odegard occasionally uses IM to confer with his cofounder or his lawyer during sticky negotiations. Other executives cue each other during calls; in fact, AtomicPR senior account manager Misha Gulak used IM with Getsey during a phone interview with Inc, reminding Getsey about a point she thought he should make. Instant gratification, of course, comes with a price. For starters, IM, like E-mail, can transmit viruses that existing security software may not detect. (For that reason, security experts recommend using virus-scanning programs that specifically cover IM.) But because anybody can download free IM software from the Web, tech staffers may not even realize employees are using it. And IM isn’t always secure, as the CEO of a now-defunct California dot-com learned when he found copies of his private messages posted on the Web. In May, Microsoft warned that its popular free IM program, MSN Messenger, contained a serious security flaw that could leave users vulnerable to computer hackers. (The company provided a free on-line “patch” to fix the problem.) With that in mind, Tax Technologies instructs users not to transmit confidential client information. StudentUniverse’s messages include their own version of the surgeon general’s warning: “Never give out your password or credit-card number in an instant message conversation.” Obviously, any new link to the outside creates new opportunities to leak corporate secrets. For that reason, IM programs increasingly include monitoring functions that allow companies to capture or log transmissions. Many IM programs — particularly the free ones — won’t work with one another, meaning that if you have only Yahoo Messenger, you can’t use IM to communicate with a client who has only AOL Instant Messenger. That’s exactly why the American Homeowners Foundation, a publishing and lobbying organization based in Arlington, Va., stopped using IM last year. Initially, the foundation’s directors hoped to use the technology to quickly correspond with the far-flung authors who write the organization’s books. But they ultimately found IM more frustrating than useful, says vice-president Chris Christensen, citing the plethora of incompatible programs. Michael Osterman, an electronic-messaging consultant in Black Diamond, Wash., predicts that the industry will adopt a common standard within the next year or two. In addition, some people find the barrage of read-me-right-now messages annoying or disruptive. “Your attention gets very fragmented. It gets in the way of good solid thinking,” says Carl Stormer, StudentUniverse’s cofounder and executive vice-president. “It’s almost like white noise; you don’t notice it till it’s gone.” Other executives occasionally shut off IM or change their status to “busy” or “do not disturb.” Managers at some companies worry that employees will spend too much work time using IM to chat with pals inside and outside the company. Others — such as StudentUniverse’s Norwegian-born Odegard and Stormer, who use IM daily to correspond with their families in Norway — view it as a perk they can offer employees, as long as personal use doesn’t get out of control. They also emphasize that IM isn’t the right tool for every business missive; employees should still turn to E-mail when they need a record and to the phone for the personal touch. Finally, they acknowledge that IM sometimes provides solutions to problems that don’t exist. For instance, employees at StudentUniverse admit that they sometimes swap messages with nearby coworkers rather than step next door or down the hall. Stormer says, “That is like taking the elevator to the first floor.” Yet even critics recognize the technology’s promise. For example, ActiveBuddy, a New York City developer of IM products, offers free homework help, stock quotes, and sports scores; the company also created IM promotions for the band Radiohead, teen singer Lindsay Pagano, and the movie The Lord of the Rings. Other companies are exploring IM’s potential for real-time auctions, travel booking, technical support, and stock trading. Meanwhile, the earliest adopters remain true believers in the technology’s value. “Our development team is 5 to 10 times more productive in our virtual environment than in a traditional office setting,” says Tax Technologies’ Wenger. “It’s disruptive,” says Dane Madsen, CEO of YellowPages.com. “But so was the Internet and so was E-mail. You adjust.” Anne Stuart is a senior writer at Inc. Instant Lingo In instant-messaging culture, spelling and grammar matter less than trading messages at the speed of a championship tennis match. So fans of IM write in standard business shorthand: FYI, ASAP, OK, thx, cc. They also rely on those annoying acronyms that hard-core E-mailers have thrown around for years: BTW (by the way), LOL (laughing out loud), TTFN (ta-ta for now). But as if it weren’t telegraphic enough, business IM seems to be adapting its own code. Among the ones we found: BRB: Be right back. BTN/5: Be there in five (minutes); be right there. C&B or c/b: Crash and burn. Convo: Conversation. G2G: Got to go. IC: I see. JK or j/k: Just kidding. JW or j/w: Just wondering. NP or n/p: No problem. OTL: Out to lunch. OTP: On the phone. OTR: On the road. Ping: To send someone an instant message (“I’ll ping you later”). Pop: Ditto. SB: Stand by (as in “just a minute”). SN: Screen name, or on-line identity. TTYL: Talk to you later. The IM Generation Most youthful IM aficionados use the technology for exactly the reason you’d expect: to converse, instantly, with everybody they know. Simultaneously. “I have 11 windows open,” Jessica Nurnberg, 15, of Oklahoma City, typed during an interview using IM. Translation: As Nurnberg answered Inc‘s questions at lightning speed, she was chatting with 10 other friends, swapping messages on everything from homework to hot ninth-grade gossip. Other young IM fans cite more practical uses, such as: Passive promotion. Kevin Colleran, 21, wouldn’t dream of spamming his 200 IM buddies with ads for his on-line business, Clubvibes.com Boston, a nightclub directory. But Colleran, a Babson College senior who holds several national “young entrepreneur” titles, uses the Clubvibes logo in his buddy icon (the on-line ID badge that appears during IM sessions). That way, he raises brand awareness without raising hackles. Real-time brainstorming. For a sociology class, Marie Aschenbrenner, 18, of Penticton, British Columbia, was assigned to a debate team taking a “pro” stance on globalization. Team members researched the issue, then met on-line the night before the debate. Working into the wee hours, they drafted and rehearsed their arguments — entirely by IM. Coordination of schedules. Emily Giles, 15, of East Greenwich, R.I., uses IM to quickly organize gatherings. “U can ask a bunch of people if they can do the same thing all @ the same time,” she wrote in standard IM (rather than standard English) during an IM interview. “Its easier 2 keep track of who can do what n who cant.” Homework help. Casey Koppelson, 17, of Newport, R.I., sometimes uses IM for French-class assignments. If Koppelson needs the French phrase for “mow the lawn,” she sends an IM inquiry to SmarterChild, a free on-line homework helper. SmarterChild instantly searches its database of information and sends back a message with the words: “fauchez la pelouse.” Matchmaking. Sarah Kornblum, 16, of Natick, Mass., uses IM to introduce friends from different towns. “They chat on here for a while and get to know each other a little bit and THEN go out on a date,” she wrote. “So far it is working pretty well, if I do say so myself.” Many under age 25 can’t imagine life without IM. “I really don’t know what I did before,” says Aschenbrenner, who had never used IM before she started college last September. Now she’s so IM-dependent that when she stayed off-line for a whole day, her brother called to check on her. Please E-mail your comments to editors@inc.com. Related content: IM Product Sampler IM Legal Primer IM Etiquette

About 4221 days ago E-Commerce

The 2001 Inc Web Awards: Winners

The 2001 Inc Web Awards General Excellence Winner All-Outdoors Whitewater Rafting www.aorafting.com First place, Customer Service Second place, ROI Marketing finalist Honorable Mention Nova Cruz Products LLC www.xootr.com First place, Design Third place, Marketing ROI finalist Customer Service First place All-Outdoors Whitewater Rafting www.aorafting.com Second place Cadkey Corp. www.cadkey.com Third place Street Glow Inc. www.streetglow.com Design First place Nova Cruz Products LLC www.xootr.com Second place TidalWire Inc. www.tidalwire.com Third place Mosca www.moscahome.com Management (intranets and extranets*) First place Sunbelt Business Brokers Network Inc. www.sunbeltnetwork.com Second place National Services Group www.nationalservicesgroup.com Third place SLP Capital www.slpcapital.com Marketing First place Merriman Capital Management www.fundadvice.com Second place Earth Treks Inc. www.earthtreksclimbing.com Third place Nova Cruz Products LLC www.xootr.com ROI First place Ipswitch Inc. www.ipswitch.com Second place All-Outdoors Whitewater Rafting www.aorafting.com Third place The Connoisseur.cc Ltd. www.low-carb.com Sole Proprietors First place Limelight www.limelightart.com Second place Somerset Estate Sales www.somerset-estate-sales.com Third place Restaurant Connection Inc. www.restaurantstaffing.com *Management awards are given for Web sites that are password protected, so the URLs are only for the companies’ general sites. How the 2001 Inc Web Awards winners were selected: Earlier this year, 800 small businesses applied online for the 2001 Inc Web Awards. Using an Internet-based judging site, members of the Inc editorial staff screened all applications, eliminating ineligible entries and selecting finalists in six categories: Customer Service, Design, Management (intranets and extranets), Marketing, Return on Investment (ROI), and Sole Proprietors. We then had outside judges (listed on facing page) review the Web sites and submit comments and recommendations. Based on the judges’ input, Inc selected the winners. The Judges Ryan Bernard is president of Wordmark Associates Inc., in Houston, and the author of The Corporate Intranet. Mary E. Boone is the president of Boone Associates, in Norwalk, Conn., and author of Managing Inter@ctively: ExecutingBusiness Strategy, Improving Communication, and Creating a Knowledge-Sharing Culture. Bonny Brown is director of research at Vividence Corp., in San Mateo, Calif. Erik Brynjolfsson is codirector of the Center for eBusiness@MIT at the Sloan School of Management, Massachusetts Institute of Technology, in Cambridge, Mass. Michelle Chambers is the president and founder of New Tilt, in Somerville, Mass. Larry Chase is a New York-based marketing consultant, author of Essential Business Tactics for the Net, and publisher or Web Digest for Marketers in New York City. Steve Crummey is the cofounder and chairman of Intranets.com Inc., in Woburn, Mass. Bill Demas is an executive vice-president of Vividence Corp., in San Mateo, Calif. Paul Edwards is a self-employment consultant and the coauthor of Home-Based Business for Dummies. He is based in Pine Mountain Club, Calif. Martin T. Focazio is the CEO of Martin T. Focazio LLC, in Upper Black Eddy, Pa., and author of The e-Factor. Jeffrey Harkness is the cofounder of Diesel Design in San Francisco and the host of CNet’s monthly Design Talk radio program. John Hartnett is the CEO and president of BlueMissile, in Minneapolis. Randy J. Hinrichs is the group research manager in Learning Sciences and Technology, Microsoft Research, Microsoft Corp., in Redmond, Wash., and the author of Intranets: What’s the Bottom Line? Donna L. Hoffman is a professor of management, director of the electronic commerce concentration, and codirector of the eLab at the Owen Graduate School of Management, Vanderbilt University, in Nashville. Peter Kent is president of Top Floor Publishing, in Lakewood, Colo., and the author of Poor Richard’s Web Site. Michael P. Largey is the executive vice-president of IT Web Solutions Inc., in West Long Branch, N.J. Terri Lonier is the president of Working Solo Inc., a consulting firm in San Francisco, and the author of Working Solo: The Real Guide to Freedom & Financial Success with Your Own Business. Harley Manning is a research director at Forrester Research Inc. in Cambridge, Mass. Jakob Nielsen is a principal at Nielsen Norman Group, in Fremont, Calif., and the author of Designing Web Usability. Richard W. Oliver is a professor of management at Owen Graduate School of Management, Vanderbilt University, in Nashville. Don Peppers and Martha Rogers are founding partners of Peppers and Rogers Group, in Norwalk, Conn., and the coauthors of One to One B2B. Patricia B. Seybold is CEO of Patricia Seybold Group Inc., in Boston, and the author of Customers.com: How to Create A Profitable Business Strategy for the Internet & Beyond and The Customer Revolution. Beerud Sheth is the cofounder and general manager of eLance Inc., in Sunnyvale, Calif. James Slavet is the cofounder of Guru Inc., in San Francisco. Robert Spiegel is the author of The Shoestring Entrepreneur’s Guide to the Best Home-Based Businesses. He lives in Albuquerque. Phil Terry is the CEO of Creative Good Inc., in New York City. Mark C. Thompson is chairman and CEO of Network Public Broadcasting International Inc., in San Francisco, and chairman of Integration Associates Inc., in Mountain View, Calif. Bruce D. Weinberg is an associate professor of marketing and E-commerce at McCallum Graduate School of Business, Bentley College, in Waltham, Mass. Marcia Yudkin is the Boston-based author of Poor Richard’s Web Site Marketing Makeover and other Internet marketing guides. Ron Zemke is the president of Performance Research Associates Inc., in Minneapolis, and coauthor of E-Service: 24 Ways to Keep Your Customers When the Competition is Just a Click Away and other books. The 2001 Inc Web Awards The Best Small-Business Sites in America The 2001 Inc Web Awards: Winners A Web Strategy Runs Through It Traffic Magnets Duh-sign of the Times Home Groan Many Happy Returns Please e-mail your comments to editors@inc.com.

About 4374 days ago E-Commerce

Best Cellars

Best of the Net Internet wine sellers offer a great selection of labels and vintages. But laws governing interstate wine shipments can put a cork in your festivities Imagine uncorking your favorite wine one night — maybe a nicely aged 1990 California Cabernet Sauvignon or a terrific bargain Pinot Noir — only to realize that you’re down to your last bottle. No problem: glass in hand, you turn to the Internet and root through virtual cellars packed with thousands of bottles of wine. At first blush, wine and the Web look like a natural match. But ordering wine online isn’t quite as easy as ordering books or CDs. The number of suppliers is not the problem. Hundreds of Web sites peddle wine, including those of Internet retailers, wineries, and established brick-and-mortar wine merchants. But state laws governing the sale of wine across state lines make the process of finding a site that both suits your tastes and ships to your state a challenge indeed. We asked three company leaders with varying degrees of wine expertise to test six wine-selling sites: those of three online retailers, two big brick-and-mortar retailers (one located on the East Coast, the other on the West Coast), and an online cooperative made up of some 50 California wineries. The panel evaluated the sites for quality and variety of merchandise, interactive features such as wine searches, and ease of use and technical performance. The reviewers purchased wine from a variety of growing regions, including California’s Napa Valley, Washington State, Italy, and Chile. Two of our panelists had in fact bought wine online previously, and all three panelists enjoyed the experience of reviewing wine-selling Internet sites, but they said they wouldn’t be ditching their local wine store just yet. “A nice complement to wine stores — not a replacement,” says Shawn Kravetz, president of Esplanade Capital LLC in Boston and a wine enthusiast for more than a decade. In stores, “it’s nice to see the bottles, clipped articles, and prices in front of you.” The main benefit of these Internet sites: the vast selection of wines available, particularly rare or high-end bottles. One site offered a case of 1865 sweet wine from France’s famed Château d’Yquem for $208,550. For the more budget-conscious, a case of Bordeaux from the legendary 1961 vintage was available for about $4,000. The enormous selection of wines online was both a blessing and a curse, according to our judges. Panelist Jim Roop, president of the James J. Roop Co. in Cleveland, complained that most sites did a poor job of allowing customers to narrow their search. Sometimes, he says, you wind up with a list of “400 different wines” instead of the “40 Merlots between $20 and $40 you’re really trying to get to.’ And those state liquor-shipment laws were a hassle, preventing two of the panelists from buying bottles from some merchants. A labyrinth of state laws restricting who could sell liquor, and how, cropped up at the end of Prohibition, in 1933, when the details were resolved on a state-by-state rather than a federal level. “Every state is different,’ says Richard Blau, a lawyer at Holland & Knight LLC in Tampa and an expert on the laws that govern the alcohol industry. Many states prohibit wineries and retailers outside their borders from shipping wine directly to their own residents. However, a dozen states, including California, Colorado, Illinois, and Missouri, are more liberal than others in permitting wineries and retailers outside their lines to make direct shipments to the states’ consumers. Those 12 states have struck so-called “reciprocal agreements,” which basically say, “If I can ship to you, you can ship to me.” Some Web sites have been known to fulfill orders in violation of state laws — a move that can trigger legal action against the supplier and seizure of the wine. (For more information about pertinent state laws, visit www.wineinstitute.org.) Our Massachusetts and Ohio panelists came up dry at both K&L Wine Merchants and Winetasting.com. Massachusetts and Ohio are among approximately 30 states that restrict or bar outright direct shipments from other states. To circumnavigate prohibitions, some online sellers make special arrangements with local wholesalers and retailers to supply wines that are already available in a particular state, or they get licensed as retailers in the state. But K&L and Winetasting.com didn’t have either of those selling mechanisms in place for Massachusetts and Ohio and so declined to fulfill Internet orders there. Delivery, too, can be an issue, since an adult must sign for the wine. And shipping costs of $13.95 a bottle, as was the case in several transactions, can make online shopping uneconomical. “For an expensive or rare wine, it might make sense. But why pay the shipping costs when I can pick up the same bottles at my local wine shop?’ asks panelist Chris Dominguez, president of Stockpoint Inc. in San Francisco. No clear-cut winner emerged from our survey, although retailer Wine .com got solid marks from two panelists for its “decent” to “great” selection and “reasonable” shipping charges. (Unfortunately, Wine.com was swallowed up by competitor eVineyard as we were going to press and was consequently cut from the rest of this article.) In general our panelists tended to prefer sites that catered to their personal regional preferences, be it Bordeaux or Napa. Dominguez’s number one choice was the Web site of K&L Wine Merchants, a brick-and-mortar retailer in Redwood City, Calif. The California-wine lover praised K&L’s site for its ease of use and “excellent” choices. Roop’s first pick was WineBins.com, an online seller. Roop, a Bordeaux enthusiast, liked the “absolutely huge range of product, particularly older French wines.” Kravetz liked best the Web site of New York retailer Sherry-Lehmann. “Seems like a wine store instead of an Internet business,” he says. And there was no obvious loser either, although our panelists did find fault with some offerings. Dominguez dinged Sherry-Lehmann. The second time he visited its site, the pages failed to load. His wine took more than four weeks to arrive, and he thought the shipping costs from New York to California were high at $13.95 a bottle — although the company agreed to waive those fees because of the shipping delay. Roop handed the booby prize to Winetasting.com, the online cooperative of California wineries. It didn’t help that the Ohioan couldn’t place an order with that site. “But most aggravating of all is that there is no pricing listed next to the wine,” he says. A browser must click on a particular wine to see its price. Kravetz said WineBins.com was his least favorite, criticizing the “average selection” and the site’s “impossible” loading time. “Maybe the wine ages while the page loads,” he jokes. Roger Fillion is a freelance writer living in Evergreen, Colo. The Savvy Entrepreneur’s Guide to Wine Online eVineyard What it’s good for Reasonable shipping fees. Good variety. Wine ratings. Don’t waste your time if You’re looking for a particular bottle. Although the site boasts more than 5,000 wines, one panelist complained of unsatisfactory selections among the California wine makers he was interested in. What our CEOs had to say “Enjoyed their variety, incorporation of Wine Spectator [magazine] ratings, and higher-end offerings, coupled with a very reasonable $4.95 blanket shipping charge for a bottle or a case,” said one CEO. But another panelist stated: “Simple, decent, a bit entry-level.” What you should know Offers Amazon.com-style recommendations by listing other wines purchased by shoppers who chose your wine. K&L Wine Merchants What it’s good for Rare U.S. and European wines. Ease of use. Tasting notes from own staff, Wine Spectator, and wine gurus like Robert Parker. Don’t waste your time if You live in a state with restrictive alcohol-shipping laws. Internet orders are accepted from just 13 states. What our CEOs had to say “Will not deliver to my state. Too bad. I like their top-10 list and their site overall. Not fancy, but good.” What you should know Web site for big California retailer in Redwood City. Site typically offers about 3,000 wines. Sherry-Lehmann What it’s good for Wines of all prices. Good descriptions. Free delivery for New York state residents who spend in excess of $95. Don’t waste your time if You live outside New York state and don’t want to pay steep shipping charges. What our CEOs had to say “A good selection of both high-end and low-end product. But you better buy only high end, because their shipping charges are through the roof, at $13.95 for one to three bottles and $55.80 for a case of 12.” What you should know Will not ship to nine U.S. states. Oenophiles can buy wine futures — lock in a price for a 1999 Bordeaux that won’t arrive until June 2002. WineBins.com What it’s good for Less expensive California bottles to older Bordeaux dating back to the 1800s. Shipping fee for one case is a reasonable $9.50. Don’t waste your time if You really dislike slow-loading pages — which one panelist complained about — and don’t want to pay the same $9.50 shipping fee for just one bottle. What our CEOs had to say “Offers by far the widest range of product of the group,” said one judge. But another criticized: “Searching by ‘flavor’ is good [only] for novices.” What you should know Virtual retailer owned by Geerlings & Wade Inc., a direct marketer and Internet retailer of wines. Offers 1,000 wines. Serves 29 states. Winetasting.com What it’s good for California wines, especially hard-to-find product such as bottles available only from the wineries themselves. Examples: Cabernets from the 1980s or Merryvale’s highly rated 1997 Profile, a red blend. Don’t waste your time if You don’t want California wines. What our CEOs had to say “Requires some effort to search. Limited selection. But very high quality. Kind of like shopping at a boutique instead of a wine emporium.” What you should know Virtual cooperative made up of some 50 California wineries. Site is a hub from which you’re transported to a winegrower’s own site. Serves 20 states. Our panelists Chris Dominguez is president and cofounder of Stockpoint Inc., a San Francisco-based provider of online and wireless investment-analysis tools and financial information. A resident of northern California for the past dozen years, he regularly visits Napa Valley. Shawn Kravetz is president of Esplanade Capital LLC, a hedge-fund-management company in Boston. A wine enthusiast for more than a decade, he especially enjoys red Bordeaux. Jim Roop is president of the James J. Roop Co., a corporate-communications consulting firm in Cleveland. Roop is past chairman of the Cleveland Wine Auction, a benefit event, and a member of Commanderie de Bordeaux, an international society of Bordeaux lovers. Please e-mail your comments to editors@inc.com.

About 4374 days ago PCs, Laptops, and Notebooks

See Bot Run

Bulletin Board Mike dooley had to find a needle in a haystack. Dooley, a business-research specialist, works for the Ball Corp., a manufacturer of food and beverage containers in Broomfield, Colo. He had heard rumors that a competitor was planning to construct a new building. But nothing had been announced, and Dooley had no idea where to look for clues. Fortunately, the information came in his daily E-mail from CyberAlert Inc., which produces a surveillance robot, or “bot,” that scours the Internet for news on topics chosen by its customers. Dooley had set his bot to search for the competitor’s name. In the online edition of a local newspaper, it picked up the announcement of “an environmental filing” for the rival’s new warehouse. Surveillance bots aren’t new to the Internet, but they have become more powerful in ferreting out information that a CEO might want to know. Newer bots can go deep, delving into message boards, scouring pages not written in HTML, and even searching the portions of sites that are considered technically out-of-bounds. “It’s not necessarily spying, but rather staying abreast of what the competition is up to,” says Somesh C. Nigam, CEO of E-procurement-software start-up Vinimaya Inc., in Tarrytown, N.Y. Nigam uses Intelliseek’s Corporate Intelligence Service to eavesdrop on message boards where potential customers talk to one another. After learning that purchasing agents were complaining bitterly about technical difficulties in processing electronic transactions, Nigam got the idea for his company’s newest product: ViniSyndicate, which translates data for B2B buyers and sellers. The cost of bot surveillance varies widely. Some do-it-yourself technology can be downloaded from the Internet free. CyberAlert, the company Dooley used, charges $395 per topic per month for daily reports. Another bot provider, RivalWatch Inc., in Santa Clara, Calif., charges from $20,000 to several hundred thousand dollars for a one-year subscription to its service. But be forewarned: bot surveillance is fast becoming a legal issue, according to Brian Proffitt, managing editor of BotSpot.com. Some sites don’t want snoops poring through their pages, he says. Popular auction site eBay sued a bot that compared sales on auction sites, accusing it of trespassing. Be wary, too: bots are spying on your Web site now. So consider counterespionage. Bot-spotting software is available. Bulletin Board See Bot Run Rent a Phone, Lose a Headache No Receptionist Necessary Things We Love: Home-Phone-Line Networking Log On, Turn Off, Spend Less Acronym Watch A Network for Networkers A ‘Black Box’ for Your Car Please e-mail your comments to editors@inc.com.

About 4586 days ago E-Commerce

Web Awards 2000: Innovation

First place Sumerset Custom Houseboats (See ” Web Awards 2000: General Excellence.”) Second place Yadda Yadda Yadda Company: Lûcrum Inc. Web address: www.lucruminc.com Why it won: Its cutting-edge multimedia keep visitors coming back for more. Company revenues: $19 million Site-launch cost: $10,000 Judge’s view: “Nice, nongratuitous use of audio media to create, inform, and maintain [its] customer base.” –Jordan Ayan Ben Franklin’s knowing gaze presides over the home page of Lûcrum Inc., an E-business services company in Cincinnati. Those who are well endowed of wallet will recognize the image from the $100 bill. It’s an appropriate image for the business’s site, given the company’s name, which evokes the idea of lucre (money, to the uninitiated). Lûcrum president, CEO, and founder John Bostick explains that the logo and the name are part and parcel of the company’s motto: “Digital strategies that improve your bottom line.” Bostick’s dry sense of humor belies the seriousness of that message: he almost named his software-development shop Vandelay Industries, after the nonexistent company that George Costanza of TV’s Seinfeld claimed to work for. Although there wasn’t anything wrong with that, Bostick, 41, decided to stick with the existing name, Client Server Associates. In recent years the company has caught the Internet wave and refocused on E-business. The new name — and the Web site — were launched this year. Lûcrum’s site is particularly innovative in its use of multimedia. For example, the company’s customers — and others who want to stay in the know — tune in every week to Lûcrum Radio, a weekly Webcast on such timely E-business topics as customer-relationship management. Users have the choice of tuning in live, listening to an archived version, or picking from more than 40 archived titles and creating a customized CD. “Customers can throw their desired content on a CD and play it in the car on the way to work,” says Bostick. For an investment of 8 to 12 minutes per subject, Lûcrum’s customers can get up to speed on all the latest trends. The site also features a collection of video clips and a media digest of pertinent articles on such topics as E-commerce patents and digital-supply-chain issues. Lûcrum pushes hot content to its customers in a weekly E-mail blast. The idea is to give users a quick overview of what’s going on in business through a mix of media. The site gets between 2,500 and 3,500 unique visitors a month, and users stay an average of four to seven minutes per visit. Lûcrum’s sales team garners at least two good leads a week from the site. That all sounds pretty good, but Lûcrum director of marketing Stephen Smith is never satisfied. Smith and Web-content manager Chuck Fields plan to change the site’s navigation to emphasize content first rather than the glitzy (and slow) Flash intro. Says Bostick, “Above all, we want our site to be functional.” Judge Omar Wasow applauded that move. Said Wasow, “Function [must go] before form on the Web.” –Lauren Gibbons Paul Third place Cross-Country Savings Company: Dandelion Moving & Storage Inc. Web address: www.dickerabid.com Why it won: The site offers a clever way to exploit a new market by matching small moving companies with price-conscious individuals. Company revenues: $1.8 million Site-launch cost: $15,000 Judge’s view: “An innovative application of the Internet-bidding concept in a different market.” –Jordan Ayan Bret Lamperes, owner and CEO of Dandelion Moving & Storage Inc., in Fort Collins, Colo., is a true veteran of the schlepping biz. He was in the third grade when his mother and stepfather launched the company with one small truck. He grew up in the family business and bought it at age 25. Lamperes understands a particular truth about trucking: in prosperous times, people move a lot of freight and business is good. But a slowdown can hit suddenly and create cash-flow crunches for small movers. At the end of 1999, says Lamperes, “everyone was moving a ton of freight because they were worried that Y2K would shut everything down.” But in January 2000, demand crashed and fuel prices jumped. Dandelion lost $100,000 to the freight feast-or-famine syndrome. But Lamperes was not the kind of entrepreneur who sinks all his hopes and fortunes into one venture. He had already started an express courier service (from which he later extricated himself) and a ministorage business. And he had a new plan, too: a kind of reverse auction for people who need movers, in which small moving companies could bid on jobs. Typically, the lowest price would win (although some customers choose movers based on their availability on moving dates). Lamperes hooked up with Web designer Erik Madsen, who was between contracts last fall. Madsen wanted to make some quick cash before the holidays, so he cut Lamperes a deal: $8,000 to design, build, and launch the site. By March, Madsen had a working model for the site, called DickerABid.com. Then came a snafu: the company that had agreed to process credit-card transactions on the site backed out. Lamperes scrambled for a replacement, and in June he launched the site with minimal marketing. He used his existing site, Dandelionmoving.com, to direct traffic to the new site, and he registered DickerABid with search engines. Customers who came upon the site posted their moving jobs, and Dandelion and four other companies began bidding on them. At press time, the site, with one employee working on it full time, had packed in an extra $14,000 in business for Dandelion. Lamperes is looking for financing to build DickerABid into a force to be reckoned with. He’d like to expand his base of movers to 20, and he envisions the advertising potential for moving-related companies, such as those that sell blinds or furniture. In the works: a mapping module that will help movers route their trucks for maximum return. “If you have room in your truck, you can pick up a job for $200 or $400 on the way, and that pays for your fuel,” says the CEO. Our judges liked Lamperes’s line of thinking. “This site builds a market where one never existed, and does so elegantly and with a commitment to integrity and quality that all sites would do well to heed,” said Omar Wasow. –Jill Hecht Maxwell Conversation with Guy Kawasaki Judge: Innovation “I have learned that basketball is a window onto a person’s soul,” says Guy Kawasaki, CEO of Garage.com, a venture-capital investment bank based in Palo Alto, Calif., that serves high-tech start-ups. “Someone who hogs the ball on the court will not be a team player in a company. Someone who doesn’t hustle on the court won’t hustle in business. Someone who cheats — well, you get the picture.” So, too, is a Web site a window onto a person’s or a company’s soul, he says. “When you see a clean, fast Web site, you can assume that the company is pragmatic and useful. When you see a Web site that takes 15 minutes to boot with all kinds of video, music, and multimedia clogging things up, it’s a warning that the company is more flash than cash,” he says. Kawasaki’s roots with the digerati run deep: He spent six years at Apple Computer, leading the charge that put the Macintosh on the map. Yet despite his self-admitted bias toward pie-in-the-sky product development, Kawasaki has a decidedly retro take on Web-site innovation. “You may find this hard to believe,” he says, “but I’m not sure that innovation is the key factor for a Web site. Factors like usability, elegance, and speed are more important.” The sites he chose as winners, he says, merge creativity with pragmatism to facilitate rather than merely dress up business transactions. “The sites that I liked didn’t look as if they were intended to win awards. They looked like they were built to serve customers.” –Thea Singer Annual Web Awards 2000 General Excellence Marketing Customer Service ROI Innovation Community Judges Please e-mail your comments to editors@inc.com.

About 4647 days ago E-Commerce

Got Money?

Ed Palmer might not think of himself as a pioneer. But he’s among the first wave of company builders to look for investors on the Internet without a middleman Ed Palmer is at his desk, bracketed by two Macs, poring over the number of hits received by the various components of his business’s Web site. The company’s only other full-time employee is a cubicle away, dashing off a string of E-mail notes from his computer. This could be almost any Web start-up, if it weren’t for the company’s only other room–a storage room across the hall–one that should be filled with humming servers and blinking modems. Instead, the room turns out to be littered with crates, pallets, and ungainly mechanical devices–an inventory of actual things. Palmer’s company, SolarAttic Inc., is not a flash-fire Silicon Valley Web start-up but a conventional small company in a Minneapolis suburb that has been engaged in a gritty, 13-year struggle to score with products that could at best be called medium-tech. What especially distinguishes SolarAttic from the typical Internet business is that despite the fact that sales have been taking off, venture capitalists, angels, and other investors have not been lining up to hurl money at the company to propel it into the next stage. As a result, Palmer has modified SolarAttic’s growth strategy to include an on-line wrinkle so cutting edge that few Web businesses have dared to try it. Namely, the company is trying to go public by finding its own $1,000-here, $500-there investors over the Internet. No investment banks, no brokers. The realization of ultra-low-cost, wide-open stock offerings–a pure, frictionless transfer of money from the public to a company–may ultimately become one of the most powerful applications of the Internet. It’s turbocapitalism: for ordinary investors, a chance to get in on the ground floor of even tiny, distant, or obscure companies; for underfunded, non-Web start-ups, an opportunity to get their story out to people who might be willing to take a modest gamble. Dozens of companies have already altered the conventional model of fund-raising to take advantage of the Internet’s reach and efficiency. But surprisingly few companies have tried to go all the way and strip their efforts down to a simple on-line proposition: send me money and I’ll give you a piece of my company. SolarAttic, as unlikely a high-tech pioneer as it may be, is one of them. The results have not been entirely pretty. Despite garnering a small sea of leads, the flow of actual on-line investment in the company has barely reached the level of a trickle. Among the challenges the company continues to face: getting the right people to its site, differentiating its offer from those of con artists, and slogging through a morass of state regulations. But SolarAttic is forging ahead, learning what works and what doesn’t as it goes along. As the company embarks on its third public offering–the second that is based on the Web–Palmer offers a simple explanation for why he keeps at it: he is convinced, as are many others, that this is just too good an idea to ultimately not work. Anyone who has ever climbed into an attic on a sunny day can appreciate the basic idea behind SolarAttic. Heat gets trapped up there. Why not put it to work? Palmer, for one, cannot abide the fact that energy is literally floating around the tops of homes while their owners pay good money for heat in other forms. Call it an engineer’s disdain for the inefficient. Palmer worked on guided-missile-system computers for the navy and later on civilian computers, before a friend’s offhand remark 16 years ago changed his life. The English, said the friend, often keep their water heaters in their attics not only for the pressure gain that gravity provides but also for the free temperature boost. Never mind that the English also eat meat in pies and beat one another up at sports events. Free energy was a good thing, Palmer declared, and worth following up on. Two years later, with salaried life permanently behind him, Palmer began his attic-heat-tapping experiments–ultimately taking over nearly two-thirds of the floor space in his Elk River, Minn., home, including the entire basement and garage. The goal: to figure out a way to transfer the heat to piped-in water that could then be pushed into a swimming pool. Since he didn’t own a pool, he set up a 125-gallon horse trough in the garage; to compensate for Minnesota’s frequent dearth of sunlight, he set up electric heaters in the attic to provide heat that he could then get rid of. His efforts fell short until he hit on the missing ingredient: a fan to blow the hot attic air over his boxed-in network of thin piping. Unfortunately, having a good product concept and moving a good product are two different things. At the rate Palmer was going, he had already run through his savings; he and his wife were living on $12,000 a year, mostly borrowed, and his wife was doing all their home maintenance and repair work. He went to a venture capitalist and was told to come back after he sold the first 100 systems. He went looking for angels but found himself in a geographical bind: investors based in mostly chilly Minnesota couldn’t relate to the pool market in general and to a solar-dependent product in particular; investors in warmer climes were not interested in a company that was so far away. He kept plugging away. “If you lose faith, that’s when things start to unfold on you,” he says. Finally, in 1986, Palmer wrote up a list of just about everyone he had ever known and sent roughly 700 of them a letter asking them to invest, valuing the company at $1 million. He was even willing to trade away majority ownership of the company if he could raise that much, since he figured he could exercise effective control with a concentrated 20% of the stock. In any case he raised a nonthreatening but badly needed $50,000. Palmer’s first sale wouldn’t come for three more years. In 1989 he finally sold a pool heater–to a reseller in Florida–for $1,600. And the feedback from that first sale was extremely promising. After performing a test, the customer reported that his pool’s water temperature had risen by 20 degrees to 98 degrees Fahrenheit. Even better, as the temperature in the pool went up, the customer’s energy costs to heat the pool went down. Typically, pool owners have reported costs as high as $300 per month to heat their swimming pools. By contrast, Palmer’s heater costs about $11 a month to operate, treating pool owners to a “warm pool without hot bills,” as Palmer puts it. Heating pools is not a quirky endeavor. According to Palmer, it is a $200-million annual market, based on the number and retail cost of pool heaters being sold. By the early 1990s, Palmer started thinking seriously about going public. It wasn’t grandiosity; he had simply recognized that the SEC had lowered the bar for small-company securities offerings a few years before by creating the small-corporate-offering registration, or SCOR, and so-called Regulation A offerings, both of which require no or minimal scrutiny from the SEC. Subject to state regulation, companies can raise up to $1 million in a 12-month period with a SCOR, or $5 million with a Regulation A offering. Palmer talked to brokers, but none were interested in taking part in offerings below $10 million (Palmer’s was less than $5 million) and the correspondingly small fees that their 10% commission would generate. No problem, he thought. He’d do it the way he had done everything else: on his own. In 1994, Palmer filed for a $1.5-million-minimum and $3-million-maximum Regulation A offering in Minnesota, and was promptly blindsided by state regulators, who told him he had only 180 days to raise the money–even though there was no such rule on the Minnesota books. Palmer eventually resolved the matter with state regulators, but the fight had been so time-consuming that the offering languished and ultimately fell short, necessitating the return of the $250,000 he had raised and placed into escrow. But Palmer walked away with a list of 1,000 interested investors, and to a few of them he sent a letter offering a private placement at a 20% discount from the public offering price, which generated $125,000. Two years later Palmer figured it couldn’t hurt to put up a Web site that provided sales and technical information about his company. It wasn’t long after the site’s debut that he realized the Web could be a big selling tool for SolarAttic. “People used to call about a product and ask something like, ‘What’s the PCS1?” notes Jim Stanley, Palmer’s half-brother and SolarAttic’s vice-president of sales and marketing. “Now they download the technical manual first, and then call and say, ‘Here’s my credit-card number.” By mid-1997, the site was pulling in as many as 40,000 hits a month (and it now pulls in roughly 100,000 a month). That was the good news. The bad news was that the company was now generating far more leads and opportunities than Palmer and Stanley could handle. Ultimately, Palmer wanted to hire more people–and he figured that with an expanding array of products, the potential market he could tap into could be worth as much as $10 billion. The capital requirements of that vision, combined with the fact that he was still living on fumes himself, meant that he needed another round of financing. Drawing on a heady brew of desperation, optimism, and masochism, Palmer decided to go back to the public offering well in a big way. While mulling over strategies for how to make things turn out better this time, Palmer stumbled across an article that told how Spring Street Brewing Co. had conducted a successful Regulation A initial public offering over the Internet. (See ” The Real Legacy of Spring Street Brewing.”) It all double-clicked for Palmer. To his engineer’s eye, using the Web to facilitate the transfer of small plugs of money to the stock of a small company whose potentially fabulous growth was being stunted by a lack of capital was like, well, using the PCS1 to transfer heat from a stuffy attic to a chilly pool. Three trends central to the recent evolution of our economy point to the likelihood that small investors will embrace Internet-based direct stock offerings from small companies: The small investor has become more independent of brokers and mutual-fund managers, less risk averse, and more enamored of IPOs. The Internet has gradually been greasing the gears of investment mechanisms, cutting commissions and making more investment instruments and professional-quality information about them directly available to anyone with a computer and modem. The country’s economic engine is increasingly fueled by small companies. Direct public offerings will provide opportunities far more interesting than today’s typical IPO. Currently, the vast majority of small investors are locked out of IPOs altogether, and anyone who does manage to buy in is paying not only for a piece of the company, but also for the underwriter’s 7% commission and at least 3% or so in other fees related to the costs of going public. What’s more, the companies represented by today’s high-profile IPOs have had their growth and market potential thoroughly plumbed by venture-capital and investment-banking pros; the chances that you’ll see something that everyone else has missed, and thus end up with a true bargain, are not good. Buy directly into a tiny, unsung company’s do-it-yourself Internet offering, on the other hand, and you’ve got a genuine, undiluted chance of surfing in front of a wave of growth that other investors–including the pros–haven’t spotted. Needless to say, the risks would be correspondingly high. To pick the gems out of what will likely be a field made up predominantly of losers, small investors will have to do what angels do today: apply careful analysis and good instincts. Except you won’t have to risk $50,000 or more, as you typically do today, to buy in at ground zero; $500 or so should do it. Welcome to the dawn of the micro-angel. What can small companies hoping to raise money through an Internet DPO do to connect with potential micro-angels? Unfortunately, you probably won’t learn much by examining the offerings out there today. I searched the Web using keywords and phrases like IPO, direct public offering, investors wanted, SCOR, and the like, and checked out dozens of small-business and capital-raising-related sites and bulletin boards. Of the 20 or so registered small-company stock offerings that I turned up, many appeared to be hybrids of one sort or another, depending at least as much on conventional techniques as on the Web to attract and convince investors. The bottom line: the pure Internet DPO is largely unexplored territory. On the other hand, three years from now it will probably seem like old hat, with thousands of small companies competing for investors’ attention. The ideal moment to strike will probably lie somewhere between now and then–and your guess is as good as anyone else’s. If there’s a shadow hanging over the on-line DPO market, it’s that being cast by securities fraud. Traditional stock offerings are heavily scrutinized by brokers and the SEC; typically, no one does due diligence on a DPO. DPOs that take place entirely on the Internet are ripe for con artists for the same reason that they are so appealing to legitimate companies: they are quick and cheap to set up. The SEC has charged 83 individuals and companies in the past year with Internet securities fraud, 26 of them for hawking entirely fictitious deals. Two years ago a company called Interactive Products and Services (IPS) Inc. rolled out a DPO to develop WebTV products; the offering was listed entirely on the Internet. IPS pulled in about $200,000 from small investors before California officials shut the operation down as a scam and sent its CEO to jail. Not surprisingly, con artists have figured out the kind of leverage they can achieve via the Net. In my search for offerings, I came across hundreds of bulletin-board investment solicitations in almost comically fishy-sounding ventures ranging from gold mines to magazines for “exotic models.” But only the most naïve investors would be taken in by those sorts of come-ons. On the other hand, what to make of a company like Fonecash.com? Listed on Direct Stock Market (DSM), a Web site that specializes in listing DPOs and private placements, as a developer of a credit-card-transaction-processing device, Fonecash.com is floating a $990,000 DPO. The Fonecash.com Web site consists of an “under construction” notice, and the company had not returned phone calls by press time. Another DSM-listed company, Specialized Autocore Services Inc., also failed to respond to a request for information, and the phone number of a third company on the site, the Gourmet Source Inc., yielded a “no longer in service” message. Investors aren’t likely to throw their money into an operation that doesn’t even answer its phone. In mid-1996, Ed Palmer decided to run a little test, putting up on the SolarAttic Web site the prospectus from his 1994 stock offering. Sure enough, he started getting E-mail requests for more information. By the end of 1997, his new offering was in place on the site. SolarAttic now had a better picture to present to potential investors. The company’s sales-growth rate was close to 80% and accelerating hard. A pool dealer in Arizona signed on as the first official SolarAttic regional dealer. But once again Palmer found himself facing off against state regulators. The offering met with relatively little resistance in Connecticut, New Jersey, and Rhode Island. Palmer also painlessly tacked on Delaware, Arizona, and Colorado because those states require almost no paperwork, provided that a company is going after only a limited number of accredited investors. But Wisconsin, representing seven midwestern states that allowed pooled registration, dictated that a minimum amount of money be raised. The funds had to go into escrow until the minimum was met; if not, the money had to be returned to investors. California refused to accept the filing as a SCOR offering, instead requiring that Palmer fill out a long questionnaire that addressed the same information. The Nebraska Department of Banking and Finance sent Palmer a letter threatening criminal prosecution for violating a state law against unregistered solicitation of funds because of the Web site, even though the site clearly stated that Nebraska residents were not eligible. But it was Minnesota regulators who again seemed to set out to prove themselves the pit bulls of the DPO world, demanding that the company set up an “independent, disinterested” board of directors and even issuing a stop order against the offering. Reflecting on those and other state regulatory hassles sends Palmer into a Lenny Bruce-like rant. “These regulators were engaging in illegal activities,” he fumes. “They were breaking their own laws. How is a company supposed to put together a disinterested board? Is that an oxymoron, or what?” He churned out a press release accusing one Minnesota regulator of imposing several illegal requirements on SolarAttic. And he ended up dropping most of the rule-mongering states from his offering. Palmer claims the battles with Minnesota regulators cost him in excess of $90,000 in legal fees and his time, and set the company back years. “The SCOR rules were supposed to make it easy for small businesses to go public,” he says. “It’s supposed to be uniform, but each state lobs its own preposterous things at you. They say it’s to protect the public from crooks, but crooks don’t care about the rules. It may seem strange to hear this from a small-business owner, but I wish the federal government would take over the regulation of these things.” When the regulatory hassles were finally behind him, Palmer started to focus on driving potential investors to his Web site. He started by analyzing statistics that told him where visitors were coming from and what they were doing when they got to his site. For example, 9% of visitors came to the site from a Yahoo search, and of those, 38% had included the word solar in their search, versus only 3% who had used accredited. Only 2.5% of visitors were examining the offering “tombstone,” and eight times as many visitors were downloading technical manuals as were downloading prospectuses. Conclusion: Yahoo searches were a great potential source of referrals, but they were sending over mostly potential customers, not investors. In light of that information, Palmer decided to sign up for a $4,500 banner ad with Yahoo. The ad would be displayed at the top of the search-results page whenever someone asked for such investment keywords as IPO, DPO, SCOR, and so on. But after studying stats revealing that after 20,000 showings the banner had enticed only 200 people to click to the SolarAttic site, Palmer discontinued the ad. Next, he contracted for 50,000 page views of an ad for his offering with the Wall Street Journal Interactive Edition–ads that, he says, would be shown only to the site’s 18,000 subscribers in New Jersey, Connecticut, and Rhode Island. But again, the results were disappointing: 200 hits, after subscribers had been exposed an average of three times each to the ad. “I realized that people don’t want to be distracted by banner ads when they’re on-line looking for information,” says Palmer. “It doesn’t make sense to pay thousands of dollars for 200 hits when I can generate 300 hits from a $90 Business Wire press release.” Palmer also tried talking up his offering in various newsgroups, on bulletin boards, and in chat rooms, posting nearly 7,000 messages. But most of the forums quickly erased his messages, presumably for the same reason cited by the Motley Fool when it erased the message Palmer had placed in the “Minnesota” section of that site: the site is for publicly traded companies only. The sites that didn’t erase his message generated mostly “nastygrams,” as Palmer puts it. By that point, he knew better than to try a mass E-mailing, a.k.a. spamming. “People don’t want unsolicited E-mail, period,” he says, noting that it’s difficult to limit such mailings to particular states. Instead, Palmer limited his mailings to “opt-ins”–Web surfers who indicated their interest in receiving them. Finally, Palmer says he spent $750 to place his offering on DSM. DSM has since turned over some 40 leads to him, but most turned out to be from states in which the offering wasn’t registered. Palmer says DSM and other sites like it can be useful; for one thing, such sites often offer mechanisms for investors to trade stocks originally offered in a DPO, providing much-needed liquidity to the investment. Other lessons: few people are interested in downloading an 82-page prospectus (a process that takes about 10 minutes via a standard modem connection), judging by the fact that only a small number of people ever bothered to download his; no matter how interested investors become in the stock, they’re more likely to call up to buy rather than plug in their credit-card number; and $500 is the largest acceptable minimum investment for most Web surfers, something Palmer figured out after starting off with a $3,000 minimum before dropping it to the lower figure. Oh, and one more thing: pioneering is hard, be it for attic-heat-transfer systems or Internet fund-raising. Palmer ended up raising a mere $20,000 on this round. On the plus side, the company got to keep the money this time around because it had avoided states that required a minimum level of funding–proving, at least, that some sort of useful learning curve is in effect. Even better, the company’s increasingly bright sales picture has helped Palmer bring the total amount of money he has privately raised to over $600,000. (He now owns no stock personally but through a family trust exercises control of 40% of the company.) The obvious conclusion: private fund-raising was the way to go for SolarAttic. But that wasn’t the way Palmer saw it. “I know we’re destined to be a public company,” he says. Ever the optimist, Palmer concludes, “We could grow to a hundred million a year, easy.” That’s a long way from the $118,000 the company brought in last year, but, on the other hand, revenues so far this year are up 250% over the same period last year. There are now more than 200 SolarAttic pool-heating units installed throughout 31 states. Buoyed by that growth rate, at press time Palmer was registering a $4.8-million Regulation A DPO in New York and–combative fellow that he is–Minnesota. He ticks off the reasons that things will be different this time around: he’s learned a lot of the ins and outs of marketing stock on the Internet; Internet DPOs are gaining credibility; and he knows how to keep the satanic state regulators at bay. He also says he’s going to try to play the affinity card this time around, using the Internet to zoom in on the environmentally conscientious. He’s also going for a reverse affinity play. “If you’re a pool owner who learns about our technology as a potential investor, I might get you as a customer, too,” he says. And if this round fizzles like the others? Then he’ll try again. “I go by the kick-the-can theory of money raising,” he says. “I won’t allow myself to think I have to have a certain amount or I can’t make the business go. That’s linear thinking. I’ll spend the rest of my life making this work.” You can almost hear the Minnesota regulators gnashing their teeth. David H. Freedman is a contributor to Inc. Virtual road show Clay Womack, CEO Direct Stock Market Launched: 1993 What Direct Stock Market is: A listing service for direct public offerings (DPOs) and private placements. Direct Stock Market provides an on-line community environment in which investors can discuss offerings, but they must do their own due diligence. Direct Stock Market also helps companies to put together Web-based “virtual road shows.” And isn’t: An automated system for filing a Regulation A or Regulation D offering. You still have to do all the paperwork yourself–off-line. The on-line advantage: Investors can scan the prospectuses of several dozen DPOs and private placements, and companies can get their offerings in front of thousands of small-business-friendly investors. “There are 80,000-plus businesses in the United States that are growing at a rate of at least 50% per annum, and the VCs are only doing 2,000 deals at any point in time,” says Womack. “I want the other 78,000 businesses on our site.” Your odds of finding funding: Probably better than if you posted the offering only on your own Web site. Womack has done a good job of generating publicity for the site. But mismatches are common. Interested investors may respond on-line from states in which your DPO isn’t registered. On the other hand, if Direct Stock Market becomes a broker-dealer as planned, your offering could find a much wider audience. (For a price.) Fee: From $2,500 to $4,000, depending on the size of the offering, for a 90-day listing. –D.F. We’re from the government. We’re here to help Terry Bibbens, Entrepreneur in Residence Ace-net Launched: 1997 What ACE-Net is: A Small Business Administration-sponsored listing service for companies that have completed the paperwork for a streamlined direct public offering (DPO). The Angel Capital Electronic Network (ACE-Net) was designed to make small offerings (up to $5 million) cheaper and easier to pull off by eliminating the need for a broker-dealer and lowering the legal barriers; a listing on ACE-Net satisfies many states’ securities regulations. And isn’t: A vehicle for launching a full-fledged DPO–you can’t sell stock to just anyone, only to “accredited” investors. The on-line advantage: “A single filing on ACE-Net suffices to exchange stock certificates and checks in multiple states. The offering document is created from a simple Q&A the entrepreneur fills out on-line. Your lawyer, accountant, and board can also log on and review the document and make changes in real time. And you can also quickly modify the offering depending on the marketplace. Rewriting the offer and refiling it is not hard to do on-line.” Your odds of finding funding: Until recently, dismal, if you hoped to do a national direct offering. Despite its government connections, ACE-Net has lacked crucial nationwide support and publicity. That’s slowly changing, now that 37 states and 1,000 investors are on board. In one recent six-month period, 20% of the 140 companies listed in ACE-Net’s national database had received financing. The DPO route hasn’t exactly caught fire, perhaps because it’s the wrong vehicle for appealing to angels. But you don’t have to do a DPO to tap local ACE-Net resources–and connections to angel groups. Fee: Up to $450 for an annual listing. –Susan Greco The IPO classifieds Stephen D. Pelletier, CEO Offroad Capital Corp. Launched: 1999 What OffRoad Capital is: A “placement agent” for established private companies seeking growth capital of $3 million to $15 million. Several thousand accredited investors–including angel groups and some VCs–are expected to kick in a minimum of $25,000 per investor per deal. Road shows will be real and virtual: CEOs make studio appearances and take questions from investors via E-mail or phone. “We’re not just a listing service. We help these companies get financed.” And isn’t: An underwriter of deals. The on-line advantage: The ability to create a public “marketplace” for vetting and selling private placements. “Real companies with real revenues and profits should be able to tap equity, not just debt. Within three years, it will happen,” says Pelletier. “We’re using the Internet to create a marketplace for growing companies.” Your odds of finding funding: Slightly better than at Garage.com if your annual sales growth is at least 20% and your company’s valuation is at least $20 million. You also need a clear exit strategy, such as a public offering, merger, or acquisition. Of 400 companies recently considered, 5 have received financing. All industries are welcome, but “don’t be surprised” if the first deals are Internet plays, says Pelletier. Fee: From 3% to 9% of any money raised. –S.G. A match made in . . . cyberspace? Guy Kowasaki, CEO Garage.com Launched: 1998 What Garage.com is: A matchmaker for company founders and sophisticated angel investors, select venture capitalists, and corporate venture-capital divisions. Entrepreneurs receive help with creating a management team or marketing strategy and with pitching their companies to the investors involved, who collectively have kicked in an average of $2.9 million per deal. “We’re a broker-dealer, quasi investment banker, and what I call a venture ‘gapitalist.’ We fill that gap from $1 million to $4 million,” says Kawasaki. “The bottom line is we’re trying to help two guys or two gals in a garage get seed capital. We find ‘em, fix ‘em, and fund ‘em.” And isn’t: The final word. “Angels have to do their own due diligence. There’s no on-line yenta yet.” The on-line advantage: “It’s compressing time to ‘high value’ money and providing a greater breadth of exposure for the entrepreneur. It’s all about opening up the channels. Taking information over the Internet is 100 times more efficient for us than taking a paper business plan. We determine the questions and how much space entrepreneurs have to answer each one–it’s all standardized. And the plans are searchable forever. All plans are created equal through the Internet. And we read every one of them.” Your odds of finding funding: Nil, unless you’re a hot start-up in high tech, biotech, or health sciences. Garage.com expects to close on 30 deals culled from a projected 10,000 business plans to be submitted by the end of the year. Fee: Typically, 5% of money raised. Garage.com also buys a small stake in the company at the “pre-deal valuation” price. –S.G. On the auction block Ian Zwicker, President WR Hambrecht & Co. OpenIPO Launched: 1998 What OpenIPO is: A process by which WR Hambrecht & Co., an investment-banking firm, takes companies public by auctioning shares over the Inte