Dotcom Divas: E-Business Insights from the Visionary Women Founders of 20 Net Ventures

Overview

Industry insider Elizabeth Carlassare provides an in-depth, behind-the-scenes perspective on the specific strategies each company has employed and the key lessons each founder has distilled from her Net startup experience—invaluable insights for experienced and aspiring entrepreneurs alike. You'll get an inside look at:
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Overview

Industry insider Elizabeth Carlassare provides an in-depth, behind-the-scenes perspective on the specific strategies each company has employed and the key lessons each founder has distilled from her Net startup experience—invaluable insights for experienced and aspiring entrepreneurs alike. You'll get an inside look at:
  • How winning e-business ideas are developed.
  • Twenty innovative e-business models.
  • How to get financial backing for an Internet business.
  • The challenges Net entrepreneurs face and how to overcome them.
  • How to create an Internet offering that “wows” customers.
  • Successful strategies, tactics, and marketing techniques.
Although they’re just a tiny fraction of the thousands of women who’ve launched successful Web-based companies, these entrepreneurs hale from stunningly diverse backgrounds. And their business models display as much variety as they do: from financial disclosures to pet products, B2B e-markets to online communities, and email marketing services to Net infrastructure. You’ll meet the businesswoman who had already created companies in New York and Lithuania before launching a high-tech Silicon Valley startup, the single mother who revolutionized an industry, and the woman who, after buying a gift on Amazon.com, stopped being “an entrepreneur waiting to happen” and created a brand-new type of Web business. All of these twenty-first century heroines share an enterprising mix of courage, intelligence, business savvy, and just a little luck. In Dotcom Divas, they reveal their hard-won business wisdom and practical advice to help you make smart decisions and avoid common pitfalls. Whether you’re an entrepreneur or Internet professional, or just dreaming about starting your own business, their stories will ignite your own ambitions and inspire you to turn them into a reality that just might click.
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What People Are Saying

Ellen Hancock
Carlassare takes a fascinating look at the intense entrepreneurial drive of the women behind some of today's leading Internet businesses. It's an education on lessons learned and strategies for success in the digital economy.
—Ellen M. Hancock, Chairman and CEO, Exodus Communications
Guy Kawasaki
Read this book and learn why ‘two guys in a garage’ is outdated thinking. A must read for anyone, male or female, starting a Web business.
—CEO, Garage.com
Heidi Roizen
Not just for women, Carlassare’s book is a must-read for all budding entrepreneurs. She has distilled the keys to entrepreneurial success — tenacity, vision, flexibility, the importance of building a great team as told by the drivers who have done it themselves. Highly recommended.
—Managing Director, Softbank Venture Capital
Myra Hart
Powerful proof that the doors and windows of opportunity are open to talented, energetic, and persistent people. What a refreshing change that these entrepreneurs happen to be highly qualified women who have seen the possibilities and seized them.
—Professor of Management Practice, Harvard Business School
Stephen R. Covey
No longer are female entrepreneurs anomalies in today's market. This exciting book follows some remarkable women doing remarkable things on the Internet. Move over and watch these women go — but more importantly, learn from them.
—Stephen R. Covey, author of the #1 bestseller, The 7 Habits of Highly Effective People
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Product Details

  • ISBN-13: 9780071362429
  • Publisher: McGraw-Hill Professional
  • Publication date: 12/6/2000
  • Pages: 274
  • Product dimensions: 6.22 (w) x 9.25 (h) x 0.94 (d)

Meet the Author

Elizabeth Carlassare is an Internet strategist with more than ten years of experience at high-technology companies, including Adobe Systems, Intuit, and SGI. She's a member of the founding team of MyWebtivity, Inc., an Internet startup based in Silicon Valley, and a personal and professional coach for women in technology. She's also the creator of dotcomdivas.net (www.dotcomdivas.net), a Website for women Internet entrepreneurs. Email her at elizabeth@dotcomdivas.net.
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Read an Excerpt

1. Astronet

A ROCKY START

There's an age-old saying that when a door closes a window opens. This adage is especially true for the eclectic, arty Eugenie Diserio. She founded Astronet, the most highly trafficked astrology Website anywhere, which today is part of Women.com Networks. Astronet offers cosmic counsel on love, relationships, money, careers, and even issues important to teens. Known online as "Genie Easy," Diserio is a wizard at transforming setbacks into new possibilities and opportunities. In fact, Astronet would never have come to be if Diserio hadn't faced one particularly difficult situation.

In 1992, after the breakup of a five-year relationship, Diserio returned home to New Canaan, Connecticut, with her four-year-old son, Jake, and moved back in with her mom and dad. She was down on her luck and depressed. Recalling this period of her life, she says: "I'm someone who's graduated from the school of hard knocks with a definite Ph.D." In an effort to survive financially, she started a new job as an executive assistant (or as she puts it, a "glorified schlepper") at a company called New Sub Services started by Jay Walker-now notorious for the wild success of his current company, Priceline.com. Corporate culture was completely foreign to Diserio, who had spent the bulk of her career as a singer, songwriter, and recording artist pioneering New Wave music in the early and mid-eighties. She had been in two bands-Model Citizens and The Dance-which toured internationally and regularly played at popular Manhattan dance clubs such as CBGB, which helped launch alternative groups like the Talking Heads, Television, and Blondie. But after Jake was born in 1989, Diserioleft the music business-the late nights and the chaos of a performer's life didn't mesh well with motherhood.

So, at New Sub Services, Diserio felt like a fish out of water working nine-to-five for a paycheck to support herself and her son. But a staid corporate career wasn't in the stars for her. After only 18 months on the job, she was laid off when her division was unexpectedly downsized. Diserio began collecting unemployment compensation and looking for a new corporate job, but her efforts didn't result in any offers. "With my creative, performance-oriented background, I didn't fit in anywhere and I felt too old to climb the corporate ladder," remembers the 46-year-old entrepreneur.

A FATEFUL READING

One of Diserio's lifelong passions was astrology. "I was in graduate school when I had my first chart done by a professional," she says. "It was $75, and I thought that was so expensive then. But I remember thinking the insight it gave me into myself was cool!" Seeking guidance after the layoff, she ran her own astrological chart (she's a Libra with Aquarius rising). Despite her difficulty finding employment, the planets were aligning favorably in her career house. Encouraged, Diserio decided to capitalize on this positive force and began brainstorming business ideas. Determined to craft a successful venture and survive financially, she read about how to start a business and met with seasoned entrepreneurs through her local Chamber of Commerce to learn the ropes, all the while keeping her eyes peeled for an unfilled niche.

Before Diserio left New Sub Services, a coworker with an AOL account introduced her to the Internet. Now, as a budding entrepreneur, Diserio decided it was high time to learn more about the new world emerging online and scope out the possibilities. She bought herself a 14.4-baud modem, plugged it into her Mac SE, and got her own account on AOL using the handle "Genie Easy." She recalls: "I wanted Genie of Love-the title of one of my favorite self-penned songs-but it was already taken, so I signed up as Genie Easy and it stuck."

During several early online romps, Diserio made a discovery that would soon change the course of her life: "The Internet at that time was a virgin idea and truly the Wild West. Using free trial accounts on Delphi, GEnie, and CompuServe, I went out on the Internet and discovered that many, many people in online forums were interested in astrology." It was this realization that inspired her to create a Web-based astrology business with the intention of building it into the premier astrology brand online. Given Diserio's longstanding fascination with astrology, her entertaining charisma, and her talent for giving advice, a Website about astrology was the perfect fit.

Convinced that she had the right stuff to build an online astrology business, Diserio crafted a business plan and presented her idea to several East Coast angel investors and venture capitalists. But this was 1994 and VCs weren't accustomed to hearing about businesses built around horoscopes and metaphysical consultations. Moreover, most equity investors at that time viewed the Internet with uncertainty. Diserio boldly made her unconventional pitch time and time again with no bites. She says, "Venture capitalists were like, `An Internet business about astrology by a woman? Hello!"'

INCUBATION IN THE "GREENHOUSE"

While it was clear that her cyberastrology vision was ahead of its time, Diserio's instincts and the planets told her that the business would succeed if she kept at it. Undaunted by her unsuccessful efforts to secure funding, she turned to the America Online Greenhouse, AOL's business incubator, which made small equity investments in the ventures of Web "infopreneurs" willing to develop content for the AOL service.

Diserio's decision to approach AOL was right on the mark. "I relentlessly pursued Ted Leonsis [AOUs longtime marketing magician and president of AOL's Interactive Properties Group] and after many pitches to the Greenhouse team I was chosen as one of the first ten entrepreneurs they funded out of more than 2000 applicants," she explains with pride. As part of the AOL Greenhouse, Astronet was in excellent company: BetterHealth (now part of iVillage); NetNoir, a highly trafficked destination site for African Americans; and the popular Motley Fool are just a handful of the successful businesses initially incubated by the Greenhouse.

Astronet was funded in the nick of time: Diserio received a seed investment of $150,000 in May 1995 just as her unemployment money was running out. Her credit cards were maxed out and she was prepared to accept an entry-level position at Prodigy if the money for Astronet didn't come through.

A COSMIC COUNSELOR IS BORN

Encouraged by AOL's vote of confidence, Diserio set up shop in her parents' basement. She bought computers and office equipment, and hired an assistant and Web producer who knew Rainman, the proprietary language used to build Web pages on AOL. She sought out the best astrologers from around the nation, bringing editors of top astrology magazines, the owners of astrology software companies, and celebrity astrologers-such as the Cosmic Muffin (well-known for his Bostonbased radio show)-into the Astronet fold. "I like to think of Astronet like Woodstock-you put all of these different people up on stage and watched it come together," says Diserio.

She hung out in AOL chat rooms to recruit a herd of volunteer chat hosts willing to work in exchange for free AOL accounts. For employees on the payroll, there were other perks. Even during these humble beginnings, Diserio ran the business as a true Web company, awarding employees stock options as part of their compensation packages. It wasn't long before she had five part-time employees working in the basement.

Managing a startup was new territory for Diserio, who had earned an MFA from Columbia University in the late seventies. But her father, an attorney and businessman, offered solid financial and management advice, as well as encouragement, as she built the business to the point where she could hire a chief operating officer. "My dad helped me do my books and gave me great advice on people and strategy," she says. Does she feel that her lack of an MBA held her back? Not at all: "Good instincts matter more. A lot of the entrepreneurs who are making it in the Internet world don't have a traditional business background because so much of it is about rule breaking."

Six months after the business was funded, Astronet first launched under the sign of Scorpio on November 13, 1995. (Astronet's astrological chart hangs on the wall near Diserio's desk, next to hers and her son's.) At its launch, the Astronet site on AOL (keyword "astronet") offered a variety of specialized horoscopes including ones focused on love, career, money, and eros, as well as psychic, tarot, and astrology readings offered either online or by phone.

SUCCESS WAS IN THE STARS

Soon after Astronet's AOL launch it was clear that the site was a hit. Astronet had hoped to have AOL users spend 25,000 hours in the Astronet area within the first few months after the launch, but the company achieved this goal within its first 30 days. "We didn't even promote Astronet that much," says Diserio. "We simply provided something people really enjoyed." Astronet's traffic continued to top itself month after month, and the site twice received the AOL Member's Choice award.

In the summer of 1996, with Astronet's monthly traffic growth rate in the double digits, AOL further fueled the site's meteoric rise in popularity with a second-round investment of $750,000. Diserio used this infusion to hire an executive staff and move Astronet into a building in downtown New Canaan. This second investment brought AOLs equity stake in Astronet up to 33 percent. How did Diserio feel about handing out such a large chunk of her company's equity to AOL? "It was fine by me since it was their investment and support that got my business off the ground at such an opportune time in the Net's history," she says...

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Table of Contents

Part 1: Portal, Content, and Community Ventures.
Astronet.
AudioBasket.
eSampo.com.
iVillage.
LookSmart.
ThirdAge Media.
Part II: Web-Based Services Ventures.
Desktop.com.
EDGAR Online.
E-Loan.
NetCreations.
Part III: E-Commerce Ventures.
Della.com.
Eve.com
oneNest.
Petopia.
Sparks.
SuperVertical.
E-Business, Applications and Web Technology Ventures.
CoVia.
eCommerce Industries.
Marimba.
RightWorks.
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Foreword

As someone who has worked for 22 years in information technology and, more recently, as a leading e-business consultant, I was flattered when Elizabeth asked me to preview her book. It's great to read so many fascinating stories about gutsy women who have risen to the challenge of this vibrant new economy.

The dotcom businesses you're about to discover range from financial disclosures to astrology, pet supplies to 13213 e-markets, email marketing services to online communities, and Web applications to Net infrastructure. Twenty different businesses, with almost as many different business models. Each one took an amazing amount of chutzpah, some luck, and a lot of hard work.

What impressed me most about the stories you're about to read is the variety of creative ideas these women brought to life, and the dedication and passion with which they pursued them. I found it refreshing to learn how these women spread out across three continents-balanced their work and personal lives. This is a dimension that's usually left out when you read about male entrepreneurs and their triumphs and tribulations. Some of them partnered with other people, but each was a key driving force behind her company's success. Many raised money while they were pregnant, launched new products as they were giving birth, and kept up the blistering pace required to nurture a new company into adolescence while balancing home and family.

How did these dotcom divas fund their businesses? You'll learn about a wide variety of successful approaches. Some of these brave souls bootstrapped their startups, drawing on their own resources--credit cards, second mortgages, life savings. Othersconvinced private investors and "angels" to help them get off the ground. Many went the venture capital route. (It's encouraging to note that venture money was available to these women entrepreneurs, although it took imagination and guts to land it.) A few have already taken their companies public. And as the founder and owner of a successful,15-year-old privately held consulting firm, I was delighted to see that several of the entrepreneurs opted to keep their companies private-a satisfying choice that is too often overlooked in the traditional business press.

How successful have these entrepreneurs been in recruiting top talent? Very. And, as you'll soon learn, the techniques they used to pursue the key players they wanted on their team were imaginative and persistent. For example, iVillage's Candice Carpenter and Linda Evans repeatedly wined and dined one reluctant recruit until she finally saw the light. When another candidate slipped through their net and took a job at a different firm, they intercepted him in a rented car after his first day at work and pitched him again all the way to his home. The seduction worked. Whether they were recruiting software developers or marketing professionals, these women used the most persuasive recruiting tool on the planet-their personal enthusiasm and passion for their burgeoning businesses.

One of the things that's particularly perverse about launching and shepherding an e-business to success is the constant morphing process. Internet businesses are notoriously slippery beasts. You start out with a focused product or service and a business model that seems to make sense, and, in the space of 12 months, you find that you've changed your product design three times and your business model at least twice. As one young but seasoned business executive explained to me after he'd embarked on his first dotcom, "Every time I think I know what to do, I realize that I can no longer trust my business instincts and judgment. Instead, I have to let go, and let my customers design my business."

How have the savvy women profiled in Dotcom Divas evolved their Internet businesses? With great agility. All the stories you're about to read are packed with dead ends and new beginnings, transformations and acquisitions, and shifts in focus. For example, Rosalind Resnick's NetCreations began life as a company developing Websites, then morphed to offer a service that let Webmasters register their sites with popular search engines, and then transformed again into a very successful permission-based email marketing company. Veronica Allende Serra's Brazilian auction site, Superbid.com.br, quickly evolved from consumer auctions offering good deals on home appliances and computers to a business-to-business infrastructure platform for a variety of vertical marketplaces. And these are just two of many examples. You're about to read story after story of changing business models and directions. But notice that, in each case, as these dedicated women followed their dreams, they let their customers lead the way.

Patricia B. Seybold

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