InformationWeek
Defining The Business Value Of Technology
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January 1, 2001 |
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DotCom Divas
continued...page 3 of 3
By Elizabeth Carlassare
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Because of the tremendous visibility the founders generated by leaving the Java team en masse, they had the unusual luxury of being able to pick and choose from among the best venture-capital firms. They made appointments with several VCs that had already contacted them while they were creating the Castanet prototype.
"We had a solid business plan and a very comprehensive presentation that really articulated what the company was doing," explains Polese. "When we went out and talked with investors, we were very clear about the company's mission and why it was going to become a big business."
Their focus and vision shined through, and, in August 1996, Kleiner Perkins invested $4 million from its Java Fund in the startup, making Marimba the first company to receive money from the new fund.
FELICIA LINDAU
Driving home from work late one summer night, Lindau was congratulating herself about the great gift she'd purchased when she realized she hadn't bought a card. The drugstores had closed, and paper cards weren't available on Amazon.com. There was no way she'd be able to send one in time. But happily, this moment of frustration led to inspiration. "Intense and sudden inspiration," says Lindau.
Her inspiration was so overwhelming that she had to pull off the road right then and there as the entire vision for Sparks.com flashed before her eyes. "My head felt like it was about to explode with all the possibilities. My whole body heated up," she recalls. "I grabbed a piece of scrap paper from my messy car floor and starting mapping out the whole idea. I'd say that 90% of our present business model came to me in that one instant."
This was the genesis of Sparks.com--and a new consumer E-commerce category. What happened next typifies the sturm und drang of launching a hot new Web startup--marketing hurdles, technical challenges, and marathon bouts of pitching to VCs.
Getting the business off the ground. Inspired by her vision, Lindau was raring to launch the business. She was 31 at the time and had already racked up 11 years of experience as an advertising and marketing professional with an Internet-heavy resumé that would give any Silicon Valley headhunter goose bumps. Her experience in technology marketing, and as a dutiful card and gift buyer for family and friends, made her certain that the Sparks.com concept was the right opportunity, and that she was the person to seize it.
After taking a UC Berkeley night class on how to write a business plan and raise money, she crafted a plan full of relevant data, which she knew like the back of her hand as a result of her work on an Amazon.com account, and then she fearlessly quit her job [at ad agency Foote, Cone & Belding]. "I was so impassioned by my idea that I was more afraid not to do the business than to do it," she says.
Lindau enlisted friends who were excited to sign up for the high-risk, high-reward opportunity that Sparks.com offered. Lindau called Jason Monberg, a longtime friend who was a lead engineer at CKS, an interactive design agency. Although she'd called to get his advice about the technical costs of launching Sparks.com, she was amazed when he volunteered that he was ready and willing to abandon his fast-track career and join forces. Lindau jumped at the chance to bring him on board as co-founder and chief technology officer. She knew his technical talents were top notch because she'd seen them in action--they'd worked together several years earlier as founding members of the Interactive Group at Anderson and Lembke advertising.
So Lindau and Monberg incorporated the company in May 1998 and began developing the Web site, back-end systems, and marketing plan. Lindau hired her sister to head up customer service, as well as a card buyer to establish relationships with card publishers. With Monberg focused on the technical details, Lindau was free to work her marketing wizardry.
Calling on friends, family, and ý benchmark. That fateful spring, Lindau approached her friends and family members to find out whether they knew of potential investors or were interested in investing themselves. Her progress was swift: By June 1998 her mother, a friend's father, and a software supplier who wanted to land Sparks.com's business had contributed a total of $250,000. Next, she hired a contract CFO to help her raise funding, since she had few, if any, contacts in the capital community.
She and her temporary CFO identified the best venture-capital sources and began pitching to them relentlessly. "We must have sent the business plan to 100 angels and VCs," she estimates. "I must have made 100 calls a day."
Lindau recalls that she did encounter some overt gender bias while seeking funding. "One VC advised me to get a 'front man,' and then went so far as to fax me the resumés of potential candidates," says the CEO. Determined to carry Sparks.com until the business secured funding from institutional investors, she took out a loan against her house. Finally, after six months, a prospective Sparks.com partner introduced her to Kevin Harvey at Benchmark Capital, who in turn introduced her to Bob Kagle, who, seeing a bright future for gift-related portals, decided to invest. Together, Benchmark and Venture Strategy Group closed a $3.5 million first round of financing for Lindau's new company.
Building a Web site with an intuitive user interface and first-rate customer experience is tricky enough, but accurately shipping thousands of cards each day to the correct recipient from the correct sender is a major hurdle. But under Monberg's technical leadership, the company was able to tackle these challenges and launch the site on Dec. 10, 1998.
So what inspired the Sparks.com name? At first, Lindau wanted to name the company Jot to highlight the site's convenience, but the name didn't go over well in focus group tests. Testers preferred a name that emphasized developing better relationships. So Lindau chose Sparks.com, which refers to the "spark" between people when they connect emotionally.
From DotCom Divas: E-Business Insights From The Visionary Women Founders Of 20 Net Ventures, by Elizabeth Carlassare. Copyright (c) 2001 by Elizabeth Carlassare. Reprinted by permission of the McGraw-Hill Cos.
Illustration by Amanda Duffy
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