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Netpreneurs Turn to Nighttime Networking

(Washington, DC -- September 30, 1997) Coffee & DoughNets became Beer & PeaNets as the Netpreneur Program's monthly networking event moved to a nighttime venue for September at the DC ANA hotel. An impressively-focused brainstorming and business problem-solving session highlighted an evening of personal networking, socializing and enlightening discussion.

The Set-Up

In front of a film crew from NBC Nightly News, here to do a story on the region's burgeoning entrepreneurial future, Penny Lewandowski welcomed attendees and recalled the progress the Netpreneur Program has made. She recalled the early days of the Program, comparing tonight's capacity crowd of 185 (many people had to be turned away because of room limits) with an earlier gathering at the Tysons Sheraton Premiere of 45 friends and colleagues where the Netpreneur Program was first introduced. Tonight's attendees were asked how many attendees were familiar names and faces, and whether anyone could have imagined the difference one year would make.

Penny highlighted the Netpreneur Program's work with the Mid-Atlantic Venture Association, New Horizon Financial and EDIE-Online, offering regional netpreneurs the opportunity to make virtual presentations to investors at the MAVA Fair, (http://netpreneur.org/events/mava), offering 90 days exposure to 600 venture capital firms and private investors for the bargain price of $150! As Penny said, work the math...it's a pretty good deal! [The fees do not go to the Netpreneur Program.] She also described the upcoming October 21 Evening with the Stars of Telecom (http://netpreneur.org/stars) for which over 500 have registered. The Evening With The Stars will feature five founders and co-founders who represent nearly every facet of the telecommunications industry-Morgan O'Brien of Nextel Communications, Inc., John Puente of Orion Network Systems, Brian Thompson of LCI International, David Thompson of Orbital Sciences and Mark Warner of Columbia Capital Corporation -who will answer audience questions about starting an entrepreneurial venture in this highly-competitive industry and how they made it to the top.

Penny then introduced Mario Morino, who greeted the audience holding a "BeerGuy" t-shirt from a California microbrewery that sells beer on the Internet. Mario noted the beginning of a new trend-this California company coming to our region for entrepreneurial advice.

Mario talked about the recent mega-transaction between Compuserve, AOL and UUNET as a Silicon Valley-type deal, the result of a thriving social fabric in which players know each other and can meet over breakfasts or where ever, to brainstorm win/win ideas. It's a new style for our region, but one that is growing and clearly reaching a critical mass. Mario does not see DC as another Silicon Valley-known for computer hardware and software-- but, rather, as a place of convergence for the pipes, processing and content. He says the region shows a significant and growing presence in all of the network communications sectors, with a dominating position in the "bookend" technologies of telecommunications and content. Analysts are beginning to realize that DC owns these bookends: telecommunications and infrastructure, spanning traditional and wireless technologies, strengthened by deregulation, and stretching from Lynchburg to Baltimore. Content, being intangible, is often neglected in assessments of industry presence, but government, library, association, health, technology, and a myriad of other categories make the Washington Netplex a diverse and rich source of present and near-term electronic content.

Success Stories

Mario turned the floor over to a parade of netpreneurs from the audience who shared their recent successes.

  • Dolores Ebert of Atlas Employment (http://www.hers.com/atlasemp/) runs the oldest local employment agency, founded by her parents in 1940. She recently placed a senior person from New Orleans, in a job in Tulsa, for a Bethesda-based client, via the Internet. "I'm sold, I'm here to learn" she remarked.
  • Julie MacKinnon of superSonic Boom! (http://www.supersonicboom.com) reported that they are near their first venture deal, will exhibit at MAVA and have been covered by Billboard magazine, the Washington Times, and Washingtonian Magazine. Supersonic Boom, which markets custom CD compilations over the Web and offers a jazz catalog, has made many of these contacts via Netpreneur activities.
  • Susan DeFife of Women's Connection Online called the DC area an untapped but vibrant and promising community; WCO is adding e-commerce offerings to existing online advertising and affinity services.
  • Peggy Miles of Intervox Communications (http://www.intervox.com), which provides Internet broadcast and project management, reported an impressive, globe-spanning array of recent conferences and client visits.
  • Paul Albert of RouteLink (http://www.routelink.com/) -- a service which matches shippers and customers-has hired several top-notch experienced executives.
  • Ross Stapleton-Gray of TeleDiplomacy, Inc. (http://www.embassy.org) was interviewed for 45 minutes on CSPAN and will help organize the 1999 Computers, Freedom and Privacy Conference in Washington.
  • Doug Carmichael of Metasystems Design Group (http://www.tmn.com) supports learning environments and is partnering with a major 50-year old technology company
  • Shelton Jewette of Computers 101, Inc. trains new computer users, and was surprised at being covered in the Post business section a day earlier than he expected.
  • Hank Dearden is helping organize the NetExpo being held at the Washington Convention Center next week.

Mario remarked that with the amount of success described (and attributed to the Netpreneur Program), the meeting could have ended right then and still have been valuable. He noted the astronomical growth in the DC-area entrepreneurial community demonstrated by the growing number of meetings and resources, such Beer & PeaNets, FastTrack, Night Owls, Storyboard and the Greater Baltimore Technology Council dinner-even the Stars of Telecom event shares an evening with gatherings at the Dingman Center and the MIT Enterprise Forum.

Many Minds On The Challenge

The focal point of the evening turned out to be a presentation by Lisa Amore and Jennifer Jaasma of TV onthe WEB; they presented a marketing challenge, hoping to mine the minds of other netpreneurs who have faced similar challenges. The presentation was so successful, from both the audience's perspective and TV onthe Web's, that similar presentations will become a regular feature of future Coffee & DoughNets.

Recognizing the friendly and collegial setting, the presentation was structured to describe the company, identify opportunities, note problems or obstacles, and invite the audience to collaborate in brainstorming solutions. It was clearly a gutsy maneuver to expose uncertainties and questions to 185 people and the working press, but Lisa and Jennifer were not disappointed.

The Background
TV onthe WEB originated as a video production rather than Internet business. But a recent deal with PSINet/PSIWeb and adoption of net technology has led to both and a challenging business situation. They offer live video streaming over the Internet, targeting businesses in the $1-5 million range, especially those without in-house IT departments to arrange and manage Internet services. So they face the challenge of marketing an outsourced, value-added service. Many prospects have Web sites to satisfy customer expectations or to match competitor actions, but haven't yet seen adequate (or any!) return on investment, and are reluctant to up the ante by adopting yet another technology. Sometimes worse, executives see video as purely entertainment, so TV onthe WEB must demonstrate that multimedia can satisfy business needs and provide real financial payoffs.

The Challenge
Their challenge is capturing an audience who understands the business potential of Net but doesn't want to pay directly for and manage high technology. In this direction, they are collaborating with the Cato Institute on October 14 to host an Alan Greenspan pay-per-view presentation -- hardly consumer "entertainment." Their marketing campaign includes: press campaigns, on-demand video broadcast events, highlights in Telephony magazine. They've also worked with the White House. Historically DC-focused, they are expanding their target, working with CEOs wishing to exploit the Net and technology staffs to sell internally to marketing organizations.

The Ideas The audience jumped in enthusiastically:

  • Quantify the bottom line offered by using technology; ROI is king-without it, there's resistance to adopting new technology. Do the buyer's job regarding technology assessment, feature analysis, ROI calculation, assuming nothing on their behalf. Identify current video users, demonstrate physical cost savings.
  • Find customers with aptitude to view video. Find products which video enhances, such as technical products which people want to see visually illustrated. For example, nuclear submarines are clearly serious, not entertainment.
  • Approach training departments and associations, human resource managers, distance learning organizations, Web training users-conference sessions on these topics have been packed.
  • Don't focus exclusively on corporations. Look at organizations such as the US State Department and arrange a demonstration for the personnel department.
  • Compete by comparing costs with current alternatives-digital video conferencing can cost $12,000 or more per location. Demonstrate how the technology facilitates competing with big players, appearing larger than life.
  • Identify 10 companies, solve 10 problems -- then build on the successes.
  • Package video streaming as a branded product, be sure to emphasize benefits (financial, marketing, competitive) not purely technology. Avoid appearing as a technical solution seeking a problem, or as just another run-of-the-mill Net marketing toy.
  • Partner with advisors/contractors -- for example, "follow" sales of high-bandwidth communication facilities by offering streaming video as a technology which exploits and justifies the fast connection. Explore relationships with hardware/software package vendors, an bundle services.
  • Focus on education. Examine Web consortium (W3C) work on metadata in learning objects: subject/price/learning objectives.
  • Seek other distribution vehicles beyond direct to customer, e.g., Web developers, other channels.
  • Partner with major business publications, matching content and technology, targets such as Inc and Forbes magazines.
  • Exploit existing content via non-profit organizations, libraries and such, to offer the massive inventory to public and industry consumers.
  • Drill through to identify customers' customers -- how can the technology make TV onthe WEB customers look good to their customers? Quantify benefits and improved perceptions. Identify viewers for proposed content, and find business value. Understand whether a prospect targets an external or internal audience. Meet the challenge of closing sales, taking interested prospects to done deals: educate, motivate, demonstrate. Find business executives with vision and boldness to innovate with leading-edge technology.
  • Target event managers and integrate into conference deliverables.
  • Market/sell/refer within vertical industries. Banks, for example, will ignore technologies used by the Navy, but will respond to competitor actions.
  • Find businesses with large internal TV use, such as SAS Institute (large, high-end software company), etc.
  • Find a way to get into prospect doors, perhaps using a marketing hook-offering a free "audit," promising to improve communications capabilities and utilization.
  • Target companies like Women's Connection Online communities for broadcasts; seek corporate sponsors for broadcasts on WCO. Taylor Walsh of Onsite Interactive (http://www.onsite-interactive.com) told a cautionary tale: they thought they had a committed customer, but the sale never happened. In hindsight, there was nobody clamoring inside the prospect orgnization for the product. If it was attempted and failed, the purchaser would be very negatively exposed. On the other hand, if it was never attempted, it would not be missed. The message was to ensure an internal evangelist before a prospect reaches a buying decision.

    Finally, questions were asked regarding price and target market. TV onthe Web chose the $1-5 million segment because they believe larger companies will implement the technology themselves. Upon hearing that a five-minute broadcast might cost around $175/month, many in the audience thought that the price was too low, understated value and confused prospects about potential payoff. Many suggested more aggressive pricing.

The Wrap-Up

In last-minute discussion, Ross Stapleton-Gray suggested that the Netpreneur Program facilitate a "barter board" for netpreneurs to exchange needed services, expertise or even equipment, such as one netpreneur who needed the use of a projection unit in order to make an upcoming presentation. The Program team is already exploring options for this idea.

Jim Buie mentioned his recent Washington Post Outlook section article on neighborhoods online. A related article about a local electronic magazine was written by Jeff Itell. Mario mentioned several areas profiting from local connectivity, including Charlotte's Web, housing projects being wired, and an effort in Hartford, CT requiring at least one family member committing to Net activities. An author indicated that a book is in process on online communities, and dcregistry.com was mentioned as a local community hub. Mario noted that community building is a long and arduous process, but that sustained efforts build long-lasting results.

One attendee compared tonight's meeting and discussion format to Interboard's Storyboard program, which allows netpreneurs to preview their corporate presentation, get feedback and tune up their story before taking it on the road. Other resources noted were third Tuesday monthly MIT case studies presented at the NSF Ballston office, and the Dingman Center program (http://netpreneur.org/advisors/dingman) for reviewing business plans.

As the meeting ended, audience members lingered for final chatting. Dan Solomon of Net.Capitol, Inc. (http://www.netcapitol.com) remarked, "NetCapitol produces Internet applications for the political and public affairs market. I attend Netpreneur Program events to meet potential partners and find people to work with us. Tangible results have come from prior gatherings, and I expect the same thing from this evening."

Lynne Filderman of JumpStart Communications, (http://www.dcorbit.net/), which represents a network of DC-related Web sites, reported substantial payoff from earlier meetings. "I targeted a number of people that day. I continue to have business relationships with several who have connected me to some people who have become my current clients."

Copyright 1997 Morino Institute. All rights reserved. Edited for length and clarity.  

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