Since the recent fall of the Nasdaq I’ve heard it and heard it. “We’re not like those public companies.” “We have private capital, patient money, and we’re focused on long-term value.” “We won’t rip you off.”
Uh, huh. That last sentence probably had you reaching for your wallet. (I keep mine in my front pocket, just in case.) But there’s an important lesson here: Capital hasn’t dried up, and the waning of the fast buck doesn’t mean no one’s doing business anymore.
One of the more interesting versions I’ve heard of this story comes from Groundswell Inc. of San Francisco. They’re not just up-to-date in claiming patient money (Behrman Capital put in $100 million last year) but in the technology pitch offered by COO John Corpus.
Most outfits want to be the Yahoo of this or the Amazon of that some want to be the Internet Capital Group. Corpus wants to be the KPMG of the Internet.
Basically, Groundswell is building business communities. “Public Storage has asked us to do a site called Totalmoving.com,” Corpus noted. The site pushes the moving and storage company’s products with a “wizard” program for calculating your moving and storage needs.
Another typical Groundswell joint is Carstation.com, launched for the auto collision industry. Here, “the real accent is on the B2B component, bringing together all the companies involved collision repair and service.”
Not all of these new sites run on the public Internet. Some are business-to-employee, or B2E plays. For instance, Corpus says, “We’re doing a sales and marketing community for FedEx. It was started to help salespeople become aware of corporate events. This lets them find those events and act upon them for clients. It’s been expanded to include more areas. The user in this case was the sales team.”
Building any organization like this takes some clever recruiting, which Corpus is doing. “Anyone who refers someone to us gets a ping pong ball, and every six months we do a drawing, so you can get prizes from wine and bikes to trips to Hawaii and Costa Rica. The grand prize this time was a trip to the Sydney Olympics.
“It speaks to our culture. We don’t just give money to hires. We want everyone to have an experience.”
Corpus’ PowerPoint shows Groundswell as a “pure play” combining creative, strategy, system integration and business operation expertise. That puts it in direct competition with such outfits as Scient, Organic, Proxicom and Viant. The idea is that big operators bring their Internet plays to one of these shops and get an intelligent, functioning business.
Making that happen requires some technology partners. In Groundswell’s case they include such outfits as BEA Systems, Broadvision, OnDisplay, iSyndicate and Mercury Computer Systems.
These kinds of floating alliances, when put together by outfits like Groundswell, should give anyone with capital the strategy, tactics and execution they need to hold their niche in the next few years, or so Corpus hopes.
That’s important to remember, when you look at big, “meat space” competitors and call them clueless. Maybe they are. But street smarts like content, tactics, integration and strategy have economic value and can be bought. The fall of the Nasdaq won’t change that.