Let’s play Rip Van Winkle.
Assume you had a great dot-com business idea but fell asleep sometime during the Clinton Administration. You wake up and decide to get busy. The question is: Can you still get the support you need to make your dream a reality?
The answer is a qualified yes. All it will take is your soul.
John Thomas is the director of a program called WebAccelerator, which is taking applications for its e-incubator program through February 2. He works at Epoch Network, a Web-hosting firm. Other members of the program include Satellite Marketing International, IBM, the Silicon Valley Bank, Deloitte & Touche, and O’Melveny & Meyers. In all these together you have all the knowledge, expertise, and contacts you need to get going — funding, legal help, accounting, technology, marketing, and Web hosting.
Thomas even has that spirit we haven’t seen since 1999. “We’re trying to build long-term relationships with companies that need to leverage our infrastructure,” he said. (During our brief talk this was one of his calmer, simpler sentences.)
Epoch helped launch the program last year and already has 50 companies participating. Thomas said he’s presently adding 15 more companies to the program and planning an expansion into Dallas.
Now no one does this kind of thing out of the goodness of his or her heart. (These are the Bush years, remember?) Thomas has some big hosting centers he needs to fill, and servers are a bit like airline seats. A server that flies empty doesn’t make money.
Still, you have to be careful. All the WebAccelerator companies are evaluated carefully at each step of their journey into the market. “Key indicators are, Can you get the next round of funding, can you sustain yourself in this climate,” said Thomas. In other words, are you a good investment?
What the partners get out of this is a regular flow of business with bright companies that might become winners. Epoch signs one-year contracts with the newcomers and gives away the first six months of service. In addition to hardware, software, and training, IBM pushes back amortization of its equipment and provides front-end funding and marketing support. Other members of the team come in as needed.
So it’s possible that our sleepy-headed entrepreneur (let’s call him Skip Van Winkle) can get funding for his Internet-based bedding store, cyber-bowling shop, and brewpub. (It’s a brick-and-click strategy.) The cost will be, in addition to equity, all his decision-making power. His new operation will be tied to its hardware, Internet service, and professional services suppliers tighter than a new baby on its mother. Skip’s chances of breaking those apron strings are no better than the baby’s.
I’m not criticizing this, although it may sound like I am making light of it. In fact this is a real good news story, proof positive that you can get to market right now, in 2001, with a new Internet start-up. It’s just not like it was. Businesses have figured out the start-up process and even built a little factory to support it, hoping the sausage coming out will taste as sweet as it did in those freewheeling days of the late 20th century.
Let’s hope it does.
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