Archive for the ‘Press’ Category

EGroups Fires CEO – September 21, 1999

July 9, 2010

Short Take: eGroups CEO steps down
By Jim Hu
Staff Writer, CNET News.com
September 22, 1999, 4:10 p.m. PT

Community Web site eGroups announced that its chief executive, Martin Roscheisen, will take a leave of absence from the company. Roscheisen is expected to return, but he will only play a strategic role, the company said. Venture capitalist Michael Moritz of Sequoia Capital will serve as chief executive until a new one is appointed.

Easing The Pain Of E-Mail Lists – San Jose Mercury News

May 26, 2010

By David Plotnikoff
Knight Ridder Newspapers

If you were to ask a dozen amateur investors what images they associate with the term “Internet start-up,” they’d most likely wax eloquent about daring young geeks racing round the clock to create new models for commerce, content and community. That and the potential for stock performance approximating that of a Saturn V rocket.

In point of fact, some of the most successful Internet entrepreneurs never introduced a paradigm-shifting, category-busting breakthrough product or service. What they did is provide pain relief — solutions that would help people cope with the abrasive, non-intuitive and downright maddening shortcomings of existing technology. This concept, which Net publishing pioneer Tim O’Reilly termed “information pain,” continues to be an ubiquitous presence in our digital world. You can bet your 401(k) that there will always be people struggling with technology — people who will pay dearly for that better digital mousetrap.

Consider e-mail lists, a tool for group communication that’s been around almost as long as the Net itself. E-mail lists are a lowest-common-denominator platform for virtual communities — cheap, durable, downright dowdy technology that’s been overshadowed for years by flashier tools such as real-time chat and people-finders. While most sectors of the Net have undergone a nearly complete metamorphosis over the last decade, e-mail lists and the technology behind them have changed little if at all. Most are still run on university servers by volunteer moderators. The robotic software that handles the mechanics of message traffic for most lists is still next-to-unintelligible for the non-technical person. And therein lies the pain. Just finding and joining mailing lists used to require mind-bending strings of Unix-based incantations. Signing off a list once enrolled often involved several more painful steps. And actually hosting such lists was 100 times worse.

Mark Fletcher felt this pain firsthand in 1988 when he got his first Net account as a computer science student at UC-San Diego. Now, the 28-year-old is doing something about it. His nascent venture, ONElist, is taking the rough edges off the unsung old technology with a Web interface that makes finding and joining lists as simple as operating a search engine. By making e-mail lists safe and inviting for non-geeks, Fletcher may trigger a great social revolution in one of the Net’s oldest and most staid neighborhoods.

After 15 months of operation, ONElist is clocking some heavy numbers: 3 million registered members; 12 million pieces of e-mail sent each day; 120,000 mailing lists. The current rate of growth for memberships is impressive even by Net standards — 30 percent per month.

At this point Fletcher is living a Silicon Valley start-up cliche: His company consists of 15 cheerful, highly caffeinated young people (only two employees over 30) sharing a cramped, sparsely furnished budget suite in an anonymous office park by Highway 101 in San Mateo. Computer carts and El Cheapo 6-foot particle-board tables are just about the only furniture in sight.

Fletcher’s journey to this boiler room began in August 1997, when the start-up he worked for, Diba, was acquired by Sun Microsystems. Fletcher sketched out 10 ideas for his own venture and ranked the list from most-achievable to least-achievable. A company that would make mailing lists appealing to the masses was at the top of that list. The operation began in January 1998 when Fletcher told a single person about the Web-based service he’d designed.

“It was a Saturday night and I sent e-mail to this one guy — a stranger in Norway — and I woke up Sunday morning and there’s a list,” says Fletcher, sitting down to chat earlier this week in ONElist’s closet-size conference room. “That first list was on a particular type of lizard called an anole. Through the first couple weeks you could trace how word spread through communities – at first 10 or 20 more lizard lists, then it would jump wildly to some other topic and we’d have 50 or 100 specialized lists on that before it’d spin out to the next area.”

Fletcher didn’t quit his day job at Sun. He ran ONElist as a one-man show for five months. “I wasn’t doing anything to promote it but it kept growing. I remember passing 10,000 users and thinking `Wow. I’m going to have to do something.”‘ Specifically, that something was hiring other engineers to make sure the digital bridge didn’t collapse under the load.

On funding, it could be said that Fletcher provided his own first round of venture cap. The first year’s operations — approximately $30,000 for rented server space — were entirely out of pocket. By December of last year when he received his first outside capital infusion, ONElist had passed 1 million members. It was time to move the company out of his living room.

ONElist has been in the current space two months. Fletcher says that with any luck they’ll be able to stay here a couple more before growth sends them packing again. The fact that ONElist continues to grow at such an explosive rate — with zero advertising and minimal marketing — says something about the need for e-mail pain-relief. The appeal of the service to long-suffering volunteer list moderators is direct and compelling: We’ll take care of all the hassles — new subscriptions, un-subscriptions, junk-mail control, delivery problems — and free you up to be the host of your party. “One of the reasons I did this in the first place,” says Fletcher, “was so that you wouldn’t have to be a rocket scientist in order to be a community leader. My father couldn’t run a (Unix-based list server) but he runs a list on ONElist.” The moderators, who pay nothing for ONElist service, will ultimately be the ones to decide if ONElist succeeds. They are the publishers, the content cops and the marketing force for their individual lists and, by extension, ONElist as a whole. And it’s the moderators’ sense of propriety that will keep the system from degenerating into the noisy anarchy that characterizes much of the Usenet newsgroup system today. Every list, bar none, is owned by an individual. Every new thread in the fabric of the electronic discussion is read and approved by a human. In a Net environment that can often seem bereft of any human oversight, this is a compelling advantage.

Fletcher hopes ONElist’s technology will make community leadership in cyberspace a bit more democratic. “It’s amazing the range of people we have running groups — people who never would have organized anything like this before. We have 10-year-olds. And we have a lot of teen-age girls with their `Titanic’ and Leo Di Caprio lists. Then, at the other end of the spectrum, we have older people researching family history. I think we have 1,500 genealogy lists devoted to different surnames alone.”

Beyond the core of moderators, ONElist could also play a role in broadening overall participation in the digital world. It’s possible for a person with no computer, no online account and no technical expertise to go to a library public access terminal, get a free Web-based e-mail account and participate in an unlimited number of ONElist communities — all without spending a dime. Fletcher says he doesn’t know how many of his users are homeless, but he does know that a significant number of the members don’t own personal computers.

So given all these democratizing tools, what are the citizen-pamphleteers of the Wired Age building out there?

Just about anything you can imagine — from family newsletters (ONElist supports closed lists that are open by invitation only) to full-blown electronic extensions for other media. (The 17,000-member “Ask Dr. Science” list, supporting the public radio show of the same name, recently migrated over to ONElist.) If there’s one stat that proves Fletcher’s digital prairie-fire is permanently changing the nature of mail lists, it’s this: The majority of the 120,000 communities were born on ONElist, not ported over from other servers. In other words, there are tens of thousands of fledgling communities — most just a few months old — that almost certainly never would have formed under the old system. While most ONElist groups have no history as a physical community, that’s not the case for all.

Eagle Mountain was once a Southern California mining-company town with a population of 2,000. When the mines closed in the ’70s, the community scattered. Now, 50 former neighbors are rebuilding a virtual Eagle Mountain neighborhood in cyberspace.

For all its social ambitions, ONElist is a bona fide business with some concrete plans for revenue. At the moment, the advertising system is essentially halfway rolled-out. Banner ads on the company’s home page — http://www.onelist.com — get 22 million page-views per month and consistently sell out. Still, relatively few users return to the home page regularly after they’re hooked up with the groups they want.

To reach those eyeballs, ONElist is just beginning to place text ads at the bottom of individual pieces of e-mail. To a potential advertiser, the advantage ONElist has over a portal or other high-traffic service is focus — the ability to identify and reach very highly targeted pools of users without getting into the thorny privacy issues that come with targeting individuals. Fletcher says that eventually the company will get additional revenue by selling enhanced services to list owners. A list owner who wanted, for example, more storage space for shared files than the system currently provides gratis would be able to purchase that extra server space a la carte.

ONElist is not the only start-up devoted to making mailing lists a true mass medium. Two other firms — eGroups and Topica – have launched since ONElist appeared on the scene. ONElist says its daily traffic volume far outstrips that of any competitor. On the other hand, eGroups claims 4 million users to ONElist’s 3 million and 150,000 lists to ONElist’s 120,000.

For now, Fletcher seems to be none too concerned with revenue or competition. He says tech support and engineering are the things he must stress now if he’s to keep the corporate rocket-sled from careening off the tracks.

“I’m a geek by birth, so the technical challenge keeps me up,” he says. “Beyond that, I lose sleep over hiring the right people in the valley’s competitive environment — engineering staff, sales team, senior management. And then I worry about how we build out the service.”

With the financial markets raining IPO money on any Net start-up that floats a prospectus and valuations defying any known logic, is it hard for Fletcher to keep his attention on the mundane service issues? He looks down at a Net trade-magazine that has splashed “This Week’s Billionaires” across the cover and smiles indulgently. “OK, this is not exactly the worst time to be around,” he says. He catches himself before the reverie can kick in. “But we have to stay focused on service — otherwise we won’t get there.”

David Plotnikoff writes about the wired life for the San Jose Mercury News, 750 Ridder Park Drive, San Jose, Calif., 95190. E-mail plotnikoff@sjmercury.com. On the Web, dial http://www.sjmercury.com-columnists-plotnikoff

1999, San Jose Mercury News (San Jose, Calif.).

Startups Get On The List – Red Herring Article

May 26, 2010

By Owen Thomas
Red Herring
February 26, 1999

Sometimes it seems like all of Silicon Valley is on the same mailing list.

In the past six months, a bevy of startups have gotten funding for the same goal: building a critical mass of subscribers to email lists, and building direct marketing engines targeting those subscribers.

Startup veterans formed Topica, Onelist, and eGroups in 1998. Onelist launched early last year; eGroups followed in January 1999; and Topica launched its service this week.

Topica was the first to go out for a large venture round; August Capital and Highland Capital Partners invested $4 million in August 1998, and Onelist raised the same amount from CMGI’s @Ventures arm and Bertelsmann Ventures in December. After raising a $1 million seed round in June 1998, eGroups scored another $5.1 million from Atlas Venture and Sequoia Capital in January.

A TANGLED WEB

The tight-knit venture community has taken a keen — and competitive — interest in these companies.

“Onelist got funded from CMG and Bertelsmann, and it was basically me who connected CMG and Bertelsmann together,” says eGroups CEO Martin Röscheisen. “They really wanted to invest in us, but [Sequoia partner] Mike Moritz is of such caliber that we rejected [CMG and Bertelsmann]. They turned around and put the money in Onelist.”

Bertelsmann Ventures partner Jan Buettner wouldn’t comment specifically on whether his fund approached eGroups, but says he did due diligence on several companies in the space.

“We thought that Onelist had the better management team and growth rate,” says Mr. Buettner. “I negotiate with two or three companies at one time. If you have a problem with one company, you want to have another one in place.”

And Topica and eGroups share the same law firm and strategic consultancy, the recently formed BZ Partners. Jim Brock — the legal eagle behind Yahoo (YHOO) for many years at Venture Law Group — is advising Topica, while his partner Bob Zipp is advising eGroups.

“Bob and Jim seem to be managing a Chinese wall about those topics,” says Mr. Röscheisen. (To complicate matters, Mr. Brock serves on the board of FindLaw, Mr. Röscheisen’s previous startup.)

SIBLING RIVALRY

Despite these industry connections, all three companies seem to be launching a fierce war of words.

EGroups and Onelist eagerly point to their lead on Topica in numbers. For its part, eGroups counted 3 million users and 5 million emails distributed in a day. Onelist has slightly more than 2 million users, but they’re considerably more active, at 10 million emails a day.

Topica is taking a different approach, however. The company has built a directory of lists, partly by licensing collections of mailing lists created by long-established Net volunteer groups, and partly through the acquisition of the List Exchange, a site Topica bought from Webbers Communications last summer.

“We don’t care if the list that you’re on is on Topica when we manage it,” says board member Andrew Anker, a partner at August Capital. “The other guys are building a closed system. List owners don’t care whether their subscribers are on Topica or not; subscribers don’t care whether the list is on Topica or not. … You can manage Onelist on us; you can manage eGroups on us.”

In fact, eGroups also allows subscribers to manage subscriptions to lists hosted outside. But Topica CEO Ariel Poler says that his product is designed specifically to target list owners.

“The more owners we have on our side, listed on our directory and archiving with us, the more value we can offer to consumers,” says Mr. Poler. “One thing [eGroups and Onelist] have been doing is archiving lists without permission and getting in a lot of trouble with owners.”

For eGroups’ part, it sees potential on the corporate side as well as in consumers. “We expect the OEM part to possibly be even bigger down the road,” says Mr. Röscheisen, comparing his company to Critical Path — another company that has staked its IPO hopes on outsourcing email.

Onelist, meanwhile, is focusing on the growth of its numbers.

“We expect 20 million users by the end of the year,” says Onelist CEO Mark Fletcher. “And we’ll be sending out 3 billion email messages a month.”

Those are big numbers — and they might attract big players.

“All the major portals have been very interested in getting to know us,” says Joe Gillach, Onelist’s acting vice president of marketing.