If you’re an entrepreneur in training you ought to be taking notes. ompetitor.
EBay announced plans to acquire Half.com yesterday in a blockbuster stock
deal valued at roughly $350 million. It’s a win-win move for both
companies; but for one serial entrepreneur, it’s a four minute mile in
front of the home crowd.
Joshua Kopelman is the 28-year-old co-founder of Infonautics . The firm is best known for its innovative Company Sleuth service, which
grabbed headlines by the bushel last year when it started publicizing
recently registered domain names from publicly traded companies like
Amazon and Dell
.
After serving his tour of duty as executive vice president of Infonautics, Kopelman got the itch
again. He announced his departure this time last year to start a new Net
venture named Half.com. His old company
funded the new start-up with a quarter-million dollars in exchange for a
five percent equity stake. And it’s been off to the races ever since.
With a group of hand picked IT buddies, the business savvy Kopelman set out
to make his mark the old-fashioned way. With a great idea. Crossbred
between Amazon and eBay, Half.com is a person-to-person e-marketplace for
used goods. EBay focuses on those hard-to-find items and lets user bid on
them. But unlike the online auctioneering giant, Half.com focuses on
non-scarce items, allowing users to sell used books and CDs on its Web site
at a fixed cost.
On Half.com people don’t bid on items, and there’s no cost to list old junk
from the attic. The company makes money by taking a 15% sales commission on
items sold, and it takes just a few seconds to list sale items using the
UPC code. Half.com gets two thumbs way up for escrowing credit card
transactions. A fantastic policy that a billion dollar dot-com like eBay
desperately needs to consider.
Amazon sells plenty of new books and CDs, but there’s little in the way of
an aftermarket for plentiful used goods. Although, that hasn’t stopped
analysts from comparing Half.com to the king of e-tailing since day one.
Armed with a modest war chest, Half.com came to a fork in the road. With
all the dot-coms scrambling over one another to stand out from the crowd,
how could Half.com create a buzz over its Web site? Cooked up in-house, the
company unleashed the most clever publicity stunt we’ve seen this
millennium. The idea was to get the sleepy town of Halfway, Oregon to
temporarily change its name to Half.com in exchange for some free computers
and $75,000 cash.
It would mark the first time a town ever named itself after an Internet
upstart, and the media howled with delight at the genius of the marketing
move. In a time of million dollar Superbowl ads by penniless newcomers,
Half.com managed to parlay pocket change into a king’s ransom worth of free
publicity. Every major news media outlet across the world picked up the
story and ran with it. And overnight, Half.com was put on the map.
Despite waning enthusiasm in the online retailing industry, venture
capitalists weren’t about to pass up on the next Amazon.com. In its third
round of funding, Half.com netted $17 million from a who’s-who list of deep
pockets that included @Ventures and
Safeguard Scientifics .
Rocketing to the 18th most trafficked e-commerce site on the Net in a New
York minute, Half.com attracted more than just curious onlookers. EBay was
so impressed with how fast the company landed in its backyard, that it
decided to extend the brass ring to Josh Kopelman less than a year from his
departure from Infonautics, and before the start-up has a chance to grow
into a fearsome ancillaryc
Forget the premium. EBay makes a super move here. Lots of synergy with
little overlap between these companies. And this is one start-up who could
teach the old dog some new tricks.
Any questions or comments, love letters or hate mail? As always, feel free
to forward them to kblack@internet.com.
Putting Half.com on the Map
