Paternot and Krizelman, both 25, have been through the wringer--from their early days as Cornell University hacks, to former Alamo Rent-A-Car founder Michael Egan's $20 million investment in their community site in 1997, to a delayed initial public offering, and finally to a record IPO in which TheGlobe.com's stock shot up ninefold on its first day of trading.
Now Paternot and Krizelman face a host of new challenges as the portal and community landscapes shift and offline media giants increasingly dedicate their marketing firepower to Web efforts.
The two executives are charged with the task of reinventing the image of their site, which offers Netizens free space to build home pages and then arranges them into community categories. They are looking to convince the world that community means more than just home page building--and that TheGlobe.com will go the way of Yahoo and Amazon in terms of future success, even in the face of direct competition from the likes of Disney and Time Warner.
Despite dogged marketing efforts that include a scheduled appearance on the Montel Williams talk show, the two have a long road ahead in overhauling TheGlobe.com's image as more than simply a place to publish home pages. Moreover, TheGlobe.com has yet to rank in the top 50 most trafficked sites, according to the latest Media Metrix figures.
CNET News.com recently interviewed the two CEOs about their company's plans.
CNET News.com: What do you see as the big appeal of TheGlobe.com? Is it
that people can build home pages?
Stephan Paternot: Not at all.
We now have to go and change the image or change the perception, rather, that everyone in the world seems to have about us because we named ourselves a "community," and a lot of people think "community" is home page building. So just that is a really tough issue, and TheGlobe could not be further away than being a home page builder. It's one of the many services we offer, but clearly, if you go look at the site, there's content, there's interactivity, there's commerce--all of those elements that you find at any portal.
So you are trying to be a portal?
SP: We're not trying to be a portal. What we built for four years that we were calling "community" happens to offer 95 percent of what people want. Meanwhile, there's these other companies called "search engines" that went and tried to offer 95 percent of what people wanted. So we're not trying to be a portal; we are a community, and that's what we have in a community. It just so happens that portals in a sense have evolved to a definition that's the same definition that we have.
Todd Krizelman: One of the things we've often described to people is that we've married together the breadth and the depth that you find in portals with user interaction--and then, wrapped around that, e-commerce. And that's something that those other sites do not specialize in; that is, the other sites out there have gone and said, "We're going to offer you everything very disparately..." That is, "If you want chat, we'll buy that and put it in there." We've tried to integrate all these things very, very closely together so that people end up having a better experience at the site.
You guys are talking about growth of audience. Why not just go partner
SP: We may. We're not saying this is all about going it alone. Whether we get bought or not, whether we partner with someone or not, whether we sell a small stake of equity, a big stake--none of that really matters. If someone owns us, they're going to still want TheGlobe.com to build its audience the best it can, to find the best services, to be competitive, to build the brand--we've got to keep doing that. Meanwhile, we're still completely open to partnerships in the U.S. or in any other major market.
TK: I think you'll see us employ a strategy that allows us to grow very quick--and that is whether it is through those partnerships, whether it is through some equity investment--but certainly would be organic growth, certainly through acquisitions. We've been public for a little over three months. We've made one acquisition. We can absolutely tell you there's going to be more.
You have a lot of doubters. A lot of people are saying, "These two 25-year-old punks--what do they know about running a public company?" How do
you stay focused in the face of that?
TK: You need to have milestones. You need to be able to tell people ahead of time what the results are going to be and then achieve them or beat them.
SP: All I can say is that I can tell those people: Just watch the company year after year. And where you say we would fail and you were wrong, if in a year we did it, that'll change the perception. And it absolutely has, and it started with our families who were signing checks for us when we got the first financing saying, "Whatever it is you're building, it'll be at least a great educational experience." They were skeptical, but now they're not skeptical, and a lot of the early investors were skeptical, and now they're not. It's a constant process of education.