Some entrepreneurs get crowned in the record books as spectacular successes. Others find themselves lumped into the losers list of spectacular flameouts. Louis Borders is that rare businessman whose name appears on both sides of the ledger.
Borders is a co-founder of Borders Group, the $3.4bn company that today is the nation's second-largest bookseller. He also happens to be the man behind Webvan, the billion-dollar online grocer that famously failed in 2001 and became synonymous with both the magnificent dreams and the hubris of the dot-com era.
Now this self-professed serial entrepreneur is taking another stab at building a brand from scratch. Borders has now launched a subscription-based digital newsstand called KeepMedia.
But he also faces the challenge of convincing Web surfers to pay to access archived online content. Despite the Web's transformation into a major publishing platform, relatively few Web users have warmed to the idea that they also should pay for content.
Borders nonetheless remains determined to prove conventional wisdom wrong. KeepMedia is a subscription-based outpost for magazines such as Business Week, U.S. News and World Report and Esquire. Though it's an idea that's already been tried and failed, Borders believes KeepMedia is different and will prove to be a superior online brand, because, he says, it offers quality publications and convenience.
He also brings to the table a rare been-there, done-that resume, which will suit him well, as he tackles what may be the toughest selling job of his career. CNET News.com interviewed Borders from his company's headquarters in Foster City, California, which coincidentally is the former hometown of Webvan.
Q: How and when did you conceive KeepMedia?
A: When Doug (Harrington, KeepMedia's co-founder and CEO) and I got together. We are deep believers in the Internet. Even though the dot-com bubble has busted, the Internet has really roared along. As we looked at the industry, we were scared away from music because of all the rights issues. One thing that struck us is that the movie business (gets) two-thirds of their money from their archives, while magazines are getting zero. That's a huge pool of content that's not monetised at all.
Is there a difference in the way that you think about an investment in an Internet venture in the year 2003 compared with 1998?
Oh sure, reality has set in. We've all learned that the money in the heyday of the boom was more of a curse than a blessing. It made everyone break basic business principles. Today, the start-ups are very well crafted, very well thought through.
One specific thing that we learned was that we wanted to have a co-marketing, co-branding model, whereas believing that you can go out and buy eyeballs to build a brand -- we learned you just can't go that way. You must co-brand. Co-branding is an interesting business activity, because some of the great success stories in business are co-branding models. One specific example is when Dryers Ice Cream and Starbucks got together and made their Java Chip ice cream. It became the best-selling ice cream in the world.
How does that apply to your upcoming business?
Magazines are tremendous brands with great communities, but they're underutilised. So, if we can put them together to help us build a brand, then we can in turn give them a revenue stream that's essentially paying them to better utilise their brand. It's like a mall. You know the stores inside.
