A sure sign of a top?:"IPOme.com to launch individual stock sales. Visionaries have always had their doubters.
By Owen Thomas
Red Herring Online
April 1, 1999
"Though the folks in Silicon Valley
have taken a lot of strange stuff to
the public markets in recent years,
no one has yet figured out how to
take a person public," Fortune
wrote last month.
"When I read that, I just laughed,"
says Hans Urkunde, founder and
CEO of IPOme.com. "Because
we have figured out how to take a person public."
IPOme.com plans to do for
Silicon Valley what the
Hollywood Stock Exchange did
for Tinseltown -- but the startup
aims to put real money in the
pockets of market-ready
individuals.
The plans are still under review by
the Securities and Exchange Commission. And the
U.S. Constitution's Thirteenth Amendment appears to
pose a challenge to issuing more than a 50 percent
stake in an individual.
But with the necessary approvals and Supreme Court
rulings, IPOme.com will soon begin offering its
PersonalIPO service to selected individuals. Its clients
will incorporate themselves and offer shares to the
investing public over the Internet.
Mr. Urkunde left hedge fund Cramer, Berkowitz &
Co. late last year to start the company.
"In advising high-net-worth individuals, I realized that
the equity markets offered a better way for people to
reach their market-cap potential," said Mr. Urkunde.
"And [TheStreet.com chairman and commentator] Jim
Cramer showed me that sheer force of personality can
be a profit center."
Nirav Tolia of Yahoo (YHOO) has joined the
company as vice president of marketing, and David
Beirne -- originally contracted to help form the
management team -- has himself been recruited. The
former Benchmark Capital partner and head of
Ramsey Beirne Associates will serve as executive vice
president and director of research. Mr. Beirne, an
experienced recruiter for high-tech firms, will develop
new methodologies to track and analyze individuals'
earning potentials.
Tim Smith of the Stencil Group will handle business
development and public relations for the new firm.
"They're really the same thing," says the former head of
NRW Interactive.
POUND OF FLESH
IPOme.com plans to capitalize on emergent trends in
the new economy: personalization, monetization, and
capitalization.
"Eyeballs are the currency of the new economy, and
we're going to offer them up two at a time," says Mr.
Tolia.
"This is the one-to-one future writ large," says Ron
Rappaport, an analyst at Zona Research. "Instead of
selling slices of their attention, people will sell slices of
themselves."
Andre Wanker, a partner at Sand Hill Road venture
capital firm April Capital, which has invested in
IPOme.com, says his firm sees limitless potential in the
new firm.
"It's a wide-open market, a big opportunity," says Mr.
Wanker. "At the end of the day, it's all about great
teams. Venture capitalists always say that they invest in
teams, not companies, but IPOme.com will make them
put their money where their mouths are."
According to Mr. Wanker, April Capital has taken 10
percent stakes in IPOme.com's executive staff, as well
as an undisclosed equity position in the firm. "We took
the usual pound of flesh," he noted.
GETTING PERSONAL
Ann Winblad, general partner in San Francisco venture
capital firm Hummer Winblad Venture Partners,
acknowledges that IPOme.com's model may change
the way venture capitalists invest.
"I've always invested in people," says Ms. Winblad.
"Take Sharam Sasson of Extensity -- I'd invest in
anything he does. Or Julie Wainwright -- it would have
saved us a lot of paperwork just to invest directly in
her!" Hummer Winblad recently took a stake in Ms.
Wainwright's latest company, Pets.com.
"We could have done that investment just by adding
[Pets.com founder] Greg McLemore to our portfolio!"
says Ms. Winblad.
Amazon.com (AMZN) also took a 50 percent stake in
the online pet supplies store, showing that merging
financial markets with labor markets is the wave of the
future. Before taking a 50 percent stake in her
company, Pets.com, Amazon had attempted to recruit
Ms. Wainwright for a position at the Seattle-based
e-commerce firm.
High-tech executives could make even more money
from the equity markets if IPOme.com takes off. But
not every career choice will lead to PPO riches.
"I'd like to take myself public," says Web commentator
Carl Steadman. "But I worry that the SEC-mandated
quiet period would hobble my career as a columnist."
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