A 'Big Dog' in Chat Rooms
Takes a Wild Internet Ride
By JOHN R. EMSHWILLER
Staff Reporter of THE WALL STREET JOURNAL
CLIFTON, N.J. -- Mike "Big Dog" Nichols has gone from
textile-coatings salesman to Internet-stock guru to online investor-relations
specialist to co-founder of a publicly traded cyberspace-shopping mall
with a market value of about $100 million. All in less than a year.
The 42-year-old Mr. Nichols has seen his
wealth, at least on paper, soar by millions of
dollars in recent weeks because of his
holdings in the Internet shopping mall, called
iChargeit Inc., that trades on the OTC Bulletin Board. "It's unbelievable,"
he says.
It is the Internet stock-trading world, where mindboggling tales are almost
mundane. However, even in an arena where companies with barely enough
revenue for a cup of coffee can have Himalayan market capitalizations, few
stories illustrate more graphically the crazy power of the Net than Big
Dog's ride.
The ride started in this town across the Hudson River from Manhattan,
where Mr. Nichols lives with his wife and one of his two daughters. For 12
years, he sold vinyl coatings for textiles.
Stock-Chat Rooms
In November 1997, he began exploring the Internet stock-chat world.
There, he found adventure, intrigue, camaraderie and combat. There were
passwords to private electronic "rooms" where strangers from around the
world discussed "mo-mo mamas," "scam dogs," "bashers" and "pump and
dumps." Amid all this Internet stock-trading lingo was the lure of making a
fortune without leaving the upstairs living room of his duplex. It was, Mr.
Nichols recalls, "a world you wouldn't believe."
Like many Internet traders, he chose a new
name for this new world. The nearly
6-foot-5-inch, 370-pound Mr. Nichols
became Big Dog.
He quickly became a big bark on the chat
circuit. By last summer, over 500 people had
bookmarked Big Dog on the Web site Silicon
Investor, making him one of the most-followed names on that popular
stock-chat operation. In June, he quit his sales job to trade full time.
He had a flair for the dramatic. "Move over TokyoMex BIG DOG is in
town," was the message Mr. Nichols posted early last year on a Silicon
Investor chat site that had been started by another Internet stock-chat
guru. Mr. Nichols and his allies posted so many hostile messages that
TokyoMex turned the site over to Mr. Nichols, who promptly renamed it
the Dog House.
In the fall, someone started a chat site called "The life and times of BIG
DOG, a historical perspective." Fans portrayed him as a savvy stock
trader. Critics focused on his poorer picks. "If you place his brain on the
edge of a razor blade ... it would look like a Tic Tac on a 4 lane highway,"
one volunteered.
Online Consultant
Tiring of the turmoil, Mr. Nichols says he decided
to use his Internet fame to start an online
investor-relations and media firm, called Capital
Financial Consultants. Mr. Nichols says his firm
has signed up as clients several little companies
listed on the OTC Bulletin Board, which is
maintained by the National Association of
Securities Dealers for stocks that don't qualify for
the Nasdaq Stock Market itself. The companies
have paid him in stock that he estimates has a
current value of a few million dollars, though given
the volatility and difficulty in selling many Bulletin
Board issues any such paper wealth could have
the shelf life of a mirage. But even if he gets nothing from that stock, he
says, "I'm not afraid to lose money because I know I can make more."
Capital Financial Consultants' Web site carries a disclaimer saying it is paid
by some of the companies mentioned on the site. Whether the disclosure
efforts satisfy the U.S. Securities and Exchange Commission, which has
been cracking down on what it views as inadequate disclosure in this area,
isn't clear. The agency doesn't comment on specific Internet sites unless it
files a case, an SEC spokesman says.
Cyberspace Mall
In an effort to further cash in on cyberspace, Mr. Nichols recently teamed
up with his Internet buddy Cavalry, also known as Jesse Cohen, a
Huntington Beach, Calif., man who was developing the iChargeit shopping
mall.
The pair brought iChargeit public
last month by merging it with a shell
company that had no operations but
was trading on the OTC Bulletin
Board. Mr. Cohen is iChargeit's
chairman and chief executive. He
initially said Mr. Nichols was vice
president, but later upgraded him to
president. "Call me bottle washer as
long as I get the money," Mr.
Nichols says.
In recent weeks, iChargeit's stock
has gone from less than $4 to as high as $29, and is currently trading at
about $14. Mr. Cohen says he owns about 32% of the company's 7.2
million shares. Mr. Nichols says he has a stake of about 17%. Suppliers
and shareholders of the shell company have much of the rest, Mr. Cohen
says.
So far, only about 200,000 iChargeit shares are free to trade under federal
securities law, though more will become available in coming months.
Messrs. Cohen and Nichols say their shares are still restricted.
Counting on Big Gains
With a small trading volume, iChargeit shares weren't hit by Monday's big
sell-off in Internet stocks, nor was Mr. Nichols, who says his holdings
don't include any of the big online names. "Every Internet stock out there is
overpriced," he says, adding "except mine" in response to a question.
In the first three months of this year, iChargeit had $30,000 in revenue,
Mr. Cohen says. The company doesn't yet have publicly available financial
statements, but hopes to have them soon.
Its 14 online-mall tenants include a florist, a coffee seller, a consumer-loan
broker and an art gallery. They pay iChargeit between 10% and 20% of
sales revenue and about $140 per month in rent, Mr. Cohen says. The
mall also recently began carrying banner ads from other sites.
Some tenants are clients of Mr. Nichols's investor-relations firm. Mr.
Cohen has big expansion plans and Mr. Nichols plays down the
competitive threat of bigger Internet-mall operations. "There are enough
people to go around," he says.
Naturally, iChargeit has already spawned Internet chat sites. Critics
howled when they discovered that the initial artist featured at the mall's
gallery was Mr. Cohen's mother. Mr. Cohen says his mother is a fine
painter and that other artists have been added.
Mr. Nichols shrugs off the criticisms as he focuses on the hoped-for
bottom line. He says he sees no reason why he can't eventually reap tens
of millions of dollars from his iChargeit stock. With the Internet, "I feel like
anything I want, I can get," he says. |
