NetSudser Craig Warren has joined XIOtech as a Manager of the Channel Partnerships.  Craig was most recently the VP of Marketing at VoIP startup Aravox.  You can reach Craig at crackoh@aol.com. 

NetSudser Tom Mills has joined Digital River as Senior Director of Client Services.  Tom was most recently with Stellent.  You can reach Tom at either tmills@digitalriver.com or 952.253.8337.

NetSudser Nancy Harrower has joined Retek as Director of Public Relations.  For the past year she ran her own marketing consultant practice (New Venture Communications) and prior to that she was Director of Corporate Communications at Lawson Software.  She can be reached at 612-587-2818 or nancy.harrower@retek.com. 

1.2 Companies on the Move:

Please email:  start-ups@netsuds.com to report (1) the formation of a new start-up, (2) momentum change at an existing start-up, (3) addition of key hires, or (4) a funding event at a start-up.

NetSuds sponsor Integra Telecom announced a $22 million round of debt and equity financing from Bank of America Capital Investors, Bank of New York, Boston Ventures, CIT Group, GE Capital, Nautic Partners, and other undisclosed previous investors.  Locally, Integra has been very successful.  Congratulations to Carol, Anita and the team in the Minnesota office!

NetSudser Dan Cummings, gofast.net co-founder, has acquired the managed hosting and email business from Agiliti and formed Manage.net LLC.  You can reach Dan at either 612.821.5000 or dan.cummings@manage.net.

Eschelon Telecom raised a $35 million equity round, announced July 1.  Congratulations to Cliff Williams and his team!

Decidia has moved its offices from San Jose to New York City.  They cite a desire to be closer to their customer base as the main reason.  Decidia was one of the 53 companies participating at the NetSuds-sponsored National Entrepreneur Conference in Silicon Valley in September 2000.  You can contact Joe Chin, President at jchin@decidia.com or 212.227.8990 x301.

Dallas NetSuds Lonnie Martin, a former SVP and Group President at ADC Telecommunications, had to cut 25% of his staff (about 38 employees) at White Rock Networks recently.  The telecom equipment slowdown continues but White Rock Networks is a survivor.

IP Unity, headed by ex-ADC VP Arun Sobti, has acquired EmpowerTel Networks.  Both IP Unity and EmpowerTel presented at NetSuds Entrepreneur events.

4.1 NetSuds on Tour - InstyMeds

NetSuds loves on-site tours!  Email me if you want to show off your company.  I can be reached at matt@netsuds.com.

I visited one of the few InstyMeds installations in the world in July at South Lake Pediatrics.  InstyMeds is a combination of IT and medical.  The concept is simple.  Go to a physician and get a prescription.  Exercise one of three options.  Option 1.  Decide on any number of pharmacies to get your prescription filled.  Call it in, wait some time and then go get your medication.  Or bring it to a pharmacy and wait (shop while you wait).  Option 2.  Don't get your prescription filled because the inconvenience of option 2 gives you a headache.  Option 3.  Take your prescription to an InstyMeds pharmaceutical vending machine and have your prescription filled in minutes while you wait.

I visited with Ken Rosenblum, Founder and CEO of InstyMeds, krosenblum@instymeds.com, 952.252.1985 x155 at the InstyMeds installation at South Lake.  Ken is a physician with many, many interests.  InstyMeds was born out of an experience by Dr. Rosenblum which caused him to run around the Twin Cities trying to find an all-night pharmacy to get a prescription filled for his sick child.

The InstyMeds vending machine dispenses up to 80 different common prescriptions.  Pills are bottled and syrups are as well.  Check, double-checks and triple-checks are processed to ensure every prescription is filled correctly.  All the InstyMeds vending machines are tied together in a WAN and controlled centrally.  This ensures prescriptions are filled the correct number of times and that all vending machines are secure and stocked.

While visiting the InstyMeds installation, I was able to see 2 customers use the machine.  Both were excited about using the product.  One, a young mother, was absolutely thrilled with the prospect of not having to drag her young children in to a pharmacy, wait for 30-60 minutes and then load them back up in the mini-van.  Consider that her husband was working, the waiting children probably included the ill one and that Minnesota has cold winters, you can see why she was excited about InstyMeds.

InstyMeds solves a problem for which people and companies will pay money.  The first application is but one of many including hospital use and large retail (Target, Wal-Mart, etc.) use.

4.2  Upper Great Plains Technology and Trade Show

Many of the independent station operators represented in the Internet Radio industry are currently at war with the RIAA. Even if the RIAA ends up winning this battle, eventually they will lose the war when they are forced to come to terms with their own historic antitrust activities.

Not knowing what to expect with our format change, pulverradio's daily listeners went from averaging between 250-500 daily listeners to averaging between 2,000 to 3,000 daily listeners with peeks as many as 6,000. So for us, the change in format has brought a dramatic increase in our listening audience and in turn we have the opportunity to expose people to the music of artists which don't usually get played on commercial radio.

If you're one of those folks who think the "dot com" era more fluff than substance you can stop reading now. Imagine your life without the Internet and you'll quickly realize how the Internet is as integrated in to your life as the TV, the phone and the washing machine. I can still remember hearing some NFL announcer in the mid-1990s trying to pronounce "h-t-t-p-:-/-/-w.w.w-" and thinking the nerds have finally won. Even earlier I noticed my TV viewing hours went way down and were replaced by Internet hours. It was the best of times.

Amid the Internet rubble are several thriving survivors; eBay, Cisco Systems, MicroSoft, Intel, Google, Amazon, etc. All are tied to the success of the Internet. Locally, one can point to Digital River, Stellent, ePredix and an upstart named WhereToLive.com.

The "dot com" era saw relatively easy access to capital fund many questionable business plans with questionable business models. Some ventures lacked a "pathway to profitability" or a strong management team or a large market opportunity. Others were just plain stupid. A business model needs to have essential elements of a product or service which another party needs or greatly desires which can not be as well delivered or reasonably priced from another vendor. It needs to have value and customers willing to pay enough money to make the venture a profit. The fact that it is a "dot com", i.e. uses the Internet in a substantial and necessary way to sell is besides the point.

Digital River and Stellent are excellent examples of established, publicly-traded companies with great management, great products and large markets. They have good business models. ePredix and WhereToLive.com are both private companies which appear on the cusp of greatness. Both have raised decent amounts of equity capital and have products and customers. In this article I want to dig deeper with WhereToLive.com because it has so embraced the Internet as essential to its businesses. As Roald Marth, CEO, says, "We're thinking of adding another dot-com to show people how much we love the Internet. We'll be the first dot com dot com".

WhereToLive.com is fascinating because almost anyone can understand and appreciate their products. In short, WhereToLive.com is a real estate Application Service Provider (ASP). They create a marketing and sales tool; the website and related Internet products for a broker and his agents. Digging deeper gives one insight as to why they stand out in their marketplace. First, and most important, is the management team. Roald Marth and Elizabeth Chesen have deep real estate domain expertise and a track record of success. They are not techies applying very cool technology. They are real estate people who know the industry up and down. They know what motivates their customers. I witnessed Roald make a sales pitch to 150 real estate agents. Ten minutes in to the presentation, I knew he had 60% of the agents sold on his product. A few minutes later, over 80% were sold. He connected with their needs and convinced them his product would help them sell more listings and obtain more listings. I have seen some of the best local CEOs pitching their companies in the Twin Cities in the past 5 years. The three best were Wade Meyers of Interelate, Tim Devine of Dantis and marketing VP Craig Warren of Aravox. Roald Marth tops all.

WhereToLive.com uses the Internet to attract real estate buyers so that brokers and agents can make relatively more money than their competition. Real estate is a large, fragmented market. Nearly every realtor has a website now but very few have a differentiated Internet presence which is a competitive advantage. WhereToLive.com has built a better mousetrap; a much better mousetrap.

Another factor working in WhereToLive.com's favor is the trust their customers have in their product. It is one thing for your customers to buy your product. It is another matter altogether when your customers are your largest investors. The company has raised over 6 million dollars and the majority has come from realtors and top agents. This is a highly unusal and enviable situation for any company.

There is no question the market opportunity is large and the management team strong. Others have tried to be real estate ASPs and some have survived. Others have lost great sums of money and folded. Will WhereToLive.com be the Microsoft of their market? It's too early to tell but all indicators are pointing in positive directions.