Anatomy of a Start-Up Collection

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In Big Plans," an article in the January 2001 issue of Inc. magazine, Anne Marie Borrego brings us news about eight companies that were profiled in Inc.'s Anatomy of a Start-Up case studies from 1996 through 1998. Here are links to the original profiles -- plus three more updates.

From the Inc. Archives: The Original Anatomy Profiles
1. In Celebration of Golf
2. Slanted Publications (formerly Smug Inc.)
3. CDnow
4. Streamline.com (formerly Streamline Inc.)
5. Switch Manufacturing
6. Cruel World (formerly Career Central Corp.)
7. Excelsior-Henderson
8. Oregon Chai

More Big Plans: Updates on Three Anatomy of a Start-Up Subjects
JONES SODA
Company: Jones Soda Co. (formerly Urban Juice & Soda Co. Ltd.)
Founder: Peter van Stolk
Date of Inc. Anatomy: "Brand New," April 1997

Vital signs then: Van Stolk created a beverage company from his existing beverage distribution business, based in part on his theory that, as he said, "one key to successfully launching a new brand is getting the right distribution."

He used innovative (read cheap) marketing techniques -- such as product placement on hip Gen-X television shows -- to promote his retro-chic flavors. Van Stolk predicted that in 1998 he could sell 1.1 million cases of his brands and rake in $21 million in revenues.

Based in Vancouver, British Columbia, the company went public in 1993 and traded on the Vancouver Stock Exchange.

What the experts said: Some questioned van Stolk's belief that brand equity can't always be sustained (thus, his decision to name the company Urban Juice & Soda, not Jones Soda, so that he could create a succession of additional brands) and suggested that he'd have to get behind the brand to attract distributors and consumers. Others felt that the company showed promise if it could grab a cult following of trendsetters on its shoestring budget.

Vital signs now: Van Stolk finally got tired of explaining his Urban Juice & Soda name, so he's officially changed the company's name to Jones Soda, to match its signature offering. He moved the headquarters to Seattle, and the company is also trading on the OTC Bulletin Board exchange. Jones Soda didn't reach the revenues it projected for 1998 -- a shortcoming van Stolk blames on a problem with flavor deterioration in 1996 -- but it should come close to $20 million for 2000.

It has, however, garnered a loyal following of soda enthusiasts who send in photos for Jones Soda labels. In 1999 soda fanatics sent 48,000 original photographs to the company in hopes of securing a coveted spot on a Jones Soda bottle label. Jones even set up a Web site (myjones.com) that allows customers to use their own digital photographs to design custom Jones Soda labels. Although the company reported an operating loss for the first nine months offiscal 2000, it posted a profit for that time period because of thesettlement of some litigation with a former ingredient supplier. Jones Sodahas introduced an energy drink called Whoopass and is increasing the size ofits sales staff.

What the experts say today: "If I'm interpreting this correctly, it seems to me that Mr. van Stolk has decided that the idea of a fashion-oriented transitory brand is not a long-term strategy for success," says Jim Mullen, founder and former CEO of Mullen Advertising, in Wenham, Mass. "It's pretty much what the other folks and I were saying that he should do, in 1997. There is a reason why one invests in a brand. It's because the brand is the most durable asset that the company owns. Founders die. Warehouses burn. Patents run out. Technology becomes obsolete. But brands are forever. So I congratulate Mr. van Stolk. He did the right thing." --Anne Marie Borrego

U.S. BICYCLE CORP.
Company: U.S. Bicycle Corp. (formerly the Chicago Bicycle Co.)
Founder: John Sortino
Date of Inc. Anatomy: "A Bicycle Built for You," April 1996

Vital signs then: The founder and former CEO of the Vermont Teddy Bear Co. dropped the warm and fuzzy stuff in favor of starting a new, top-of-the-line bicycle company that would sell to the age 40-plus customer who had $1,000 to spend on a new pair of wheels. Sortino contended that eliminating the dealer would save him the markup, and building to order would lower inventory costs. He hoped to hit $51 million in sales in 1998.

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