Letters

Readers said "amen" to Dr. Steven Berglas's take on the lack of integrity among today's leaders. Buying cars on-line, getting seasoned help, and starting up on a shoestring also seemed to pique readers' interest, as will, we believe, an update on Smug magazine.

The Anti-liar's Club

Many readers applauded Dr. Steven Berglas's August column, " Liar, Liar, Pants on Fire," which asserted that the behavior of leaders--including CEOs and even President Clinton--is directly reflected by the behavior of the people they lead. This CEO's comments were typical:

The article really spoke to me. On my office wall I have a sign posted that reads, "Success is not real unless it is accompanied by strong character." As the owner of a start-up company, my goal is to live up to it.

Jim Mullaney
CEO
Electronic Document Service
Fairfield, Ohio

One parent was equally effusive:

Kudos on a fine article. I especially loved the second-to-last line: "The CEO who lies and cheats...should remember this: the liar's punishment is not that he is not believed, but that he can believe no one else." That's truly a profound thought and something I plan to share with my daughter when it's time to teach her why lying and cheating aren't acceptable. I hope the "genius" Berglas describes reads Inc. and is smart enough to see himself in the column. Sadly, even if he does, old habits die hard, and he's not likely to change.

Mary Byers
Director of Communications
Illinois State Dental Society
Springfield, Ill.

On a Dime

One businessman found editor-in-chief George Gendron's observation in " No Pain, No Gain" (FYI, August)--that a lack of cash at start-up can actually make some businesses stronger--dead on.

I agree with Gendron that his friend is making a mistake by not bootstrapping his second venture. Having started four companies, I can vouch for the fact that my businesses failed when I had the benefit of money and resources. With bootstrapping on less than $10,000, I made two businesses successful within five years. Mind you, after two failures, I'm more humble and patient. Humility (usually the result of failure) and persistence are the first two requisites to making a business go.

Roy L. Manns
President
Polyfiltronics
Rockland, Mass.

Pete's Wicked Sale

In " Burning Down the House" (August), Edward O. Welles introduced readers to Pete Ellis, whose Auto-By-Tel on-line service promises to revolutionize car purchasing. Readers welcomed the change.

Welles's article points out the obvious to any auto dealer willing to listen. Unfortunately, too many of them can't see what has been clear for years. Whenever you have a potential customer who willingly pays a middleman a fee to avoid the pain of shopping in your store, you should know you have a problem. The rise of auto brokers, along with the acceptance of true fixed-price auto dealers, should have been a clear warning to even the most intransigent dealer. The Internet is making it easier and more economical for the new middlemen to remove the pain of this shopping experience.

Mitchell Gooze
Partner
The OMT Group
Santa Clara, Calif.

Money Goes Places

In response to Mike Hofman's " Desperation Capitalism" (August), one reader wrote this of the companies in our bootstrappers' hall of fame, which listed well-known companies started for less than $10,000:

Your article would have been more informative and realistic had there been a comparison chart indicating the value of that start-up money in today's dollars. What would be the increase in the purchasing power of, say, Roadway Express's $2,400 in 1930, or the Clorox Co.'s $500 in 1913, or even Apple Computer's $1,350 in 1976?

Paul S. Schueller
President
Paul Schueller International Inc.
Spring Valley, N.Y.

Mike Hofman responds: Schueller's point is valid. In 1997 dollars Roadway Express's $2,400 in 1930 would be worth $22,922.42. Clorox Co.'s $500 in 1913 would be worth $8,055.65. And Apple's $1,350 in 1976 would be worth $3,476.52. Of the others mentioned: Lillian Vernon's $2,000 in 1951 would be worth $11,995.80; her $495 advertisement would cost $2,968.96. The Limited's $5,000 in 1963 would be worth $23,292. Gateway 2000's $10,000 in 1985 would be worth $14,386. And the $900 Domino's had in 1960 would be worth $4,367.79.

House of Corrections

I apologize for being picky. But in Atlanta you might have some difficulty finding former Coca-Cola Co. owner Asa Chandler's relatives [" Rags to Riches," August]. It is Candler. My wife is a Candler, so I am certain of this spelling.

Richard Yates
Systems Consultant
Intellinet Inc.
Atlanta

We stand corrected.

Advisers: SCORE Board

Stephanie Gruner's article on getting competent advisers to serve on your corporate board, " The Ultimate Board Game" (Hands On, August), drew several letters that referred interested readers to the Service Corps of Retired Executives (SCORE). One SCORE volunteer wrote:

SCORE is a nonprofit national group of retired executives who have elected to dedicate their time and talents to helping small businesses. Your readers can learn more about us on the Internet at www.score.org. I'm currently serving as a board member or adviser to two small businesses, and I can tell you with all modesty that the business owners are thrilled to have access to someone who has business experience, who will make suggestions, and who has no hidden agenda other than a desire to make their businesses successful. And most small businesses will be happy to hear that our services are provided at no cost.

John R. Campbell
Former General Manager
General Electric Aircraft Gas Turbines
Cincinnati

Update: Halperin Is Still Smug with Success

"It's unfortunate that your article, moreover Shirley Halperin, did not give the whole truth concerning the start of Smug magazine," read an anonymous E-mail we received about our story on Halperin's alternative-music magazine, " What's Love Got to Do with It?" (May 1996).

"Initially, the publication was founded, staffed, and financed by, and raised advertising revenue on the backs of, Ethan Skolnick and Nimitt Mankad," read the message.

It turns out that Mankad had introduced Halperin to Skolnick, and Halperin had indeed leveraged Skolnick's publishing experience to jump-start Smug. She was responsible for its contents, but Smug's first issue (in February 1995) was a supplement to the first and only issue of Skolnick's Standard Fine Print. Skolnick continued to publish Smug's next two issues, with Halperin as editor-in-chief and Mankad as his assistant.

Smug graduated from Halperin's bedroom into a full-fledged office on the lower East Side of Manhattan in December 1996 and hit both its revenue and net-profit projections for that year ($120,000 and $15,000, respectively). This year Smug will fall short of projections--revenues will be closer to $225,000 (versus a projected $700,000), profits will be about $15,000 (versus a projected $150,000), and circulation should hit 30,000 (versus a projected 40,000).

Skolnick, who has since claimed no knowledge of the phantom E-mail message, concedes he left Smug behind for California. But he still likes to point out that when he met Halperin, "she had no money, no corporation, no nothing!" After helping her get started with contracts and connections, he would have "appreciated the common courtesy of a thank-you," he says.

He won't likely get one from Halperin. "There's a buzz on the magazine; ad pages are up," she says. "It's not surprising that someone would want a piece of that pie. Hey, if you don't have annoying little problems, you're not in business." -- Alessandra Bianchi

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