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4. A Spot In The Dark

COMPANY: Glow Dog Inc., Concord, Mass.
YEAR FOUNDED: 1997
CONCEPT: Sell light-reflective clothing for pets and the people who walk them
PRINCIPAL: Beth Marcus, 41, CEO, president, and founder
PROJECTIONS: Growing from $85,000 in 1998 to $1.2 million this year. "We anticipate that we're going to grow Glow Dog to $5 million to $10 million and then buy somebody else or be sold," says Marcus, who is also considering going public.
FUNDING: $80,000 of founder's capital and $800,000 from outside investors (another $2-million round of financing is planned for this year)

BIRTH LEGEND: Marcus and her cockapoo, Luke, were out for a constitutional one evening when a car almost struck them. "My neighbor came driving around the corner, and we had to leap into the bushes to get out of the way," Marcus recalls. "I wasn't wearing particularly dark clothing, and Luke has a light coat, but this guy didn't see us at all." At the time Marcus was a consultant to start-up Reflective Technologies Inc., a maker of a glow-in-the-dark fabric called IllumiNite. Reflective was targeting nocturnal joggers, a strictly two-legged market. Quadrupeds, Marcus thought, represented a whole other opportunity.

WHAT'S TO LOVE: With its message that healthy pets have shiny coats, Glow Dog is poised auspiciously at the intersection of two trends. Pets today "are frequently considered companions and members of the family," says Bill Schoolman, executive vice-president of the American Pet Products Manufacturers Association. As a result, the $25-billion market for pet supplies and services is growing 4% a year, and the safety-products niche is expanding. Meanwhile, safety products for nocturnal athletes are more popular than ever: worldwide sales of reflective clothing are expected to grow to $7.5 billion in the next few years.

And retailers seem to be lapping up Glow Dog's products. The company has 100 wholesale customers, most notably Petsmart Direct, a $160-million catalog subsidiary of Petsmart, the largest pet superstore in the country. "We don't need another toy or treat on our pages," says Tony Leonardi, president of Petsmart Direct. "We look for something that gives us a competitive edge, and we got that edge with some of the products we saw from Beth." Early sales of items such as dog collars and rain slickers have been unusually strong.

Glow Dog is sniffing around foreign markets as well. "There's an explosion of pet ownership in developing countries," Schoolman says. "Latin America and Asia have limited pet-product manufacturing infrastructures, so they look overseas. U.S. pet products have top-of-the-line status." Indeed, Marcus already has orders from Europe, Japan, and Australia.

Finally, there's the pedigree of the founder herself. "Beth's the kind of person I like to invest in," says Don Spero, an angel investor based in Bethesda, Md. "She gets a dollar's worth out of 30¢. She's creative, aggressive, and an awfully quick study, and she's jumped into this market up to her eyeballs."

FLIES IN THE OINTMENT: Glow Dog has a leg up on competitors, thanks to its exclusive rights to IllumiNite within the pet-supply category. But that can't stop imitators from poaching with products devised from cheaply made reflective fabric. "These guys watch each other," says Leonardi. "They'll see inventory of Beth's products in Petsmart and mimic the success."

THE "IF IT'S GOOD ENOUGH FOR BILL GATES" FACTOR: Marcus isn't likely to roll over and play dead at the first crisis; she's been down the chaotic company-building road before. The Rolex on her wrist is inscribed with the date April 12, 1996--the day she sold her first business, joystick designer Exos Inc. The reported price tag: more than $5 million. The buyer: Microsoft. --Mike Hofman

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