Of course, most of those revenues are so far theoretical. Kanner projects that edu.com will remain unprofitable until the end of 2002. The start-up also faces some formidable obstacles. For one thing the indisputable yumminess of the college market (15 million mostly wired students spending a total of $120 billion a year on goods and services) has not gone unnoticed. Edu.com's potential competitors include on-line textbook sellers like VarsityBooks.com, which is one of its partners, and peddlers of more general merchandise like CollegiateMall.com, CollegeClub.com, and StudentMarket.com. "I think we're going to be part of a consolidated industry with at least one or two multibillion-dollar players and maybe a few smaller ones," says Kanner. "We may be the consolidator. We may be consolidated."
Another fly edu.com has to pluck from its ointment involves technology. Its Web site is a complex, heavy-duty commerce engine that as of last fall still needed a lot of banging. Kanner hoped to achieve relative perfection by year-end, but during the site's first few weeks of operation "the most frequently visited page was the error message," says the CEO. He attributes most of the problems to haste: in order to fulfill its commitment to a partner, edu.com had to launch in time for the back-to-school season, which left just two weeks for testing.
Adding to the stress is Kanner's heavy business-development schedule, which has kept him out of the office and remote from what he now considers critical decisions. "I didn't even see the problems until the site went live," he says. "I went on to check what we were charging for a Targus computer bag that I had seen advertised on another site, and I couldn't find it. It took me 10 minutes just to figure out how to search for it. I couldn't believe that a business grounded in creating a best-of-market commerce experience was this disaster of consumer unfriendliness. It made me almost explode."
On that occasion Kanner charged down the hall to confront the person who was ultimately responsible for the mistake: his mother. "She was just as upset as I was, but we had to have this conversation that said, 'You dropped the ball, and how are we going to fix this thing?" says Kanner, sounding like anything but a mama's boy. "There's probably a downside in this for her in that I hold her to standards much higher than I hold any other employee. I always thought my mom was perfect. Now I'm getting to know her better, and you know what? She's a real person who makes mistakes."
Leigh Buchanan is a senior editor at Inc.
Read the complete Start-Up Diaries series.
Executive Summary
COMPANY: edu.com
FOUNDER: Adam Kanner, 29
FAMILY: Single
EDUCATION: B.A. in government from Harvard University; M.B.A., also from Harvard
TYPICAL WORKWEEK: 90-plus hours, much of it spent on the road raising money and negotiating with potential partners. "I have no life," Kanner says.
CONCEPT: Create a Web site where major consumer brands can win the dollars and loyalty of college students -- a market that is hugely wired and poised to embark on a lifetime of spending -- by offering best-in-market pricing on everything they need for school
FINANCING: $1.8 million from Information Technology Ventures, $2 million from the Mayfield Fund, and $150,000 from private investors
PROJECTIONS: Profitability by the end of 2002
HURDLES: Getting noticed in an electronic marketplace as noisy as a frat party; competing with a slew of other student-hungry start-ups; quickly assembling a mighty technology team and bringing the site up to snuff
PERSONAL FUNDS INVESTED: Zero
EQUITY HELD: The largest slice of the company pie
SALARY: Enough to live on
PREVIOUS JOB: Account manager at ad agencies J. Walter Thompson and Saatchi & Saatchi
SOURCE OF IDEA: Years spent helping major marketers sell to college students combined with his own miserable experiences as a college student trying to buy stuff
BOARD OF DIRECTORS: Jeffrey Rayport, associate professor of business administration at Harvard Business School and a specialist in digital commerce; Michael Bronner, chairman of direct-marketing agency Bronnercom and originator of the idea to distribute free coupon books to college students through their campus mailboxes; Tony Menchaca, former chairman and CEO of CUC International and founding partner of venture firm eCom Partners; Michael Levinthal, partner in the Mayfield Fund; and Virginia Turezyn, cofounder and general partner of Information Technology Ventures
WHAT HE DREAMS ABOUT: Building a sustainable business that in a perfect world would be a leading multibillion-dollar company; making a lot of money for his mother
WHAT HE'LL DO IF THIS FAILS: Return to the world of corporate marketing until the time is ripe for the next start-up
SOURCE OF INSPIRATION: The desire to control his own life; the college students from whom edu.com seeks constant feedback and reinforcement; his overachieving family
ROLE MODELS: His mother and his grandfather. ("He built a company [J. Baker, operator of Big and Tall stores and other apparel retailers] from the ground up the hard way over 50 years and is still giving good advice," says Kanner.)
