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HOW TO INCORPORATE

My So-Called Life
 

In its January 2000 issue, Inc. began following five fledgling businesses. The founder of one, edu.com, shares some lessons and insights.
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Founder: Adam Kanner, 30, CEO

Company: edu.com, in Boston

Original business model: Operate a Web site where college students can buy stuff cheap and where the companies selling that stuff can do research on a student audience

Current business model: The same

Original projections for 2000: Undisclosed

Actual 2000: Sales undisclosed; unprofitable; 100-plus employees

Total capital raised from date of launch: $39 million

Some days I feel like a master chef with a really bad head cold," says Adam Kanner. "It's as though I've spent months concocting this absolutely amazing meal and then invited all these people to share it with me. Now they're sitting here, wolfing down the food and telling me how incredible everything is. But I can't taste a thing. I smile anyway because I know intellectually that the meal is a great success and that if it weren't for my decimated taste buds, I'd be enjoying myself immeasurably. And above all else I recognize the importance of setting an upbeat tone for my guests.

"When I look back over the brief history of edu.com, I'm overwhelmed by all we've accomplished. In the past year we've raised more than $35 million from venture capitalists. (We're just starting our third round now.) The company has grown to more than 100 employees. We've formed partnerships with prestigious and successful brands. And although we're not profitable yet, we're not fashionably unprofitable in the way so many going-nowhere dot-coms are. Sales this year were on course, and the prospect of profitability is real.

"Those are the facts; I know those things happened. But no individual moments of triumph or of defeat stand out in sharp relief. Much of it's a blur, as though the intensity of the experience -- of starting my first company -- has acted like a plane on my memories and feelings, smoothing them down to an illusorily even surface. My last really vivid memories are of events that occurred before I started the business. Sometimes I'll talk to people I haven't seen since then, and I'll be amazed that so many events have happened in their lives while so much of my personal life has been consumed with work and stayed remarkably the same.

"But I'm less a victim of time, although I work an absurd number of hours, than of the intensity with which I live almost every minute. My mind never shuts off. Even if I manage to get home by 7 p.m., I'll sit on the couch and think about the business. I dream about it. I wake up to it. There's no walking away. And as the stakes increase, the pressure keeps rising. That obsessiveness is part and parcel of my own personality, of course. I've always been a glass-half-empty kind of guy, not allowing myself to get too excited or confident, even at moments when other people would be uncorking the champagne. So one goal I have for myself in the coming year is simply to loosen up and try to enjoy the ride more. God knows, there's plenty to celebrate.


"My last really vivid memories are of events that occurred before I started the business. Sometimes I'll talk to people I haven't seen since then, and I'll be amazed that so many events have happened in their lives."

--Adam Kanner, CEO of edu.com

"Because I love -- love -- being an entrepreneur. Not that I consider myself wholly worthy of that title. Not yet anyway. By my definition, entrepreneurs are people who build their companies over 10 or 15 years and face all kinds of adversity: bankruptcy, the scorn of loved ones, the pain of layoffs. I haven't experienced even a small fraction of that. Not that I necessarily want to experience it. I don't have a Job complex or anything. But I'm always aware of challenges down the road, and I wonder how I'll endure when my mettle is truly tested. I think I'll come through it well, especially since I'm surrounded by a team of dedicated, passionate people. When we succeed, collectively, as a company, that's when I'll wear my entrepreneurial stripes proudly. But until then it's one more uncertainty I can torture myself with.

"Another problem is that I don't really have many people to talk to about this stuff. There's a dramatic empathy gulf that develops between people who have started companies and those that haven't: much like the gulf I suspect exists between parents and nonparents. (I hope someday to land on the parent side of that divide, but right now I don't even have time to date.) I'm the oldest of three children, and I've always been close to my brother and sister, but when I try to tell them what my life is like, they say, 'You work too hard. Get some perspective. Get some balance. Take a vacation.' That's easy advice to give but not to take, not when I'm responsible both to and for so many people.

"Folks at edu.com have become unexpectedly important to me: so much so that I feel, probably for the first time in my life, that what I'm doing is for someone other than me. Say that today you gave me this choice: 'Adam, you can walk away from this business, crazy wealthy, and never have to work another day in your life, but your investors will lose money and your employees will be out of a job. Or you can stay in your $1,400-a-month fourth-floor walk-up apartment and leave with nothing, but you will generate a return for your investors, and your employees will be happy.' I'd pick the latter in a heartbeat.

"Fortunately, not all of my relationships have suffered, although most of them have changed. In particular, I've come to know my mother, who founded the company with me, as a colleague (although I still have trouble calling her 'Linda'). After profiting from her encouragement and support for three decades, I have now also profited from her business acumen. And I've come to recognize how similar we are: both big-picture people energized by idea generation. Now that we have a new president and have segued from a start-up to an early-stage company, she's working fewer hours and concentrating on the strategic projects that are her forte. That's not necessarily a bad thing for her -- or for me. In some ways scaling back lets her be more of a mom again. I think we both like that.

"If for some reason all this came to an end and I couldn't start another company, I think I'd want to be a venture capitalist. I thrive in creative environments and love the energy, commitment, and passion of so many young entrepreneurs. Having experienced capital raising from the other side of the table, I would share my time and knowledge with abandon and strive to be the kind of VC that entrepreneurs mention gratefully in their prayers.

"But if my luck holds, I'll never have to do anything other than start companies. And maybe, someday, I'll feel comfortable calling myself an entrepreneur."

Updates on the other four businesses featured in the Start-Up Diaries:
Suspended Animation
Unsentimental Education
That Was Then
Confidence Man

Read the complete Start-Up Diaries series.


THE START-UP ISSUE

Part 1: Your Way

Part 2: Anatomy Update -- Big Plans

Part 3: The Start-Up Diaries -- Year One


Please e-mail your comments to editors@inc.com.

Last updated: Jan 1, 2001




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