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- I. The Internet - It's the End of the World as We Know It
- II. Mecklermedia Publications and Trade Shows
- III. Mecklermedia Beginnings
- IV. Mecklermedia Meets the Internet
- V. Internet World Trade Show - Thank you Lotus
- VI. Going Public
- VII. Challenges and Obstacles
- VIII. The Future
I. The Internet - It's the End of the World as We Know It
One of the most powerful events in the twentieth century, that revolutionized both business and global communications, was the birth and commercialization of the Internet. What started as a United States Department of Defense project to network computers throughout the United States, now penetrates most parts of the world. Our world has changed immeasurably, as people can sit in front of their personal computer(PC) linked to the Internet, and surf to another computer anywhere on the globe, to find information about any imaginable topic. If the computer masters of the world, such as Larry Ellison, Bill Gates and Marc Andreessen, have their way, the Internet will permeate our society beyond the PC: to "net-ready" appliances connecting our televisions and telephones, and maybe our toasters, to the Net.
Millions of people across the globe have jumped on the Net bandwagon to participate in this virtual world. The Net is growing daily by leaps and bounds. This excitement and participation has spawned thousands of companies, who want to capitalize on the consumer demand for products and services. This relatively young industry has made more shareholders of companies - such as Netscape Communications, Cisco Systems and UUNet- into millionaires than Apple Computer and Microsoft combined. Even so,this industry continues to struggle with its growth and the regulatory battle between companies and government agencies. Many of the interested parties are working to establish technological standards and business practices to improve upon the quality and stability of this nascent technological infrastructure.
News and multimedia companies are attempting to organize this burgeoning information behemoth. The media business stands to benefit greatly from this opportunity, by supplying consumers with comprehensive sources of data. In this frantically developing industry, the Mecklermedia Corporation has become the premier Internet media company. With print magazines, including Internet World, Web Week and Web Developer, and the paramount Internet trade show, Internet World, this organization has seized the opportunity to become the leader in this information market.
Alan Meckler is the founder of Mecklermedia. He realized the potential of the Internet in the early 1990's; long before any of the preeminent media companies. When Alan approached these groups for funding or the offer of a joint venture to promote his media resources on the Internet, he was turned down and considered "nuts" for pursuing this idea. With a simple newsletter and two decades of experience in creating media resources and trade shows for less mainstream topics, Alan has built Mecklermedia into the leading provider of Internet news and analysis. He company had gross revenues of $14.5MM in 1995. Located in Westport, Connecticut, Mecklermedia has grown from thirty employees in the early 1990's to 135 employees in the summer of 1996. His three magazines have a combined paid and controlled circulation of over 400,000, and his trade shows are held in over twenty-five countries. The EM met with Alan to discuss Mecklermedia's meteoric rise, the strategy and wisdom he developed along the way, and how he survived for over twenty years in search of the almighty "big one" of a business opportunity.
II. Mecklermedia Publications and Trade Shows
Mecklermedia's media resources includes magazines, trade shows and its Web site. Each resource is managed by a separate division. The following list offers a brief description of the media resources and clarifies their scope of activities:
1. Magazines -
Internet World supplies information and analysis about issues, trends and technologies that are shaping the Internet. The estimated paid subscription base of Internet World is 302,000. Web Week is a controlled-circulation periodical, providing over 100,000 subscribers with news and analysis about the latest Internet and Web technologies. Web Developer assists technical professionals and programmers to build, design and maintain Web sites, by offering in-depth tutorials, product testing reviews, case studies, programming tips, and interviews. The paid circulation base is approximately 30,000.
2. Trade Shows -
Internet World is the largest trade show in the world presenting products, companies and information about the Internet. Started in the fall of 1993, this trade show is now held in over twenty-five countries, with the attendance for each venue numbering over 10,000. Web Developer is the first trade show devoted to the technical considerations of Web site planning and strategy. Web Interactive is the first conference and exhibition dedicated to interactive multimedia and Virtual Reality on the Internet.
3. Web Site -
iWORLD is an electronic newspaper that provides news, information, and resources necessary for conducting business on the Internet. Daily news is provided by iWORLD's editors, and iWORLD also hosts the online versions of Mecklermedia's publications. File libraries of Internet tools and programs, and links to commercial products are stored on the Web site. iWORLD 's Web site traffic is estimated by Mecklermedia to be three million page views per month.
III. Mecklermedia Beginnings
"I was working for a scholarly book publisher who was in the microfiche and microfilm industry, and it was a very new area for the world and for universities." The job with the publisher was one of the two publishing jobs Alan held within the span of two years, after graduating from Columbia University in 1968, with a Master of Arts in American History. Ultimately, he received his Ph.D in 1980. "I recognized after watching the library publishing business for one to two years that there was a need for a publication that reviewed publications that came out from this medium for libraries." Alan left his first job to start Mecklermedia. The company started in 1971, as a publisher of professional journals for microfilm and microfiche technology.
His work in publishing laid the foundation for Mecklermedia's commercial offerings. "We published information about microfiche and branched out doing other scholarly reference type works like newsletters and journals and database directories in a variety of fields to include computers, legal, baseball, and business information." At one point, Mecklermedia was publishing nearly thirty newsletters and magazines, with none of them having a circulation greater than 3,000. "All of these still exist, I think I started 27 to 30 newsletters and all have been sold and thrive under the banners of other companies." Mecklermedia also published twenty different annual directories for university, corporate, and public libraries. "My modus operandi was to find a subject, hopefully not too esoteric, where it was required for someone to have a body of information presented to their desk by print means mostly. I would either start a newsletter or a magazine if it lent itself to being a magazine. We would then try to create a marketplace or database directory of all the organizations or products in that area. Then when possible we would try to create a seminar or trade show in that area."
Alan's publishing approach was to become an authority on an industry, and then to create a publication to provide that industry with timely information. He wanted his organization to understand the industry, so it would be attuned to its readers' needs. Alan had great faith in his abilities to present the detailed facets of an industry, so his publication would appeal to its target audience. "Because of my background as a historian and trained scholar I feel I have the ability to recognize what was and was not necessary." His ideas for new publications and media resources come from his wide-range of reading interests and to speaking with people. "When it came to learning about how to publish a magazine or put on a trade show I was always naive and thought I could pick it up quickly. I used to get on the job training by going to other shows and learning what they would do. I learned that direct mail was the key to obtaining people to come or register to seminars. Selling booth space was like selling ad space and that was fairly obvious with what to do."
This strategy was the foundation of Mecklermedia through the 1990's, until it began the ride on the Internet. "We had a nice little business and were considered one of the best in the field." In the 1970's, the organization consisted of Alan and his wife; it had grown to six employees by the end of the decade. From the 1980's to the early 1990's, the company grew from fifteen employees to nearly thirty. Alan's extensive media experience allowed him to continually funnel opportunities through his company, which eventually led to his introduction to the Internet, "It was because of this background that I learned about the Internet in 1990."
IV. Mecklermedia Meets the Internet
Alan was always looking for new products to develop: primarily in newsletters, seminars, and directories. At a dinner in March of 1990, a librarian from the University of Maryland mentioned to him that the Internet would be the next great medium for libraries. "When I heard it it immediately dawned on me that not only was she right, but it was probably the best information delivery medium I had ever heard of. I still have the original notes from that meeting and I started a newsletter in this field. It all started with a newsletter." Mecklermedia applied its business practices to this newly discovered technology topic, and thanks to Alan's correct forecast, it has prospered in this now-lucrative technology arena.
What are Alan's thoughts on his ability to assess a media opportunity? "It is something that you are born with or not." He feels he is fortunate to possess this acumen. "Over the years I was the first person to recognize the power of audio tapes with books. We created the definitive reference work of the value of books on audio-tape in the 1980's." He recognized the potential of CD-ROM before his competitors, and created a newsletter about it in 1983. Mecklermedia created the definitive database on CD-ROM in 1987. "I am not always right you understand. I thought HDTV would be great in 1987 and it wasn't and it cost us a lot of money. I did work in Virtual Reality which did okay for two years and then went no-where." Alan feels he was the first to grasp the commercial impact of the Internet. "I don't think anyone was ahead of me including luminaries such as Gates."
When the Internet increased in popularity, Mecklermedia concentrated more resources on its products and services for the Internet. "It was very obvious this was going to be successful so there was no dilemma that we would start to focus the business and resources to meet this demand. The power of subscriptions coming in for the magazines, the registrations for the trade shows and the power of the sales of the booth space was incredible. It's like comparing an atomic bomb to a fire cracker in terms of our other products so there wasn't a dilemma at all. There was no comparison to what I had done before. I had never seen anything like it before so there was no problem in not working in other areas and concentrating on one specific area."
To meet the demand for its publications, Mecklermedia modified its corporate outlook, and became completely focused on Internet media resources. "It means that we are totally devoted to reporting information about the internet for those that provide the goods and services and those that use them. We are the middle-ground between those two groups, and to use those information mediums that we think will do the best in getting that information in to those hands." The company had decided to sell its businesses that were not as lucrative as its Internet activities. "We started to think about shedding some of the other business areas Mecklermedia was involved with while the Internet started to grow rapidly in 1994. We shed CD-ROM in the Fall in 1994 and VR in the Fall of 1995. We decided that in the case of CD-ROM it was strictly a transitional media that had no future other than delivering large files of information. In VR it had involved into a subset of the Internet and not its own stand-alone technology."
Now that the company is firmly established within the Internet industry, Alan has no intention of straying from the market that has contributed greatly to his personal and business success. "When you have the atomic bomb exploding in your face its a pretty stupid thing to consider spending one iota of effort on anything else than that one thing. I never had anything that was so overwhelmingly popular or had the potential for profitably. When you have an explosion like that you have to be the stupidest man on earth to then try and do three other things and spread out your forces. You have to keep hitting at that one focused thing and never take your eye off the target when you've hit the big one."
V. Internet World Trade Show - Thank you Lotus
The first Internet trade show took place in the fall of 1993 in New York. The trade show was part of Mecklermedia's "modus operandi" after the creation of a media resource. "There were very few companies in 1993 that could exhibit, but based on the model of the PC I knew we'd be behind the eight-ball if we didn't get it started first. We launched, perhaps prematurely, on the exhibit side with nine companies exhibiting but got 1500 attending the seminars. I always looked at things as a trio with a reference directory, some type of periodical and seminars. It was a natural extension of everything we had been doing since 1971."
The trade show in 1993 was the result of an Internet forum held earlier by Mecklermedia. This event sustained Alan's energy to forge ahead in uncertain times. "In January of 1992 we ran a seminar in Boston that was really a pre-cursor to Internet World called Electronic Networking and Publishing. Mitch Kapor, the founder of Lotus Development Corporation, was our keynote which was amazing considering who we were and how small the crowd was going to be. That was a pivotal point in my life when things looked the bleakest. I was so inspired by his talk about where the Internet was going, which further reconfirmed my earlier hunches, that I should just stick with it. I was ready to pack it in in January of 1992. It was like going to see Billy Graham or some evangelist and being converted. I was there and I had lost faith and he put me back over the top. It was a very pivotal time in my life that that 30-40 minute talk could effect me that way."
With the overwhelming public response to the Internet trade show, Mecklermedia capitalized upon this opportunity. "We're the biggest in the world and pulling away on a daily basis. Internet World is not only pushing the envelope on the US shows but also in 19 countries overseas, and we will be 24 to 26 by the end of October. We have not run a show that has not been successful. The name Internet World is synonymous in the country and world with quality and the nerve center of the industry." Alan feels the Internet's breadth of subjects will support specialized trade shows. "All you have to do is look at the PC industry which had Comdex which was the umbrella show. Now there are substantial vertical shows that have stemmed from there such as Interop, PC Expo or Unix Expo. The Internet too will spawn that and we believe we will be competitive in these areas as well. We believe Web Interactive has the same chance of being the next great show after Internet World. Certainly it will become the great summer Internet show in the United States."
Alan has developed a strong sense of confidence because of his company's success and its ability to maintain its market share. "Our competitors are now trying to create trade shows that we created three years ago, and we're trying to create trade shows for two to three years from now. The recent Web Interactive trade show was just held and it is probably something that isn't needed until next year." Furthermore, his confidence is buoyed by his previous prognostications and his competitors lack of foresight. "Understand that virtually every major media company particularly in the PC publishing arena turned me down when I was looking for venture capital from 1990 to 1994. I was turned down by over 20 VC firms and media companies including Ziff-Davis, IDG... you name it they turned me down. They thought I was a nut. They didn't believe in the Internet and thought I was a nut." A point his competitors are reluctant to admit. "No one wants to recognize that they missed the greatest media company development since the birth of Ziff-Davis in the early 1980's."
VI. Going Public
To keep up with demand and to stay ahead of the competition, Mecklermedia's need for funding grew sharply. An Initial Public Offering (IPO) in February of 1994, allowed the organization to increase its capitalization, and still retain control. "We were desperate for money at the time and a company approached us saying we could net $5 MM if the offering came up. I had been turned down by other investors so I couldn't see any other way of doing this. Very few people told me it was the wise thing to do, but I checked it out and knowing what I had been through for so many years someone telling me I could have $5 MM in the bank in 90 days...you tell me. It turned out to be a dream story and one that I would highly recommend it you are serious about your product."
Once the IPO was completed, Alan was comforted because he still held the majority stake in the company he had built. "The public money was just a necessity to grow. No-one wanted to acquire us and we wouldn't even have gotten $1 MM outright to sell it. We netted $5 MM for selling 35% of the company. I never felt like I gave up ownership of the company after going public. I am still the largest shareholder. The encumbrances of being a public company compared to the worries of being the sole person responsible for not making payroll or being able to expand were more than a grateful trade-off for me."
Although the company was now publicly held, Alan did not fear it would lose any of its entrepreneurial energy and flexibility. "I think we haven't lost our entrepreneurial spirit and that we still are an entrepreneurial company that is slowly evolving out of 'toddler-hood' from the new Mecklermedia of 1994. We're still very much an entrepreneurial company which is why we're taking our competitors to the cleaners because we make decisions and move on them. Our competitors would need 12 to 18 months to conceive a show such as Web Interactive where we thought of it in February, announced it in March, heavily advertised it in April and held it this summer. No other company in the US could launch a technology show that fast. This is why we're still an entrepreneurial company. The Internet moves so quickly that unless you move on things fast you are going to lose the opportunity. We launched Web Week in Australia in seven weeks and that was because of the entrepreneur Alan Meckler pushing it through."
VII. Challenges and Obstacles
Alan's challenges with Mecklermedia are an ongoing concern. "As an entrepreneur what hurt me until I hit something that was so powerful was not focusing. I could have been successful as a baseball publisher or in library technology or straight history books, but we were always in five or six different areas. You can't get the full force of all your promotions." A situation a lot of small companies experience, as they work to become successful. What was it like having so many disparate efforts and limited resources? "It was tough. Most weeks I didn't know if I could make payroll. For many years until February of 1994 there was a period of five consecutive years where about every seven to ten weeks I had a crisis of being able to make payroll. It's 90% perseverance and hard work."
Other problems have occurred since the company's recent success with the Internet, due to management's inexperience handling the operations of a larger and more demanding company. "Sometimes handling personnel has been a challenge. It's always from a naive viewpoint of just not having had the experience with the growth." Overall, Alan feels good about his company and the decision they have made in their operations, "Since 1994 we really haven't made a mistake. All the product moves have been right on the button."
VIII. The Future
What has Alan's reaction been to his success after a long career in more modest circumstances? "It's never a lack of amazement on a daily basis. It's like the greatest dream you could ever have wanting something as a kid like a toy that appeared in your head and in the morning you woke up and it was there. It's one of those great experiences that unfortunately a lot of people don't have. I've been very lucky. I'm appreciative of it every day, I think I've earned it but it's one of the most amazing stories. I think it's a great example of what can happen in America. Compared to where I am and where I was it's just a miraculous story." This appreciation augments the company's strategy of integration. "The company is now set up in a very effective way that there's nothing that doesn't sell something else. If you are interested in our publications you are interested in our web site and our trade shows. Everything sells something else and there is no wasted time or effort. There is no spinning of the wheels."
Mecklermedia's rise to success, in spite of its skeptical competitors, is a great source of satisfaction to Alan and he considers it a competitive advantage. "There is still an air of arrogance with the larger media companies that we don't belong where we are...but we got it. It's always wonderful to compete with people who are angry at you because it distorts their judgment. The various managers are all in place who turned me down between 1990-1994 and are making judgments that I don't feel are rational and their thinking is distorted. They think they are working to replace us when we won the hearts and minds of the industry with quality and aggressiveness. As long as we continue this we are not afraid of what the competitors will do. It's not a question of being taken out but of how big we're going to get. That's all we'll worry about."
With the momentum that Mecklermedia has established, Alan intends to expand the company's media publications and trade show venues with the same speed and aggressiveness. "With the Internet I have something that is good at least into the 21st century although I'm not saying I'm not looking for anything else." As for his other ideas, we will have to wait and see. "I have some things that I think will be effective ideas in 2005 to 2010 but can't discuss them and that it's not the right time to start them either independently or with Mecklermedia. I'm not going to be a baseball player like I always wanted to be, but I can't think of a better position to be than where I am now." - ###
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