 
|
|||||||||||||
              
|
Web encounter opens a portal to big profits
Monday, May 15, 2000 By Teresa F. Lindeman, Post-Gazette Staff Writer
Jason Wolfe and Barb Sherman have never met -- never even talked on the phone. He's a guy who taught himself Internet programming skills while laid up from a car accident. She's a veteran coupon clipper who discovered the online world in 1997.
Today, the sale of an online coupon site they've nurtured together is scheduled to be announced. In a cash-and-marketing deal valued at $23 million, California-based Save.com is buying both MyCoupons.com and DirectCoupons.com from Green Tree-based DirectStuff.com.
About 50 percent of Save.com is owned by Valassis Communications, a public company that last year reported revenues of almost $800 million, much of which came from distributing those coupon inserts that fall out of Sunday newspapers everywhere.
Under the terms of the deal, the 22 employees of DirectStuff.com will continue to manage and market the two Web sites, as well as take over management of the new owner's grocery coupon site, for at least two years.
"It's not like we're riding off into the sunset on our yachts," said Wolfe.
But for him, and for Sherman, the sale proves they've come a long way in just a few, pretty intense years.
The story begins with the 31-year-old Wolfe, who a decade ago wasn't on track to become an Internet executive. A 1992 business graduate of Bloomsburg University in north-central Pennsylvania, he moved to Pittsburgh because it was the nearest big city to West Virginia University, where his then-girlfriend was going to school.
He founded his company with the bright idea of packaging coupons with the videos that people rent.
That same year, 1994, he was in a serious car accident. He required two spinal surgeries that kept him flat on his back for a long time. "Lying there, the only thing I could do was do stuff on the computer," Wolfe remembered.
So he taught himself hyper text markup language -- HTML -- and graphics, and started building Web sites. "Coupons were in my brain at the time," he said.
The first was named Coupons Direct, a sort of newsletter about coupons that would later be renamed DirectCoupons.com. Then he started the Internet Coupon Directory, a central location to get coupons, which would eventually become MyCoupons.com.
His third site -- a grocery coupon delivery service called Centsoff.com -- was a team effort with a programmer from New Jersey he had met online. The partner eventually bought him out.
Somewhere in the middle of all this, he and his girlfriend split up. A broke Wolfe spent about a month living out of his 1988 Jeep, which had an unfortunate tendency to leak during rainstorms.
But he kept working on his Web sites. A friend with a small business in Shadyside let Wolfe set up his laptop in a corner. Eventually, his friend let him sublet the whole loft for an apartment.
In early 1997, Wolfe noticed one woman was a frequent contributor to the chats on his Internet Coupon Directory. "I would see Barb in there posting messages really late at night," he said. "She was always really positive."
He decided to shut down the forum -- he couldn't keep up with it -- but he e-mailed Barb Sherman, of Homosassa, Fla., to see if she'd like to search the Internet for deals that she could then post on the site.
He offered her $50 a month. "He said it was all he could afford," said Sherman.
Sherman describes herself as a 20-year veteran of clipping coupons and mailing in rebates. "It's a cardinal sin to walk into a grocery store without coupons," she said. The grandmother in her late 50s proudly notes that even her grandchildren have learned the value of a good coupon.
Sherman had worked in claims adjusting, real estate, even reporting for a local newspaper, but when Wolfe discovered her, she was in a retirement spurred on by painful arthritis and back problems. That gave her time to discover the Internet through a computer set up in her kitchen, and to join the growing community of online coupon fans.
In her new role, she turned up free deals for everything from Alka-Seltzer to Tide. Wolfe noticed traffic to the site was increasing because she'd amassed a collection that couldn't be found elsewhere.
In late 1997, he brought back the discussion section and asked Sherman to act as moderator, answering questions and checking postings for suitability.
Things were going well, but they hadn't ever chatted on the phone or met. Wolfe decided they'd better not. "We can't jinx this."
The MyCoupons.com site now boasts 15 million page views monthly and is projected to double that by year end. Sherman, who now makes a decent salary and holds company stock, supervises eight moderators all working from their homes around the country. About 3,000 messages arrive daily, and each one must be read before being posted.
An industry tracking group recently ranked both MyCoupons.com and DirectCoupons.com among the Top 10 online coupon sites.
The DirectCoupons.com weekly newsletter claims 450,000 subscribers with a growth rate of about 1,000 a day.
The Green Tree business got a vote of confidence last year when venture fund internet.com Corp., of Westport, Conn., invested $500,000 and became a part owner. Wolfe expects the deal with Save.com will bring even more resources, including regular exposure in the coupon inserts distributed by Valassis.
Save.com chief executive Bruce Ettinger said he was particularly interested in the community of users the company's management has built through the two Web sites. He wants to tap into Wolfe's talents and help the businesses really take off.
DirectStuff.com isn't selling all its divisions. The business also operates DirectLeads.com, a network of online publishers who accept ads; DirectCertificates.com, an online gift certificate business; and several newsletters shipping out recipes and information on freebies by e-mail.
But Wolfe and Sherman had always promised they'd meet in person if the MyCoupons.com site that she's moderated was ever sold. So he and some other company employees are finally heading down to Florida later this week.
Sherman, for one, can't wait. "I'm planning a grand entrance," she said, laughing.
|
||||||||||||
