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Published in U.S. 1 Newspaper on July 7, 2000. All rights
Dow Jones, a Stepping Stone to the VOCs
It’s after the dot-com shakeout, so investors are
a little more nervous about Internet companies, yet two former Dow
Jones executives are busy working in dot-com enterprises.
If the journalism challenge of the 1990s was how to deliver business
news online, then Dow Jones was an early and successful pioneer. The
next hot idea for this decade seems to be delivering business news
online to niche markets by creating what is known as "vertical
online communities" (VOCs). Two executives, Craig Allsopp and
Tim Andrews, have left Dow Jones to go off on their own to develop
Craig Allsopp started a brand-new company with support and investment
from other Dow Jones alumni. Less than 12 months ago, Allsopp was
the only fulltimer at the Straube Center-based company. Now he has
a staff of 32, three vertical online communities, and is growing by
the week. He has already made one dramatic change in his business
plan and has changed the company name from VertiNews to Internet
Direct (www.IPGdirect.com). See story on page 42.
Tim Andrews left Factiva, a privately held Dow Jones and Reuters
for another "business within a business" in the VOC space.
For Primedia, a 7,000-person targeted media company that owns 47 trade
shows and 250 magazines, including New York and Seventeen, he is CEO
of IndustryClick.com. After six months doing research and planning,
he is hiring vice presidents now. By the end of the summer
will move from Primedia’s building in Hightstown to 20,000 square
feet at 155 Village Boulevard in Forrestal Village, and he expects
to grow to 200 staff members by the end of the year
Both Allsopp and Andrews unabashedly doff their caps to their alma
mater and their colleagues at Dow Jones and are determined to build
on what they have learned to achieve personal success. They have
different business models and are 10 years apart in age, but the chief
difference is that Allsopp is starting from scratch and is raising
his own funds in contrast to Andrews, who is tapping a public company.
Nevertheless, Andrews has no illusions that he will
have an easy time of it. "We are clearly a start-up company inside
a $1.7 billion company, moving from a handful of people to a couple
of hundred, starting everything from scratch including mail service
and E-mail service."
As president and CEO at Factiva, he spent most of his time either
on the road or with customers. Here, he spent the last six months
evaluating work already done and planning how to, as he puts it,
out the opportunity we have here and also hire a senior team."
Offering salaries at market rates plus equity participation, Andrews
has pared the 50 workers now at Primedia headquarters in Kansas City
down to 30 people and is moving a half dozen more to Princeton.
else will be a new hire and work here.
Andrews expects to dedicate six to eight online editorial workers
to each community in addition to the print magazines’ staff and
sharing between technical, sales, and marketing people.
Andrews’ staff includes CFO Andrea Goldschlager (a Wharton MBA
with Salomon Smith Barney), and a former Factiva employee, Keith
as chief technology officer. He has these vice presidents: Pat
(for product development, formerly with Factiva); Philip Berg (for
business development, an alumnus of University of Virginia and Harvard
Law); Karen McClendon (for human resources, formerly with PBS’
Television Workshop) and for sales, Jack Bamberger (formerly with
Time Inc.). His vice president of affiliate relations, Jacquie
was on board when he came and is based in Kansas City. He was
for a vice president of marketing at press time.
Andrews is clearly not satisfied with the six VOCs that he inherited:
Three were developed within the Primedia family by trade magazines
for telecommunications, agriculture, and wireless communications.
Three were bought: PromoXchange from Intertec Publishing, Media
Central from Cowles Business Media, and Digibid, a real-time
auction site for the sale of audio and video equipment and musical
instruments. He will reshape what was done before he came.
"The sites up today are first generation. None were built after
I arrived," says Andrews. "We will be doing a lot more content
creation, including video and audio news." He plans for these
products, and others he will launch, to have a basic core but be
for each industry. "We have communities with advertisers and
today, and they are served by magazines in the business to business
space, but we will build these communities on the web."
Labeling himself "methodical and businesslike" Andrews claims
not to be in a rush. "Being first to market is sometimes
but being best in market is always important," he says, noting
that Microsoft has almost never been first in its marketplace.
"I am a big believer that you can’t labor over something forever,
but one of the big mistakes an Internet company can make is that you
can build whatever you want and spend unlimited amounts of money `and
they will come.’ We spent considerable amounts of time with people
in the industries we are targeting," says Andrews, "talking
about decision making and information tools that will help them in
His biggest surprise: "How many assets Primedia really has in
the B to B space that we can use to create IndustryClick. As you can
imagine it was not an easy decision to leave Dow Jones, and I did
a considerable amount of research, but even after all my research
I was surprised at the phenomenal assets here."
Primedia bought K-III Directory Corporation on 10 Lake Drive in
and is now the nation’s largest provider of directories for apartments
and new homes. In 1998 it sold the Daily Racing Form for a reported
$400 million. Its lengthy consumer magazine list includes Modern
American Demographics, and Sail, and its trade rags range from Textile
World to American Trucker. In the education area it owns Channel One,
an educational channel for schools, as well as the 65-person Films
for the Humanities & Sciences on Perrine Road (www.films.com).
Andrews reports to David Ferm, president and CEO of Primedia’s
to business group. Ferm is responsible for the more than 90 technical
and trade magazines and newsletters, 31 trade shows, and 450
and technical books, plus Bacon’s Information, Federal Sources Inc.,
and Simba Information, a consulting service.
A bachelor with a home in Princeton on a one-acre lot
filled with roses, peonies, and azaleas, Andrews is in quite
circumstances now (and deflects an intrusive question about how much
salary he is earning with the quip ("more than you’d think"),
but he started out quite differently. He grew up near Columbus,
where his father was a factory worker, and says, "we were really
poor. We had nothing. From my mother, I learned that nothing is easy.
I heard her say it a thousand times, that the effort is always worth
His first reporting, in second grade, was typing a one-page
newspaper on the kind of toy machine that selects one letter at a
time. Now his tools and luxuries include a BMW 323-I, a Palm Pilot
and a cell phone that is always on, but for Internet access he
himself an "old-fashioned AOL user," at least partly because
he can access a local AOL number anywhere in the world.
He majored in journalism and economics at Ball State, Class of 1984,
and joined Dow Jones early in his career. A stint working for Ogilvy
Adams Rheinhart facilitated the transition to marketing. "I wanted
to move in to marketing, but you had to leave to get people to listen
to you," he remembers.
Hired back to Dow Jones, he ran Dow Jones Interactive, managing it
as a separate business before it merged with a similar entity from
Reuters, and he ended up on top as chief of what was named Factiva,
a Dow Jones and Reuters company. Andrews names Dorothea Coccoli Palsho
as his Dow Jones mentor and describes her as, "the most patient,
understanding, supportive person I could ever have possibly imagined,
and smart to boot. She really taught me everything I knew about
Most broad publications don’t do a good job reporting on a particular
industry, he says. "The people that may be the hardest to reach
are focussed on an industry, and they want expert opinions on that
To reach these people, Primedia sites combine editorial content from
print magazines with licensed content. He predicts that another
company, Workplace Learning, is going to help in the audiovisual area,
particularly when bandwidths expands. With its video and audio
of skills-development tools Workplace Learning can be used to cover
a trade show in real time.
His marketing plans involve both standard web marketing and
marketing, usually defined as E-mail newsletters. "The 4 million
readers of our print magazines are going to create quite a lot of
cross-promotion of editorial content to web content. We will also
have appropriate partnerships for creation of news content to drive
traffic back to the web," he says.
His business model is under study but will certainly include both
advertising and sponsorship revenues, and might include paid content
or services, including training or skills certification. Eventually,
Andrews says, his VOCs will do business transactions, as with a
property, Digibid, for musical equipment auctions.
Andrews says he holds several aces, including the built-in audience
and cross promotion that he can leverage, and the underlying content
that his magazines generate each month. "We are not necessarily
going to be first," he says, "but must simply work hard to
be the best."
— Barbara Fox
08520. Timothy Andrews, CEO. 609-371-7700; fax, 609-371-7879. Home
Craig Allsopp remembers his grandfather’s crotchety
advice, that it is far better to own a piece of a company than to
merely sit on the sidelines. "I was a hippie back then," he
says, "but it must have been resonated with me. I didn’t want
to work with a large company. I wanted to be involved with something
where I could make a difference, have an ownership position, and be
closer to home. With this new company I have been able to recognize
those four personal goals."
Allsopp left Dow Jones to head a new kind of company, Internet
Group Direct (www.IPGDirect.com), and he has grown the company in
one year from just himself to 32 people. "We’ve got some
we have revenue-generating clients, and our target date for breaking
even . . .," he pauses a beat, "is as soon as possible."
To get so far so fast, Allsopp has had to take advantage of a
characteristic strength: the ability to turn on a dime. He has already
made a dramatic change in his business plan and changed the company
name from VertiNews. The original business model was to create
Online Communities (VOCs) that would facilitate business to business
(B to B) markets, and two of these have been launched.
"We were going to offer better content than people had access
to in online and offline publications," says Allsopp, "and
we were going to be more targeted than the general interest business
That was a good strategy to get the company going, but as Allsopp
points out, "It required hitting bullseyes with every single
we put into the marketplace and put us into competition with every
publication in the offline market, every trade magazine, every
that people had been using to get their information."
"We got good traction right from the start," he claims.
three or four months from launching the first VOC, for commercial
real estate, he discovered that other real estate websites would be
interested in information to enhance their sites. "That interested
us in developing a syndication model to serve the much larger market
of people using existing websites, and it got us going into the
for commerce, or C for C business. We started using a whole new
We embarked on C for C for newsletters and websites to provide expert
RealtyIQ.com sponsors the actual newsletter, but Cushman Wakefield
signed up for its own version of commercial real estate information
to stimulate use of its corporate intranet.
One of the prestigious B to B exchanges, Ultra Energy Technologies,
also signed up. "They are making the market, linking up the buyer
and seller, and if they bring people back into the sites time and
time again for perspective on the marketplace, they end up making
more transactions," he explains. For this Houston-based company,
IPGDirect.com is providing a customized service, called Traders News,
for those who are trading natural gas.
Meanwhile Allsopp was spending lots of time on the road to bring in
second-round financing, and when the money came in earlier this year,
he changed the corporate structure, and signed up to be a portfolio
client of the prestigious money-brokering firm, garage.com. Such firms
screen entrepreneurial companies, select a minuscule percent, and
match them with the right investors.
Though it has redirected its focus, IPGDirect.com has not abandoned
the VOC market. It has retained its two initial VOC E-mail
the one for commercial real estate and another for buying and selling
Asian assets, and it is making them available on a custom basis.
The top stories on a recent day for Asian Assets Direct dealt with
new listing rules for IPOs, a $4 billion deal for two multimedia
and a Japanese firm pioneering in selling other company’s securities.
The newsletter also had several stories on Korea, including one that
noted South Korea’s national income was 25 times greater than North
National stories comprise Commercial Real Estate Direct, but each
has such juicy Manhattan-based news as the quick-turnover of a Soho
property with a potential for $16 million profit in six months, or
a For Sale sign on a cliff site overlooking the Hudson River on which
to build luxury apartments.
IPGDirect’s latest product is a C for C service for the
capital market (www.istartupsdirect.com), edited for the startup
equity marketplace by Eric Kramer. A graduate of Kansas State with
an MBA from St. Peter’s, Kramer had worked at Associated Press, United
Press International, and Dow Jones.
"The strategy for istartupdirect.com is the same as for all our
C for C services," says Allsopp. "We will provide both
of real time news — and original content that will be coded,
and accessible. So if you are interested in high tech companies in
start-up space in New Jersey, any time we have a company on that radar
screen, we send you an E-mail. It is a way to filter dozens of
The primary users:
of companies they might want to follow.
have trouble finding what is pertinent for their beats.
Providers pay a fee to be listed in a directory. Allsopp entertained
the idea of doing the actual service or brokering it, but now he feels
it is not the right use of his firm’s resources.
only by the number of reporting hours available. "Far more
are being created than we will be able to track," says Allsopp.
Sources will include news and business wire services, trade shows,
and networking. "We want to pick them up early as soon as they
come out of the chute," says Allsopp, "and then we want to
track them over time until they hit the jackpot with an IPO, or merge
with another company, or continue on as a privately held company."
Advertisers will benefit from a quasi-brokerage service that istartups
will provide. Entrepreneurs, for instance, can be matched up with
business service providers listed in a directory. "We charge the
provider to be listed, but are not going to take a broker’s fee,"
says Allsopp. On the other side, it will provide a service to the
business community by disclosing where and what the start-ups are.
The website is undergoing a major redesign to be launched this month.
The need to do major overhauls on his websites does not trouble
"The best research you can have is from the marketplace,"
he says. He has a brother who was a Marine, and he follows the Marine
Corps axiom: Get things 75 percent right first. Then let the
shape and refine it. "We have been fortunate in being able to
Allsopp still has a 60-hour work week, but instead of
taking a 7 a.m. train to New York and returning at 7 p.m., he has
more control over his schedule and more time with his family. His
wife works for a dentist in Princeton and they have three children,
two in high school, one in college. "When your office is local,
your work and your personal life blend. I was able to watch six or
seven of my son’s JV lacrosse games and come back to do my E-mail.
You tend to have more flexibility in your life. And then there is
the philosophical question of what’s work. When I am out riding a
bike and thinking about work, am I working or am I exercising?"
He tells a work/family blending anecdote, about how his son Eric was
hanging out in the office and was paging through the business plan.
Suddenly Eric announced the numbers were wrong. Says Dad: "I added
the summary data in financial tables and it was off by several hundred
thousand dollars. We had relied too heavily on Excel spread sheets
and not enough on quick summary math. My 14-year-old was right. I
think even the auditors missed the error."
Born in Chatham, where both his father and grandfather were in the
insurance business, Allsopp went to Davis & Elkins in West Virginia,
Class of 1973, and has a master’s in journalism from Penn State. After
being a reporter at UPI he thought of buying a weekly newspaper in
New Hampshire, until he made a site visit. "It was the
New Hampshire town, and I realized I needed a little more action in
my life and wasn’t quite ready to settle down."
He spent 17 years at Dow Jones, where he helped develop Dow Jones
News Retrieval, and he was vice president for U.S. sales at Dow Jones
Markets/Americas when Telerate was bought by Bridge Information
"I had no desire to work for Bridge," says Allsopp. Going
on his own " has been a lot of hard work but a lot of fun and
very gratifying. We have built something pretty solid that has a great
"In this new world — some compete, and some collaborate,"
he says. "We moved pretty quickly and established ourselves in
two marketplaces, and we have done a pretty good job in showing we
can compete with the big boys. We have a pretty good strategy, and
pretty good customer relationships."
What is harder than expected: "It is harder to raise money than
the popular press makes it out to be. It is a lotta lotta work. I
spend a lot of time trouping out on the west coast, refining the
plan and the business model with Chris Bouck (the CFO hired in
fine tuning the strategy, and fine tuning the presentation. It is
a constant work in progress."
What’s easier than expected: "Recruiting good people has
been a little easier than I thought. We have a great group that has
a lot of energy and enthusiasm," says Allsopp.
Allsopp has a Pollyanna reply to the idea that Wall Street looks less
favorably on dot-com companies than it did last year. "Obviously
the window has shut a little bit but I honestly believe that for
with good business models a lot of noise will be removed from the
marketplace, and good companies will find it easier to get
The two companies that are headed by Dow Jones expatriates Andrews
and Allsopp would seem to compete with each other. But Allsopp’s new
business model takes away the worry about going head to head with
a bigger firm, and Andrews might very well turn out to be Allsopp’s
client. Instead of focusing on putting its own vertical online
on the web, Allsopp’s IPGDirect.com is changing to provide content
to other VOCs, like the ones Andrews’ IndustryClick will host.
Mark Feffer, founder of Tramp Steamer Media LLC on West State Street
in Trenton (www.trampsteamer.com), has worked for both men. Feffer
says that Andrews is very dynamic and tends to have a loyal following:
"A lot of people were very upset when he left and followed him
out of Factiva." Andrews’ management style, Feffer suggests, is
loose-reined. "If he brings you into his group, there is an
about your knowledge, and he backs you on it, and he builds very
teams because of that. Moving Dow Jones News Retrieval on to the web
was not an easy thing to do. He really pulled it together. His
is in building new products."
About Allsopp, Feffer says that he is "a good manager who knows
how to run a business, manage a team, and what needs to be focused
on at any moment." He admires Allsopp’s flexibility.
their business model is an example of how they got feedback from
They haven’t let themselves get married to a model."
— Barbara Fox
108 West Franklin Avenue, Straube Center Suite I-20, Pennington 08534.
Craig O. Allsopp, chairman. 609-730-4860; fax, 609-730-8652.
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