Authors: Michael Ridpath
March 2000, three months later, Clerkenwell, London
‘A hundred and eighty million! You think Ninetyminutes will be worth a hundred and eighty million?’
The American woman held Guy’s incredulous gaze. ‘Absolutely.’
‘Pounds or dollars?’
‘Pounds.’
‘Wow.’
I shared Guy’s sentiments. We were in the Ninetyminutes boardroom with Henry Broughton-Jones and two representatives from Bloomfield Weiss, a big US investment bank that was hot on technology in the States and was trying to transfer those skills to Europe. We had been besieged by bankers over the previous two months. They all wanted to take Ninetyminutes public through an IPO, or initial public offering. This would involve listing our shares on the London Stock Exchange and the Neuer Markt in Frankfurt and raising money from the investing public and institutions. We had decided to appoint Bloomfield Weiss to guide us through the process.
The two investment bankers were about our age. One, the banker, was a smooth Brit with oiled-back hair and a permanent frown: he acted as the front man. The other, the well-groomed American woman who also wore a permanent frown, was an analyst. She had a record of boosting new-economy shares in the US and was beginning to do the same thing on this side of the Atlantic.
‘How do you come up with that number?’ I asked. ‘Last week you were talking about a hundred and thirty million.’
‘This market’s hot,’ said the analyst. ‘The smart US investors who’ve made a killing on the Internet in the States over the last twelve months have started looking over here for opportunities. Individual investors in the UK have gotten the internet bug, volumes are going through the roof, they’re all trading stock tips on electronic bulletin boards. Lastminute.com is coming to market in a couple of weeks with a valuation of three hundred and fifty million. Everyone’s clamouring for stock. A hundred and eighty million for you is doable. Very doable. Maybe we’ll get more.’
‘And how much new money can we raise?’
‘I think we can go for forty million. We want to leave some investor demand untapped so the stock goes up on the first day. It’s important to get upward momentum. These days investors are buying stocks that are going up simply because they’re going up. It becomes a virtuous circle. And one that we want to get started.’
‘But none of my forecasts show we’ll ever be able to make enough profits to justify those kind of numbers,’ I said.
‘Doesn’t matter,’ said the banker. ‘We’re not allowed to show the investors your forecasts anyway. Don’t worry. These guys are smart. They know what they’re doing.’
‘Are they? It doesn’t sound smart to me.’
The banker’s frown deepened. ‘You’ve got a great story to tell, David. And you’re going to have to tell it many times. You’ll have to believe it. You’ve got to get with the programme or get off the bus.’
‘Come on, Davo, get with the programme!’ said Guy, poking just a little fun at the mixed American metaphors dropping so pompously from the mouth of the British banker.
‘David, we’re the sellers here,’ Henry said. ‘The higher the
price we sell at, the more money we make. It’s as simple as that.’
‘He has a good point,’ said the analyst, matching her colleague’s frown. ‘We need management’s commitment to make this thing work. We’re going to be taking you to see investors right across Europe in three weeks’ time. Investors can smell uncommitted management.’
‘Oh, I’m committed to make Ninetyminutes work, all right,’ I said, offended. ‘I’m just not committed to a valuation of a hundred and eighty million quid.’
‘That’s fine, Davo,’ Guy said. ‘Let Bloomfield Weiss worry about the valuation. You and I will worry about the company.’
‘All right,’ said the banker. ‘Our current thinking is that we start off in Amsterdam on the twentieth of March, then Paris on the twenty-first and Frankfurt on the twenty-second. We’ll go on to Edinburgh the following day, and then down to London …’
Ninetyminutes had recovered from its pre-Christmas wobble. Sanjay had taken Owen’s place and, together with Dcomsult, he had retailing up and running again in a matter of days. We shipped a respectable quantity of clothing before Christmas. The millennium came and went without blowing up our computer systems and we hit the New Year running. The German site was on-line by the beginning of March with the French site due to join them by the end of April. We bought a small company based in Helsinki that specialized in Wireless Application Protocol or WAP technology. Eventually this would allow people to check our website from their mobile phones for the latest football scores and news. And the visitor numbers kept on going up and up. Advertisers loved this, and we had no trouble signing them up.
This wasn’t enough for Guy: the more we achieved, the more he wanted. He had plans for even more rapid expansion. More advertising, more marketing, opening up several more European offices, a big ramp-up of the retailing operations. All this would need money. But now that didn’t seem to be a problem.
The IPO got everyone excited. Orchestra Ventures was enthusiastic about the idea: although they wouldn’t be able to sell any of their own shares immediately, they would be able to mark them up to show a huge profit on their books. Bloomfield Weiss liked it because of the fees they could charge everyone. Guy liked it because it would give him as much cash as he could spend.
And I liked it because it would make me a multimillionaire.
It was a very strange feeling. Of course, I had gone into all this with the vague idea of making a lot of money. And, in theory, when Orchestra Ventures had committed their initial investment the value of my stake had increased considerably. But at that stage survival was all I was worried about. In a few weeks my shares would be worth silly money. Of course, it would all be paper profits, but at some time in the future I should get my hands on real cash. What would I do with it? Buy my own Cessna 182? Buy a house on the Corniche? Send my children to Broadhill? It would change my life. I would be a wealthy man, just like Tony Jourdan. Somehow, despite my ambition, I couldn’t imagine that.
I realized that the money had little meaning for me in what it could buy. But it would mean a lot to me to know that I had made it.
Not just me. There was a smile on everyone’s face. Everyone had some kind of stake in the firm, everyone was going to make money. There was a huge amount of work to be
done and no time to celebrate, but the place hummed with suppressed excitement. People put in sixteen-hour days and never seemed to get tired.
To my relief, there was no sign of Owen.
The IPO required a massive amount of preparation, especially on the accounting systems and the legal documentation. There was a prospectus to be written and checked and rechecked. Much of this work fell on me. Mel was a great help, and we spent long evenings together going over obscure points.
My father called, proposing lunch at Sweetings. I had blown him off the last two times he had suggested it, so this time I agreed. Besides, I had good news for him.
They had heard of dot-com fever in deepest Northamptonshire. Even the
Daily Telegraph
was reporting it excitedly. So my father could hardly wait to ask me how Ninetyminutes was doing.
‘It looks like we’re going to float at the end of the month,’ I said.
‘No! You haven’t been going a year yet.’
‘I know. Absurd, isn’t it?’
‘I didn’t even realize you were making profits.’
‘We’re not.’
My father shook his head. ‘The markets have gone mad,’ he said as he tucked into his dressed crab. But he couldn’t keep the smile off his face.
‘They have. But I’m not complaining.’
‘So, um, how much …?’
‘How much will your stake be worth?’
‘Er, well, yes. I was wondering that, actually.’
‘If the shares come out at anything like the level the bankers suggest, about nine hundred thousand pounds.’
My father choked on his crab. He began to cough, went bright red, and took a desperate swig from his half-pint
tankard of Guinness. Eventually he recovered. ‘Did I hear you right?’
‘I think you did.’
A broad grin spread across his face. ‘Well done, David. Well done.’
I couldn’t help smiling back myself. I was proud to have repaid his faith in me so handsomely. I knew what really delighted him wasn’t just the money, but the fact that it was his son who had made it for him. What I hadn’t told him was that my own stake would be worth just under ten million pounds.
‘Don’t count the cash until you’ve sold your shares,’ I cautioned. ‘And certainly don’t spend any of it.’
‘Of course not,’ said my father. And then, ‘Well, well, well. I think the time has come to come clean to your mother.’
‘Haven’t you told her yet?’
‘No,’ said my father, looking a little embarrassed. ‘She might not have approved. But she’ll have to, now, won’t she?’
‘I suppose she will.’
I returned to the office to find it in full panic. I could tell it was a technology-related panic, because everyone was standing around Sanjay’s desk looking anxious, while he was frantically tapping into his computer and trying to communicate with his staff through the bodies around him.
‘What’s up?’ I asked Ingrid.
‘Goaldigger has been attacked by a virus.’
The goaldigger.com website was one of our biggest competitors. It had been active a year longer than us and had more visitors, but we were catching them up quickly.
‘What kind of virus?’
‘Apparently it’s been spitting out e-mails to all Goaldigger’s registered users. Look.’
She handed me an e-mail. It was addressed to Gaz, who had presumably been keeping tabs on the opposition.
Virus Alert
Please be aware that a virus has been detected in the goaldigger.com system. This virus may be able to access the computers of Goaldigger registered users and might download private information, or even corrupt customers’ hard disks. Customers are advised not to log in to the Goaldigger website or open e-mails from Goaldigger. We apologize to those customers who have lost significant personal data as a result of this virus.
The Goaldigger team
‘This sounds strange,’ I said.
‘It is. It’s a hoax.’
‘You mean there’s no virus?’
‘There is a virus. But a simpler one. It just sends this e-mail to all Goaldigger’s customers scaring them off the site. It’ll take Goaldigger weeks to repair the damage to their reputation, if ever.’
‘What a shame,’ I said with irony. The hard truth was that bad news for Goaldigger was good news for Ninetyminutes.
Ingrid looked at me sternly. ‘If someone’s done this to Goaldigger, they might do it to us next. Guy wants to be sure that we’re not vulnerable.’
‘We’ve got firewalls and anti-virus software and stuff, haven’t we?’
‘Yeah, but presumably they had all that too.’
Sanjay was pretty sure that we had protection against a similar attack, but he monitored our system constantly over
the next few days to make sure. Goaldigger did try to get the message out to its customers that the whole thing was just a hoax, but there was no doubt that the episode did them damage. No one found the perpetrator.
Guy, Ingrid and I decided to take an evening off to attend the March First Tuesday event. They were keen to have us. In the internet world we were already billed as a success story before we had even made our first profit. The event was held in the auditorium of a theatre, specially cleared for the occasion. There were queues to get in and pandemonium once we got there. I felt very different than I had last time: much more secure in who we were and what we were doing. As last time, there were hundreds of eager entrepreneurs with ideas. But even more of these ideas were half-baked. In the case of some of them, no one had even turned on the oven. There was also a new kind of venture capitalist circling the room: the ‘incubators’. These were young men or women who had raised money to invest in internet companies at the earliest stage: the equivalent of the Wapping phase in Ninetyminutes’ history. They were scarcely less flimsy than the companies in which they were investing, but somehow they had attracted cash and they were throwing it about. They made the thirty-year-old Henry Broughton-Jones look like a dinosaur.
Everyone had a story about one success or another, but the big story on everyone’s lips was lastminute.com, run by the woman I had met at my first First Tuesday. This was a website which provided tickets at the last minute for anything ranging from air travel to theatres to sports events. They were in the middle of an IPO, and the investing public were fighting for shares. The flotation price had just been raised again, valuing the company at nearly five hundred million pounds. Everyone in that room wanted to be as successful
as lastminute and most of them thought they could be. Even, I’m ashamed to say, me.
After a couple of hours of frantic schmoozing, the three of us met up.
‘What a zoo!’ Ingrid said.
‘Can you believe these people?’ said Guy.
‘That’s where we were nine months ago,’ I said. ‘I didn’t believe it would last then. But it has. It’s grown. Lastminute is worth five hundred million. We’ll be worth a hundred and eighty. It really is a new economy after all.’
‘I told you, didn’t I, Davo?’ Guy said. ‘You should have had faith in me.’
‘I did have faith in you!’
‘Yes, I suppose you did.’ Guy smiled at me. Then he looked out over the throng. ‘I wish Dad could have seen this.’
‘He would have been proud of you,’ I said. Actually, I thought it more likely he would have been envious, but I didn’t want to mention that. Nor did I want to ask any more questions about his death. I had asked enough questions and found out as much as I was ever going to on that subject. Although I still didn’t know what had happened to Tony, I was convinced of Guy’s innocence; Owen was gone and I had told myself to be satisfied with that. Besides, if Guy could feel better about his father, that was a good thing.
We left the throng and went our separate ways. I walked down a side-street looking for a taxi. Guy and Ingrid went the other way. I waited at a corner, and nothing came, so I doubled back, trying to find a better spot for a cab.