KATIE BURKE: It wasn't a part of the curriculum at the time. There was
a class about new product development and many new Internet business plans
were coming out of that class. I had the opportunity to do a project in
the class. The class wasn't specifically about the Internet, but about
new products. I had the opportunity to work with a company in Texas called
Interval Systems, helping them with their marketing plan and product plans.
Also on the side, not related to a class at all, a fellow classmate,
Gary Mueller, was writing a business plan for a company called Internet
Securities. The company took equity research reports from local developing
markets in Eastern Europe and Asia, had them translated to English and
sold to Wall Street. He used the Internet as a delivery mechanism to do
that. I got the experience through those two in particular. I also had
the opportunity, through a friend of a friend, to meet Jerry Yang for
a New Years weekend just before he was getting funding so I got exposure
to the consumer side of the Internet as well. It was a collection of different
experiences, none directly related to the curriculum, but just opportunistically
as things came along. All stars started to point towards the Internet
as interesting opportunities.
KAREN LAKE: Then from Net Dynamics you said that you went to America
Online. What was your involvement there and what was their size at that
time and what part did you play?
KATIE BURKE: I worked with them more as a consultant than as a direct
employee. I worked on some business plans for Digital Cities, but also
worked on more strategic elements of the business, like advertising and
promotions. That was interesting because it was six to eight week projects
on different parts of the business. I got lots of exposure to lots of
different parts of it. That helped me zone in on the product piece, something
that I got excited about for me personally. That was interesting too because
it was a more consumer oriented business.
Net Dynamics had been an enterprise applications business. While I enjoyed
the experience of being in a start up, being in a dynamic environment
in a high tech industry, I did realize that I wanted to work on things
that were products that I use and that my mother would use and that my
friends would use. I got much more excited about that. It was a great
opportunity for me to understand that what turned me on and what got me
excited about the Internet was more than just the Internet per se as a
category and more about products and services that related to myself and
to people like myself. There were about 2,000 people at the time. That
was one of things that drove me to come back out west looking for a smaller
start up opportunity in the consumer market.
KAREN LAKE: Talk to me about some of things that you learned at AOL.
It sounds like you got a great deal of exposure. What were some of the
lessons you learned and applied to your next venture?
KATIE BURKE: I think really understanding, making sure that you do everything
you can to understand what customers want and need. America Online has
this incredible magic with consumers. The service continues to grow like
gangbusters and people get addicted to it. That's because for users who
are trying to get on the Internet, it's really easy. It takes care of
everything. You slide a disc in, it connects you to the Internet and then
you get thrown into this environment that's very intuitive. You can find
what you want and what you need. They continually refine that. They pay
attention to what people use on AOL and what they think and what they
want more of and what they want less of. At the time I was there, thousands
of e-mails got sent to Steve Case with suggestions. I'm sure it's many
more now. There are people at AOL who sit and read that e-mail for a living.
They make sure that that feedback gets to the people who are working on
the products and the pieces of the puzzle. Understanding your customers'
psyches and what turns them on and what turns them off and continuing
to deliver what they want is really, really important. I think that's
been one of the things that's fueled their success. Their users want everything
easy, seamless, easy to find and they don't want to be bothered with having
to have to go into the control panel and click on Network to change their
IP address. That's just not what their consumers want to touch. They understand
that and they make those pieces of the Internet work in the background.
KAREN LAKE: What are some of the secrets to encouraging that feedback?
How is AOL encouraging that feedback and how can that apply to a small
business that's looking to find out what their customers want? KATIE BURKE:
Making the mechanism to contact you very forward and obvious to the user
is important. AOL has an entire area where you can give feedback. They
talk about getting your suggestions and they make their communication
channel with the customer very forward in terms of their offering. They
communicate to users and tell users to contact them. Steve Case sends
out his monthly newsletter and encourages people to contact them. He lets
them know what's new. That reminds them that there is a communications
channel here and yes, they send an e-mail to me. Maybe I should respond
to that and tell them what I think about it. That proactive channel of
communications helps remind people that there are real people behind the
scenes who are paying attention to them.
KAREN LAKE: Katie, can you take us back to the creation of Four11 and
RocketMail? How has that changed your life in general and your view of
the Internet marketplace?
KATIE BURKE: I'd returned after AOL to the West Coast looking for a consumer
oriented Internet start up experience. I had the opportunity to interview
with Four11, which at the time had been around for about a year. It was
founded by the gentleman who's now my partner here, Larry Drebas. I met
with the management team there. They had a very exciting business going
on. They were a top ten site on the Internet. People were using their
service to find old friends that they had lost track of, to find Christmas
card mailing addresses, for all sorts of things. The company was at a
crossroads.
They had just signed a deal to take their second round of funding. While
the white pages were an incredible traffic generator, they weren't necessarily
generating the revenues to make the company believe that this was going
to be their long-term business. They decided they were going to diversify,
which for a company that was fifteen people, was a very difficult decision.
They were in a very competitive Internet environment. There were five
other companies doing Internet white pages at the time. To say that you're
going to take some of your resources and apply them to a brand new business
is a big risk. But they felt it was important and it was going to be a
stepping stone.
I joined the company with the intention of helping them to decide what
product was going to be the next diversification. We decided to do web-based
e-mail and built RocketMail. At the time, Hotmail was in the market. Hotmail
was also a web-based e-mail service. It was in the market ahead of us,
but we saw it and started to think about what this web-based e-mail thing
meant for customers. It was a very powerful idea that people could get
to their e-mail from anywhere. It provided a different value proposition
than reading your news or reading your stock quotes. We built and launched
RocketMail, which grew from zero to one million users in about six months,
which is incredible growth. RocketMail was a very successful service that
attracted different partnership opportunities for us with all sorts of
big players on the Internet.
It was in the course of talking about a partnership opportunity with
Yahoo! that both companies decided that it made more strategic sense for
us to be acquired by them than to build a co-branded service for them.
So Yahoo! acquired Four11 in October of 1997. It was one of the first
big Internet acquisitions in the consumer space, which has kicked off
a round of hundreds of them. Thirty people joined Yahoo! It was a terrific
experience of very similar cultures, which was important to us. They had
a very similar consumer mindset. We became Yahoo! Mail, but also the team
of us at Four11 got together with the team of folks at Yahoo! and started
building new products. We built Yahoo! Calendar and Yahoo! Address Book
and Yahoo! Small Business. We took this idea of being able to get e-mail
from anywhere and started thinking what about getting to your calendaring
information from anywhere. Before you knew it, we were riding on this
wave that a lot of people were playing in. We had just had the unique
opportunity to be a little bit ahead of it with RocketMail. [cont..]
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