A COLUMN IN YESTERDAY'S BUSINESS SECTION INCORRECTLY IDENTIFIED THE BUYER OF ANDREW STERN'S COMPANY, LOGEX. IT WAS APPNET SYSTEMS INC. OF BETHESDA. (PUBLISHED 07/02/99)
What do you do when you're 26 and the technology company you founded has just sold for $6 million?
If you're the very thrilled Ben Lilienthal, you take a week-long surfing trip to Baja.
"It's like, hey, chill out for a while, back to what's important, hanging out with friends," says Lilienthal, just back from his time on the waves.
He may talk like a Gen X slacker, but Lilienthal is one of a growing number of local technology CEOs under 30 who create serious businesses and then sell them for major profits.
In recent months, Andrew Stern sold his company, Logex, to USinternetworking of Annapolis Junction; Jon Hallet sold his NMP to AppNet Systems Inc. of Bethesda and Frank Borges LLosa sold his creation NetFloppy to Xoom.com of San Francisco.
In this latest example, Lilienthal sold his 12-person company, Nascent Technologies Inc. of Herndon, to Internet investment firm CMGI Inc. of Andover, Mass., in an all-stock transaction. Nascent is a Web based e-mail service that helps people send and receive mail from remote locations.
"It's a wild time," says Lilienthal. "Three years of work translates into six million dollars."
Okay, it's not a big as CMGI's other recent purchase, Compaq Computer Corp.'s Alta Vista, for $2.3 billion. But it changed Lilienthal's life.
So how much did Lilienthal make personally? He won't say. But at the same time as he calls his haul "modest," he notes he's thought nothing of bankrolling the trip to Baja and impulse jaunts up to New York.
The negotiations to sell the company were some of the toughest work he's done, he says. They took a painful 100 days. He heard a thousand no's for every yes. "You've got to either be dumb or stubborn or both," he says, describing the process of starting and selling a company. Part of the pressure is from the skeptics, the "2 1/2 years of people saying 'you're idea is stupid.' "
Lilienthal says that while he plans to stay on with CMGI, operating Nascent as an independent subsidiary, it's possible he'll start another company someday. But, he explains, "I'm an adrenaline junkie as opposed to a serial entrepreneur."
America Online Inc. is on a freebie spree, sort of.
It announced yesterday that it's formed a deal with eMachines Inc. of Irvine, Calif., by which people who buy low-priced eMachines PCs, including a $399 model, will get a $400 rebate if they sign a contract for three years of AOL's service CompuServe. For $21.95 a month, they get unlimited access.
That amounts in effect to giving the machine away in return for a service contract. But wait a minute: There's no monitor with the computer. eMachines will sell you one for $100 to $225, depending on size.
Still, it's a major step in the direction of free hardware by the world's largest online company, which wants to make customers of people who can't afford PCs.
"Price matters," said AOL spokesperson Wendy Goldberg.
She said this particular deal will last only about a month, but that AOL will make similar offers with other PC makers. AOL is offering the CompuServe service with the package, not AOL, because it wants people to think of CompuServe as the low-cost alternative.
In Europe, AOL is also thinking free, on the service side. AOL Europe, a joint venture with Bertelsmann AG of Germany, is poised to offer free Internet service called Netscape Online in Britain starting in August, according to press reports. AOL has been overtaken as Britain's number one ISP by the fee-less Freeserve of Dixons Group Plc.
It was quite a controversy two years ago when accounting firm Ernst & Young was persuaded to eliminate its "women" category in its annual Greater Washington Entrepreneur of the Year awards. Several area executives didn't like the fact that women nominees always seemed to end up in that one category and no other.
This year, however, it seems the decision has backfired.
At the June 24 awards, only one woman was nominated, and she was listed as a co-nominee with her colleague.
Kathy Clark, chief executive of Landmark Systems of Vienna and a previous winner of the award, was among the voices calling for the elimination of the women-only category.
"I lobbied to get rid of the category," said Clark. "It's not E&Y's fault." The important thing, she said, is that women excel in business and make make sure they get nominated.
Artesia Technologies has opened shop in Rockville. The company was formed by a management-led buyout of a business unit of the Thomson Corp. of Toronto, led by Artesia's new chief executive, Chris Veator.
Financial backing came from $25 million from Warburg Pincus Ventures. Artesia, which helps companies and governments figure out how to make use of their digital information and assets, expects to employ 100 people in Rockville by the end of the year.
Send tips and tales of the digital capital's local people, deals and events to Shannon Henry at firstname.lastname@example.org.
CAPTION: Nascent CEO Ben Lilienthal surfs, and then he surfs: "It's like, hey, chill out for a while, back to what's important, hanging out with friends."