Starting a successful venture requires a combination of vision and skill, as well as good timing. Sometimes it takes a lot of the former to overcome a lack of the latter. Just ask You Mon Tsang, the founder of Biz360, a San Mateo (Calif.) software company that lets companies automatically track and analyze their media coverage.
In 1995, Tsang and grad school pal Dan Gartung co-founded Milktruck, a company whose software automatically went online during off hours and downloaded pre-selected content for later viewing. A year later, Milktruck was purchased by a bigger company that sold packaged software through retailers. Tsang and Gartung stayed on as employees. Soon PointCast, a well-funded rival, began to offer a similar service for free. No matter how capable its software, Milktruck's business model was suddenly obsolete. Tsang and Gartung were out of luck.
When Tsang and Gartung started Biz360 in 1999, they did not want to be blindsided again. Tsang set stringent ground rules for the new company. Biz360 would zero in on customers with a clear need -- in this case, the vice-president for marketing or communications. The software had to demonstrate a fast return. And to keep from burning too much cash, the company would hire no more than one employee per client.
But by February, 2000, when the prototype was ready, high-tech marketing budgets were evaporating. Yet Tsang managed to raise money three times, for a total of $20 million, in terrible conditions: the aftermath of the September, 2000, nasdaq crash; September, 2001; and during the U.S. invasion of Iraq. In each case, Biz360 had reassuring results to show -- a prototype, new customers, and solid revenue growth, respectively. Today, Biz360 has 55 employees and 70 customers, including Bank of America and Oracle. Thanks, no doubt, to Tsang's market intelligence. By Amy Cortese