Did You Hear The One About The Two Businessmen On A Plane?
News Nov 27, 2014
In the late 1990s you couldn’t move without meeting someone who had just raised money to create a start up. The dot-com bubble was growing exponentially, month on month, unwittingly headed closer and closer to its demise. Many of these companies were constructed on shaky business models, or had leaders who lacked operational experience. But all had managed to raise a LOT of money. Unfortunately, many of these “next best things” spent their new found capital lavishly; expensive advertising, ergonomic cubicles in high-rent facilities, and the like.
Stories of how the companies were founded are mostly tinged with romance too; broke college students inspired by a pattern in their bowl of Ramen Noodles, out-of-work software engineers tinkering in their garage, or, as in the case of EquipNet, which is celebrating its 15th anniversary this year, a chance meeting between two people on an aeroplane.
In the early spring of 1999 a 737 took off from O’Hare in Chicago headed to Logan in Boston. One of the passengers on that plane was an industrial equipment dealer flying home after attending a pharmaceutical machinery auction. By chance, or fate, the equipment dealer was seated next to a business consultant who specialized in website start-ups.
Introductions were made and the topic of conversation turned to their professions. The consultant explained that he and his business partner were, what he called, “venture catalysts.” They had access to angel investors as well as venture capitalists and provided business plans and start-up management to companies with great ideas. But the thing that intrigued the equipment dealer the most was the fact that the consultant’s latest venture was with a company that had created an online auction platform.
The dealer confessed that he had been thinking about the best way to sell industrial equipment over the web and knew that if done correctly, it would revolutionize the way that companies buy, sell, and manage their surplus capital assets.
Contact information was exchanged and a meeting was set up, this time in the equipment dealer’s office. That meeting led to the development of a business plan, and on May 12, 1999 EquipNet was founded.
By July, supported by angel investors, the company hired its first two employees, a web developer and a marketing professional. This team of two developed an online equipment auction site in less than a month and on August 12, 1999 the site launched with inventory from the equipment dealer’s existing stock. At first, each online auction ran for two-weeks. Marketing included outbound calls, some rudimentary emails, and fax blasts. EquipNet’s first sales closed on September 12, 1999. In the next three months, four other employees were hired in sales and IT.