Pär-Jörgen´s War Story: Long, lasting relationships
It was a beautifully sunny morning in March, one of those mornings that make you wonder about, you know...the big picture, and the meaning of it all. I had gathered a number of executives from our portfolio companies for a conference-cum-downhill skiing event in the snow glittering slopes of Åre in northern Sweden.
As we set out for our first run, I immediately noticed how Kristofer Arwin without fear, and with 100% control threw himself down the moguls at a neck-breaking speed. Don't ask me how, but I really knew instantly that he had the right entrepreneurial qualities. More than a decade later, I can conclude that I read him correctly.
In 1998, he presented Pricerunner, an internet based price comparison concept, to us. Not a single line of code had been written but we provided him with a desk, a computer and a telephone and so he got started. During the following months, he gathered his founding team and had the site up and running in time for Christmas 1999.
The number of users grew rapidly and soon made Pricerunner into one of the top price comparison web services. The path to success was, however, as bumpy as the mogul slopes that Kristofer excelled in. The dot-com collapse, left the company with limited funding resources, co-investors that had lost confidence (and most of their money) and a gnarling suspicion that the business model of Pricerunner didn´t work.
Having been the Chairman of Pricerunner since its inception, I could sense that this was the real moment of truth. In a pivotal board meeting, there was a deep dispute running through the Board on the viability of the business. The choice of leaving the internet business and instead go for a market research model was up for a heated discussion.
I asked for a half-hour break to prepare Kristofer and the Board for a more stringent and fact-based discussion. There were many hot heads that needed cooling.
The half-hour actually became two hours but resulted in one very simple but fact-based argument:
- If we would continue on our current track with our current rate of sales development, we would reach breakeven in 4 months and become super profitable within 12 months.
The rest of the story most e-commerce savvy people know. Pricerunner became one of the leading shopping search sites with operations in many parts of the world, nowadays a part of Nasdaq listed Valueclick Inc. The contemplated market research arm actually became a very successful sales and PR tool for the company, but not a business unit in its own right.
We were of course extremely happy to make a great return on our investment in Pricerunner. However, what made us even more elated was when Kristofer and his founding team returned to us, asking us to fund their most recent start-up Testfreaks.com, a product review site. The team is even more focused this time in building a global Internet category leader. With millions of unique users and rapidly rising revenues in less than a year after launch, Testfreaks can already claim the title as the World´s Largest Product Review Site. Needless to say, we are proud to be a part of yet another success story with a returning world-class entrepreneur. And this time we are happy to know that our work together will be top class all the way - during inevitable uphill struggles as well as in periods of smooth downhill gliding.
