Women's Connection Online Reaches for Next Level
Women's Connection Online Reaches for Next Level
By Bob Starzynski
Women's Connection Online is banking its future on an effort next month to raise $2 million in venture capital.
The money will allow the 4-year-old company to double its staff to 12 and upgrade other resources and technology, said Susan DeFife, president and founder of the online content and networking site.
No investors have been lined up yet for the next round of capital, which DeFife hopes to wrap up in March.
Susan DeFife, president and founder of Women's Connection Online
The McLean, Va.-based company landed its first round of venture capital last May with $650,000. Most of that money came from Mid Atlantic Venture Fund in Bethlehem, Pa.
The next round "is all the money we will need to become profitable," DeFife said. Last year, the company reported $500,000 in losses on revenue of $100,000. This year, WCO officials expect revenue to jump more than 2,000 percent to $2.2 million.
Few companies in DeFife's market have found the key to making money. But WCO hopes to be an exception. That's because WCO is aimed at the largest growth sector of the Internet - women.
"Fifty million women will come online in the next 30 months," said MacDara MacColl, vice president of member services and marketing at iVillage: The Women's Network. "This is the biggest mass movement in media history." New York-based iVillage, with 155 employees, is the largest site for women on the Internet, generating 56 million page views a month.
Although WCO generates only 500,000 page views a month, the company has a well-honed niche: business information for women who are business owners or other types of professionals. DeFife said her company's content is "more like Forbes or Inc. than Cosmopolitan or Redbook."
IVillage, on the other hand, focuses on issues such as parenting and health. For instance, a new mother may go to the site and raise a "chatroom" question about the cough of her young child and get responses from other parents. Popularity of the site has been bolstered through an advertising blitz last month that included a full-page advertisement in the Wall Street Journal.
Still, WCO's market has tremendous growth potential. Statistics by Nielsen Media Research, New York, state that women now account for 42 percent of Internet usage, up from 10 percent four years ago. And, a study released last month by Forrester Research in Boston predicts that salaried women will continue to be the fastest growing Internet sector for the next two years, with a five-year growth rate of 450 percent from 1996 to 2000.
"Computers are becoming more intuitive," said Julie Holdren, chief executive officer of the Olympus Group, a database software company in Alexandria, Va. "You don't need an engineering degree to navigate a World Wide Web site." Holdren said she goes to the WCO Web site at least once a month to find out what is new in the small business financing market.
WCO also has several co-branding deals in the works that could help attract more attention to the site. These deals are projects jointly developed with other companies that give new services to site users.
According to DeFife, WCO was to unveil an investment area in mid-February that will be co-branded with National Discount Brokers and the Motley Fool, an online investment success sprung from Dulles, Va.-based America Online Inc.
The site's redesigned business center will open at the end of the month. That project spawns from partnerships with Armonk, N.Y.-based IBM Corp. and Entrepreneur magazine. A co-branded business travel area, for which DeFife would not give details, will open on the site next month.
These moves follow the Feb. 5 launch of a career center on the WCO site. The job-hunting tool is co-branded with CareerBuilder Inc. in Reston, Va. By jointly hosting the career center, WCO can lure new users to its site with expanded services, while CareerBuilder expands its audience. Both companies split the revenue generated through the service.
"Co-branding is a vital part of our revenue stream," DeFife said. Thirty percent of WCO's revenue comes from co-branding relationships, 20 percent from electronic commerce offerings on the site, and the remaining 50 percent from advertising.
Patty Abramson, founder of the Women's Growth Capital Fund
"They are using every possible way of generating traffic and revenue," said Patty Abramson, founder of the Women's Growth Capital Fund in Washington. "It's incredibly innovative."
DeFife readily admits that her company has not increased traffic to its site through advertising. Traffic has increased 1,500 percent in the past nine months through word of mouth and agreements with associations.
Since last May, WCO has teamed with 30 women's business and professional associations. The associations get a presence on the Web. In return, they promote WCO to their members and include the Web address (www.womenconnect.com) in their literature.
DeFife said she would rather work together with businesses like iVillage (www.ivillage.com) than go head to head with them. Although those two companies do not currently link their Web sites together, WCO has links with many other women's sites.
One such site is the Small Business Administration's Online Women's Business Center (www.onlinewbc.org), launched last month. Similar to WCO, the SBA site offers free information on networking, industry news and market research. Rather than feel threatened by the competitor, WCO put a link on its site to the SBA site.