pomoco aftermath

18 May 2002
Pomoco Aftermath

Over the last couple of months, I've been curious enough to research the more recent fortunes of the original employees of PostModern Computing Technologies, Inc, which was a software company I helped start in Palo Alto, California, in 1991. PostModern was acquired by Visigenic Software less than a year after I left the company, in 1995, and Visigenic was acquired by Borland after that.

Including myself (Thane Plambeck), the original employees of PostModern were (in the order hired):

Jens Christensen
Thane Plambeck
Prasad Mokkapati
Suresh Challa
Neguine Navab

Almost all of the information below is based on what I've found on the web, not from these people themselves.

Jens Christensen and Neguine Navab are married. They apparently started a company called WebSwap sometime in the late 1990s (probably 1999). The service itself seems to have launched in the early part of 2000.

Here's a description of this business that I found in an article on the web, dated 17 January 2001, by Dave Baranowski:

WebSwap

It's not easy for an auction or retail Web site to find a model to distinguish itself these days.

Dynamic pricing? Fixed prices? Bartering? Sure. But how about all of the above? And how about letting the users decide how they'd like to transact? Hmmmm...

No, it's not easy for sites, especially niche venues, to stand out nowadays. It's crowded and competitive out there, so if you're a barter site such as WebSwap, it helps to have a way to get noticed and appeal to buyers and sellers.

Freedom of Choice

WebSwap faces competition from other barter sites such as MrSwap.com and Switchouse, among others. Moreover, the practice of bartering used items such as computers and sporting equipment online isn't exactly new--folks who use newsgroups and bulletin boards having been doing it for years.

So how is WebSwap attempting to differentiate itself? The site lets its users choose whether they'd like to flat-out buy or offer to barter something they already own. In other words, they decide on how they want to transact.

And it's probably for the best.

Consider that it's not every day that you'll run across someone with spare Nissan car parts who wants to swap them for a men's wristwatch. And consider that even if you find someone willing to trade the latest Frank Sinatra biography for a pair of used hockey skates, how hard is it to make the deal come out even-steven?

To begin the process at WebSwap, swappers register and list the items they "have" and the items they "want" (free of charge) in multiple categories. The site's listings so far consist mostly of CDs, games, and movies that people have outgrown.

From there, WebSwap's patent-pending technology identifies matches between multiple individuals. For the person who wishes to swap the pair of hockey skates for that Sinatra book, multiple individuals means he or she actually has a 1,000 percent greater chance of success, according to WebSwap.

The WebSwap interface then walks swappers through the steps of making an offer, negotiating the terms, and closing the deal. The site provides users the flexibility to buy and sell items outright as well as use money as a "swap equalizer."

For buyers who don't have the patience to wait or haggle, WebSwap allows users to "buy it now"; that is, buyers can set up a deal for an item, and immediately buy when it becomes available. The seller might not need to list it at all.

WebSwap charges sellers a fee of 4 percent to 9 percent of the total amount of a sale. For example, the site reports that on a sale of $15 (including shipping and handling), it would cost the seller $1.20.

As an added service, WebSwap provides an escrow function, in which the site takes over the payment transaction, holding payment in escrow for a two-week period until the buyer has inspected the shipped item. Shipment of an item is confirmed within three days.

WebSwap also offers bulk loading, free image hosting, and a $300 U.S. transaction guarantee backed by Lloyd's of London.

Swap Till You Drop

WebSwap officially launched last February with $13 million in first-round VC funding. The site now claims to have 250,000 registered users and 275,000 unique listings.

At this point, actual swaps make up fewer than 25 percent of WebSwap's transactions. But those people who make up that 25 percent can't say they didn't have other options.

[Sidebar]
Metrics: WebSwap

Site offering dynamic pricing, fixed pricing, and bartering as ways to transact person-to-person business.

275,000 unique listings
250,000 registered users
1.5 million unique visitors
No. 7 Web site for women 25-34 (Media Metrix)

Services: Bulk loading, free image hosting, in-house escrow service, $300 transaction guarantees backed by certain underwriters at Lloyd's of London, 100 percent safe payment processing, and multiple ways to transact

Fees: Transaction fees for sellers run from 4 percent to 9 percent; no charges for buyers

Other Options: If bartering isn't someone's preferred method of striking a deal, WebSwap offers a virtual garage-sale option. With this dynamic-pricing method, prices on new and used merchandise fall hourly while a rock-bottom minimum price is maintained.

That all sounds pretty good. Here's another boosterish article on WebSwap. And here's another one from early 2000 that appears in a publication called Valley Capital Report. Marc Goldburg even told me that he saw an article on Jens and Neguine in People Magazine. I'll have to find it and add it to this web page.

Unfortunately, WebSwap seems to have missed the window for selling this type of consumer-oriented (and presumably highly unprofitable) Internet business. Things must have gotten increasingly unpleasant after the great Internet stock crash began in March 2000.

Eventually (March 2001) WebSwap recast itself as a new company focused on "web services solutions" called Tradia. Here is a fragment of an article announcing the new plan, dated 15 May 2001:

Tradia Inc. introduced its InstantXML software that the company claims can automatically turn Java-based applications into Web-based applications or Web services. Neguine Navab, Tradia’s (www.tradia.com) vice president of engineering, said that the program uses Java APIs to discover methods of a class, identify those methods and then generate a Web services application from those methods without the need to generate any new code.

She added that once a Web service has been exposed to the Web, it would be possible for Visual Basic programmers using .NET to find the service, bring it in and access it from within a VB application using the XML data types now available in .NET, essentially providing a way to use Java components within a Microsoft environment. InstantXML will be in beta testing until June; no prices have been announced.

But that doesn't seem to have solved the problems. By the summer of 2001, Tradia went out of business too.

Here is a report from the online version of the Red Herring magazine, dated 18 July 2001:

Dealflop: Tradia

After three attempts at finding the right business model, Tradia has gone kaput, burning Accel, Sequoia, and angels to the tune of $14 million.

By Julie Landry
July 18, 2001

After three attempts at finding the right business model, Tradia has gone kaput.

Started in 1999 as Webswap.com, a consumer-to-consumer e-commerce and swapping site, Tradia cycled through several of-the-moment attempts to become a viable business before closing its doors on June 25. In the process, it burned through $14 million from Sequoia Capital and Accel Partners, and angels Roger Sippl and Ron Conway.

Webswap.com debuted in February 2000, first allowing consumers to barter for items for free and later charging a sellers' fee, and even trying a "garage sale" model where prices dropped over time.

Hopping on the business-to-business (B2B) and application service provider (ASP) bandwagons in late 2000, Webswap.com relaunched as Tradia to sell hosted infrastructure software for corporate bartering based on its existing technology.

Tradia's Webswap.com subsidiary was shut down in March 2001, about the same time most of its competitors ran out of steam (including Swapit and Swap.com).

In a last-ditch effort, Tradia began marketing itself as a "Web services software company" in April 2001. Its core product was to be InstantXML, a tool that would allow Java and HTML developers to Web-ify existing applications. Again, it faced too many competitors.

What lessons did Tradia's investors take away from the failure? Mark Kvamme, who sat on Tradia's board for Sequoia, and the rest of the investors didn't return calls for comment.

ANOTHER ONE BITES THE DUST

Just a few weeks after Tradia tanked, another Sequoia investment -- a much more prominent one -- also shut its doors. Online grocer Webvan filed for Chapter 11 bankruptcy. Sequoia had invested $53.5 million in the company and reportedly watched the value of its holdings dwindle to just $4.5 million as Webvan shares sank to just 6 cents on the day it declared bankruptcy.

On 17 May 2002, just before putting together this web page, I drove by the former Tradia office location in Palo Alto to see what was there, and took some photos.

Tradia sign, still attached to vacant building
almost one year after the company failed

Tradia office building

Chairs, possibly from PostModern Computing offices ca 1993,
in silent repose in vacant Tradia lobby, 2002

Tradia office floorplan posted on front
door of vacant office building

Since I was already out on the road in Palo Alto with a digital camera, I drove by the old PostModern Computing office locations and took some more photos:

PostModern Computing office location ca. 1992-1993,
1032 Elwell Court, Palo Alto, CA

PostModern Computing office location ca 1994,
1897 Landings Drive, Mountain View, CA
Office location: Upper left (2nd floor)

1987 Landings Drive, Mountain View, CA,
Stairs up to PostModern offices

General Counsel Associates Sign, with blank space
where PostModern Computing placard once was.
1987 Landings Drive, Mountain View, CA

1987 Landings Drive, Mountain View, CA,
Stairs up to PostModern offices (on left at top)

1987 Landings Drive, Mountain View, CA,
Door to PostModern offices