In 1999, David Zinberg took jewelry from a handful of his pawnshops and began auctioning them online. Two years later, despite the dot-com crash, Bidz.com Inc. brought in $1 million. This year, he expects revenues of $170 million.
Zinberg said his business is booming because of the sheer amount of jewelry found on the site about 1 million pieces and the friendly shopping experience the site provides. Unlike many other auction sites, Bidz allows bidders to win up to three items, see the kind of deals they can get, before it asks them to register and supply credit card numbers.
“It’s like if you walked into a store and the store owner asked for your credit card before you got to shop around. People would turn around and walk out,” Zinberg said.
Plus, since the items are auctioned off at about 20 percent below the market price, users can resell the jewelry online or at an offline store for profit.
The Culver City-based company buys huge volumes of closeout merchandise at low prices and resells them. “We buy $200 million worth of merchandise, compared to a million different vendors on Ebay spending about $1,000 each. We get better deals because of the volume,” Zinberg said.
Even though Bidz.com, a company of 200 employees, has more than five million users and has enjoyed revenue spikes of up to 40 percent every year, the Web site doesn’t turn up in search engines Google or Yahoo.
That’s because Bidz.com is a “live action” site and its pages are not stationary. The site has no traces of cookies, the parcels of text sent by a server to a Web browser then back again each time it accesses that server. They are used for authenticating and tracking information about Internet users.
So in a couple months, the company plans to launch another site called Buyz.com, which will allow users to design their own jewelry, search for diamonds and shop in a virtual jewelry shop. The site will have stationary pages that could get enough hits for the company to get representation on major search engines and advertise on major shopping sites such as Amazon.com.
Leading Edge
L.A.-based Leads360 LLC makes it easy for advertisers who rely on lead generation businesses, such as Low.com or CarsDirect.com, used by mortgage companies and dealers for leads.
The Web-based software automatically routes the potential leads to the computer screens of sales associates. Once the information is posted into the Lead 360 system by lead generation companies, it pops up on the computer screens of the advertisers’ sales associates.
“Up until now, there was no accountability, no metric for how leads are pursued,” said Avi Fischer, director of marketing at Leads360. “Our software helps manage those leads. Some clients of our consumers get phone calls as soon as they hit ‘enter’ on a leads generation site. It’s that automatic.”
The three-year-old business recently received $3.25 million in venture funding from Rustic Canyon Partners. The company will use the money to expand into sectors outside the mortgage industry, including education, financial services and debt consolidation.
The company has 40 employees and services 500 clients.
Web-Based Platform
Napster Inc. is planning to attract more customers by moving to a Web-based platform that will allow users to play their music from any computer without requiring additional software.
The move by the West Hollywood-based music subscription service is intended to attract more paying subscribers by making its platform more flexible and compatible with any Internet-enabled device, Napster said in a statement.
Subscribers can now access their music only after downloading the Napster software application which is similar to a model used by Apple Inc.’s iTunes store.
Boyd to Buzznet
Scott Boyd has been hired as the general manager of music at Buzznet Inc., a quickly growing online social network for entertainment media.
Boyd will be responsible for all aspects of music content, production and programming on Buzznet.com, which boasts 8 million users, compared to 2 million six months ago.
Boyd was previously the managing director of AOL Music.
True to Reunion
Cornell McGee has been appointed chief marketing officer of Reunion.com Inc., a social networking Web site that helps reunite family members and friends.
McGee joins the firm from dating site True.com, where he was also chief marketing officer. He also served as senior business manager at Match.com.
Earlier this year, Reunion.com raised $25 million in venture funding to expand its marketing activities.
Staff reporter Booyeon Lee can be reached at (323) 549-5225, ext. 230, or at [email protected].
