Dial-Up Pioneer Sees Net Gains in Floral Service

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These days, Mark Goldston is probably best known as the king of dial-up Internet.

But don’t pigeonhole Goldston as a tech guy.

The 54-year-old chief executive of Woodland Hills Internet company United Online Inc. is also an accomplished author, runs the world’s largest flower business and believe it or not is the co-creator of inflatable-pump sneakers.

Goldston credits his success largely to his knack for recognizing good ideas, but those that have worked with him say there is more to it.

Robert Chandler, chief executive and founder of advertising agency General Levitation, said Goldston has a keen understanding of both the nitty-gritty of running a business and how to appeal to consumers.

“He’s a great numbers guy, but he’s also got a good vision for promotion and marketing,” said Chandler, who has worked on United Online’s ad campaigns for the past decade. “Usually numerates aren’t good marketers, but he seems to have instincts on both sides.”

Those instincts have been put to the test since Goldston took over NetZero, the precursor to United Online, in 1999. The company, which provided free dial-up Internet access, was a small player in an industry dominated by America Online.

At the time, NetZero had just two dozen employees and “basically no revenue,” Goldston recalled. In 2001, he bought one of NetZero’s main competitors, Juno, in a deal the business press derided as an effort to take two skunks and breed a mink, but which turned out to be a winner.

Then, a few years ago, with dial-up losing more and more ground to broadband, Goldston decided time was ripe to diversify “in a major way.” The company acquired Classmates Online, which is credited as the first online social network. Spotting an opportunity to “cross-pollinate” with Classmates’ 40 million members, the company acquired floral company FTD Group Inc. in an $800 million deal in late 2008.

“We thought the ability for us to use our branding skills to help reposition and polish the image of this great American iconic brand (were) significant,” Goldston said.

Now, half of the company’s nearly $700 million in annual revenue comes from its FTD segment. Classmates, meanwhile, constitutes about 28 percent, while the original dial-up Internet segment is now less than one-quarter.

The company has not only improved its bottom line, but it has also grown its ranks to more than 2,000. Goldston said one of the keys to managing a large work force has been to make integrity and respect a fundamental part of his leadership style.

Being a chief executive is more or less what Goldston had wanted to do since he was kid that is, if playing professional baseball didn’t work out.

“I either thought I was going to be a shortstop for the Chicago Cubs or I thought I was going to run a big company,” he said.

Goldston said he takes after his father, who was chief executive of a chain of discount retail stores. “I had a role model for what it took to be a CEO and how to balance family with business.”

After getting his MBA from Northwestern University, Goldston took on a variety of roles. He worked at a private equity firm, for skincare company Revlon Inc., and held high-level positions at footwear companies Reebok and L.A. Gear. During his time at the shoe companies, Goldston helped create the popular inflatable-pump sneakers, as well as light-up shoes.

At 31, Goldston was hired as president of Faberge USA Inc., reportedly becoming the youngest person to head a Fortune 500 company. He also has found time to author a book on business strategy called “The Turnaround Prescription.”

“I always try to find opportunities where I can put my creative and innovation skills to work,” he said. “Those skill sets are very transferable from one industry to another. The old adage that people have to stick with one industry for their entire career is something I’ve never believed in.”

LARGE PUBLIC COMPANY


MARK GOLDSTON

, 54

United Online Inc.


YEARS ON THE JOB: 10


QUOTE: “You’re only as good as the people around you. You can be fortunate on your own and succeed for a while, but to succeed over the long term, you really have to be surrounded by talented people.”

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