The IPO Report

The Scoop On Scoop Inc.
10/8/97

by

Tom Taulli

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On April 17, 1997, Scoop Inc. [SCPI], a Web-based content company, went public at $4.50 per share. Within a month, the stock soared to $7. However, the stock is now selling for $3, showing the IPO market can be extremely volatile.

But at its current price, Scoop might be a buying opportunity.

On Sept. 5, Scoop announced the hiring of a new CEO, Rand Bleimeister. He was the senior vice president of sales at Virgin Interactive Entertainment, where he grew computer game sales from $10 million to $70 million -- in less than two years. Bleimeister was also the senior VP at Columbia TriStar Home Video.

I had an opportunity to interview him about the direction of Scoop:

: On Sept. 15, Scoop announced a new service called Scoop Direct. What sets it apart?

: Scoop is a current awareness news and information service. With Scoop Direct, we are giving end users the opportunity to access premium quality content via an E-mail service. The end user can personalize up to 25 different topics. Each morning, Scoop will deliver headlines and the first three sentences from 10 relevant articles for each topic.

The daily E-mail is free. In fact, you can search for free the entire Scoop article database in real time. No other service allows this.

Now, suppose you find an article you like. You can then purchase it. In other words, you do not have to subscribe to a magazine or newspaper. You only pay for the information you want.

What makes us different is that we have access to more than 3,000 information sources -- magazines, newspapers, trade journals. True, Yahoo and other content sites offer free information. But the content is mostly news wire stories -- not high-quality content.

If you're a salesperson or a marketing executive, you need to know that latest information about your customers and prospective customers. With Scoop, you can get the latest news and information on thousands of companies nationwide delivered to you each morning. Try finding a wire service that will do that for you.

: How much does the information cost?

: The lowest is 25 cents per story. This is typically for a small article, like a news wire service story. The next price point is $1.25, which is typically a newspaper story. There is content for $2.75, which is for major magazines. Finally, you can purchase trade journal articles for $3.95.

The payment is handled from a secure server. Then again, if you are uncomfortable purchasing online, you can always call us with your credit card information and we'll set you up over the phone.

You can check us out by going to and then registering for our 14-day free trial of Scoop Direct.

: There are many information online information services in the market. One of the biggest is Lexis-Nexis, a billion-dollar giant.

: That's true. However, we have some advantages. First, our service is very intuitive. If you can use Yahoo, you can use Scoop. Lexis-Nexis, on the other hand, is very complicated. You need lots of training to use the service. Second, Lexis-Nexis is very expensive. You pay a monthly subscription, plus a fee for how long you are online. This can add up very quickly.

: Because of these advantages, are you trying to grab market share away from Lexis-Nexis?

: We are a small company. And we need to be careful about where we focus our resources. It is very costly for us to go after large corporations that already have relationships with Lexis-Nexis or Dow Jones News Retrieval. Instead, we are focusing on small- to medium-sized companies.

This has been a neglected market. After all, these companies do not have the cash to purchase a Lexis-Nexis system. Scoop offers these companies a terrific value. And this market is huge. Only 5 percent of U.S. companies use an information service. So we're going after the 95 percent that should.

Because of the Internet, people are becoming more aware of personalized news.

Scoop Direct takes the concept of personalized news and delivers content from thousands of sources most of us have never been able to have access to in the past.

You want to know what your competitors are doing, you want to know what your suppliers are doing, you want to know what your customers are doing. You also want to know what people are saying about your own company.

With Scoop, you can get this information, every day, reliably, with ease.

: The original business of Scoop is not online.

: We have Scoop Media Services. Basically, we create reprints of newspaper and magazine articles. Such publications as the Orange County Business Journal and Investors Business Daily use our services.

We are also venturing into the online arena, too. For example, we signed an agreement with Motley Fool to sell reprints from its site.

Our goals for the Scoop Media Services are two-fold. First, we want to sign up more publishers. Second, we want to offer new products. For example, we now provide electronic reprint services. That is, we put the article into HTML and even host it on a Website.

: Do you plan to create your own content?

: We are not in the content creation business. What we do is aggregate, organize, and distribute content, so as to meet the needs of our customers.

: Do you have employees that actually read thousands of articles each day?

: No. Our system is completely automated. We purchased extremely expensive software that reads articles and then indexes them. Plus, we have a sophisticated search and retrieval technology.

We are excited about the future of online delivery of information and news. Scoop is "leveling the playing field" for the benefit of small and medium- sized companies that previously could not afford to get the same news and information their larger competitors have had. We think this matters a lot. And we are pleased with the positive reception we have gotten from our Scoop Direct users.