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Illustration by Jeremy Russell


By Annalee Newitz

MY PARTNER, JAY, has been using this new word "vaporware" a lot lately. I ask him what's up with his company, and he says (with an expansive hand gesture), "We make vaporware."

"How so?"

"We have no product anymore--my company is just a bunch of marketing guys leading VCs around the office."

As an engineer, Jay was frustrated by the sudden evaporation of a tangible product at his company. He's there to build something, not to throw branding concepts around and fantasize about niches and targets. If coders do software and backenders do hardware, then marketers and VCs do vaporware. And in today's metastasizing IPO market, vaporware is everywhere.

Startups run on vapor. A few smarty-pantses get together and hire somebody to do a bunch of pyrotechnics and set off a couple of geysers during meetings with the VCs, who are asking themselves: "How luscious is this vapor? Would people buy this vapor in a year? What kinds of trinkets can money buy to make this vapor into a concrete thing that will be piled up in gleaming stacks at Fry's?"

Just as an aside, did you know that, in Silicon Valley, there are two separate Fry's electronics stores that have strip clubs right across the street from them? See, it's all about vaporware--the hazy, ambiguous, steamy stuff of seduction.

The problems start to come in when a company gets too interested in vapor and forgets about all the other important parts of being a successful business: you know, little things like having a coherent product line and a reasonable marketing plan for it.

But in a world of value-adds, business-to-business and branding, how do you really know which companies are vapor-only and which are going to step out of the steam room into the real world? John Doerr might have an answer full of numbers and synergies and business intuition, but I have only complaints.

There's this new company in San Francisco called TradeYard.com, and it's positively vaporific. The first sign of this was, in fact, a sign. When TradeYard moved into its cushy new downtown office building, it posted a giant sign next to the elevator--its logo, in fascistic red, black and white (which would suggest that TradeYard was so BIG that it owned the whole floor). But, of course, TradeYard only rents a third of the floor, and other residents of said floor quickly made their irritation known by taping another sign below the TradeYard logo that read "sucks ass!"

So what is TradeYard's product all about? Check out the company's mission statement, which offers three buzzwordy, vaporous definitions: "business-to-business equipment," or "creat[ing] value ... by making it easier, quicker and more affordable to buy and sell equipment on the Internet" or "the used equipment industry." OK, so what do you think TradeYard does? Any products on the agenda? Well, no. Right now, the company is mostly talking a lot about how it has gotten money from what it calls "the biggest names in media, new media, ecommerce and finance." (See www.tradeyard.com/press/press.asp.)

So, TradeYard officials got some bigwigs to throw some money at the company--a lot of bigwigs. That means a whole bunch of people who have lots of money didn't mind parting with a teeny bit of that money for yet another multimedia, e-commerce, business-to-business, value-added bucket of vapor. You connect the dots. Nobody said, "Hey, this TradeYard is so hot we should VC them into the next dimension." They said, "Eh, all right, give 'em a little bit."

Maybe I'm being unfair. It's true that if you go to construction.tradeyard.com, you can enter auctions to buy used construction equipment, which is sort of what TradeYard said it would do in its mission statement.

Nevertheless, give me a break. Auctions are hardly a product--everybody does those. And auctions aimed at the teeny construction industry are even more vaporous. How many people who need used construction equipment shop online anyway? And aren't they already using eBay?

I should start an Internet industry version of The Gong Show. Companies like TradeYard.com are ripe for it. Can't you imagine some marketing person saying, "And then we'll do, uh, auctions ... ." GONG!

Annalee Newitz ([email protected]) is a surly media nerd who has nothing better to do than complain about bad business plans.

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From the February 17-23, 2000 issue of Metro, Silicon Valley's Weekly Newspaper.

Copyright © 1999 Metro Publishing Inc. Metroactive is affiliated with the Boulevards Network.

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