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Where Are They Now? Dot-Com CEOs

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Much has been written about the iconic American brands that have recently left the corporate landscape. Names like the bankrupt Circuit City and the nowhere-to-be-found Pontiac are casualties of the Great Recession, and there are most likely more to come. But every downturn means the end of the road for certain companies. Just a few years ago, brands like Kozmo, Flooz and Pets.com were going to change the way we all shop. So what happened to the CEOs of those dot-com casualties? We caught up with a few of them.

1. Jared Polis: BlueMountainArts.com

Artist Stephen Schutz and poet Susan Polis Schutz had been running greeting card company Blue Mountain Arts for several decades before their son took the business online and co-founded bluemountainarts.com. But Jared really caught the attention of the e-business world when he sold the company to Excite@Home in a deal worth $780 million. (Later, Excite sold the company for $200 million.) In 1998, he launched ProFlowers.com, a web company selling flowers direct from growers to consumers, which expanded to become Provide Commerce, which was then acquired by Liberty Media Corporation. In 2006, he founded Techstars, a seed incubator for web startups, and in November 2008, Mr. Polis was elected to the United States Congress to represent the second Congressional district of Colorado. Today, Fortune estimates his personal wealth at $160 million.

2. Joseph Park and Yong Kang: Kozmo.com

Remember when you could get a pint of Cherry Garcia, a Snickers and the New York Times delivered at 2:00am? Those were the days. And that's also the reason Kozmo is no more. The company's unsustainable business model promised free delivery of anything, in under an hour. And they lost money on every delivery. The two founders, Joseph Park and Yong Kang, took different paths after they closed shop. Park went to Harvard Business School and is now running Askville, a community site operated by Amazon.com. As for Yong Kang, he returned to Wall Street, and as of May 2008 listed his occupation as investment banking at Lehman Brothers. Rough decade.

3. Greg McLemore: Pets.com

pets-com.jpg
Before the dot-com bubble burst, there were about a half-dozen pet supply sites on the web, all getting ridiculous amounts of venture capital money (that should've been our first clue). After Pets.com went bankrupt in 2000, CEO Greg McLemore went on to create other start-ups. According to his LinkedIn page, he started stock footage company eFootage in 2003 and DataRefinery (a company developing a set of web based software tools) in 2006. He also hopes to sleep sometime around 2012, but that's subject to change.

4. Ernst Malmsten and Kajsa Leander: Boo.com

Boo.com was the brainchild of Ernst Malmsten, a poetry critic, and Kajsa Leander, a former Vogue model, who grew up together in Sweden. In the 90s, they wanted to create a website where the most fashionable people would buy their clothes, and before they had sold a single item, Fortune magazine had christened them "one of Europe's coolest companies." After the highly publicized launch, it took all of 18 months for the company to burn through $135 million in venture capital before closing down in May of 2000. Now, Kajsa Leander lives in Venice with her husband, raising their three children, and Ernst Malmsten runs a London-based agency that represents architects, fashion designers, graphic designers and other creative types. He also wrote a book about the experience called Boo Hoo: a Dot.com Story. As for Boo.com, it's now a travel website with user-generated reviews...no sign of Miss Boo anywhere, though.

5. Robert Levitan: Flooz.com

flooz.jpgFlooz was the Whoppi Goldberg-promoted site that offered redeemable credits when consumers purchased specific products. A lack of interest and a little fraud (apparently, parties within the Russian mafia were using Flooz as a money laundering vehicle) forced the company to shut down in 2001. As for the CEO, Robert Levitan (who had previously founded iVillage) went on to create Yearlook Enterprises and Pando Networks, a company that provides peer-assisted content delivery. These dot-com guys are quite the overachievers, aren't they?

6. Josh Harris: Pseudo.com

Josh Harris was one of the most interesting characters of the web 1.0 days. The founder of both Jupiter Communications and Pseudo.com (a live audio and video webcasting website), Harris became notorious for his six-month, $600,000 project "We Live In Public," a Big Brother type concept in which he placed more than 100 artists in a New York City human terrarium, capturing every move the artists made. After Pseudo.com filed for bankruptcy in 2000, Harris literally bought the farm: a 153-acre apple orchard in New York, which he sold in 2006. These days, Mr. Harris is the CEO of the African Entertainment Network based in Sidamo, Ethiopia. I'm sure he's capturing the entire experience on video.

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The Secret to the World's Most Comfortable Bed Might Be Yak Hair
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Tengi

Savoir Beds laughs at your unspooling mail-order mattresses and their promises of ultimate comfort. The UK-based company has teamed with London's Savoy Hotel to offer what they’ve declared is one of the most luxurious nights of sleep you’ll ever experience. 

What do they have that everyone else lacks? About eight pounds of Mongolian yak hair.

The elegantly-named Savoir No. 1 Khangai Limited Edition is part of the hotel’s elite Royal Suite accommodations. For $1845 a night, guests can sink into the mattress with a topper stuffed full of yak hair from Khangai, Mongolia. Hand-combed and with heat-dispensing properties, it takes 40 yaks to make one topper. In a press release, collaborator and yarn specialist Tengri claims it “transcends all levels of comfort currently available.”

Visitors opting for such deluxe amenities also have access to a hair stylist, butler, chef, and a Rolls-Royce with a driver.

Savoir Beds has entered into a fair-share partnership with the farmers, who receive an equitable wage in exchange for the fibers, which are said to be softer than cashmere. If you’d prefer to luxuriate like that every night, the purchase price for the bed is $93,000. Purchased separately, the topper is $17,400. Act soon, as only 50 of the beds will be made available each year. 

[h/t Travel + Leisure]

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Mike Mozart, Flickr // CC BY 2.0
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Fart Gallery: A Novel History of Spencer Gifts
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Mike Mozart, Flickr // CC BY 2.0

When U.S. Army Corps bombardier Max Spencer Adler was shot down over Europe and imprisoned by the Nazis during World War II, it’s not likely he dreamed of one day becoming the czar of penis-shaped lollipops and lava lamps. But when Adler became a free man, he decided to capitalize on a booming post-war economy by doing exactly that—pursuing a career as the head of a gag gift mail-order empire that would eventually stretch across 600 retail locations and become a rite of passage for mall-trekking teens in the 1980s and 1990s.

To sneak into a Spencer Gifts store against your parents' wishes and revel in its array of tacky novelties and adult toys felt a little like getting away with something. Glowing with lasers and stuffed with Halloween masks, the layout always had something interesting within arm’s reach. But stocking the stores with such provocations sometimes carried consequences.

A row of lava lamps on display at Spencer Gifts
Dean Hochman, Flickr // CC BY 2.0

Returning from the war, Adler sensed a wave of relief running through the general population. Goods no longer had to be rationed, and toy factories could return to making nonessential items. The guilt of spending time or money on frivolous items was disappearing.

With his brother Harry, Adler started Spencer Gifts as a mail-order business in 1947. Their catalog, which became an immediate success, was populated with items like do-it-yourself backyard skating rinks and cotton candy makers [PDF]—items no one really needed but were inexpensive enough to indulge in. In some ways, the Spencer catalogs resembled the mail-order comic ads promising X-ray glasses and undersea fish kingdoms. Instead of kids, Adler was targeting the deeper pockets of adults.

Bolstered by that early success, Adler moved into a curious category: live animals. He had small donkeys transported from Mexico and marketed them as the new trend in domestic pets. LIFE magazine took note of the fad in 1954, observing the $85 burros, being sold at a clip of 40 a day, “except for stubbornness, are very placid.”

Burro fever foreshadowed the direction of Spencer’s in the years to come. The Adlers opened their first physical location—minus livestock—in Cherry Hill, New Jersey in 1963, expanding on their notion to peddle unique gift items like the Reduce-Eze girdle, which promised to shave inches off the wearer’s stomach. That claim caught the attention of the Federal Trade Commission, which chastised the company for advertising the device could reduce body weight without exercise [PDF]. The FTC also took them to task for implying their jewelry contained precious metals [PDF] when the items did not.

Offending the FTC aside, Spencer’s did a brisk enough business to garner the attention of California-based entertainment company Music Corporation of America, Inc. (MCA), which purchased the brand and proceeded to expand it in the rapidly growing number of malls across the country in the 1970s and 1980s. (The mail order business closed in 1990.)

Brick and mortar retail was ideal for their inventory, which encouraged perusal, store demonstrations, and roving bands of giggling teenagers. The company wanted its stores to capture foot traffic by stuffing its aisles with items that had a look-at-this factor—a novelty that invited someone to pick it up and show it to a friend. When executives saw specific categories taking off, they “Spencerized,” or amalgamated them. When there was a resurgence of interest in Rubik’s Cubes and merchandise from the 1983 Al Pacino film Scarface, visitors were soon greeted in stores by stacks of Scarface-themed Rubik’s Cubes.

Mike Mozart via Flickr

Apart from its busy aesthetic—“like the stage from an old Poison video,” as one journalist put it—Spencer's was also known for its inventory of risqué adult novelty items. Pole-dancing kits and sex-themed card games occupied a portion of the store’s layout. The toys captured a demographic that might have been too embarrassed to visit a dedicated adult store but felt that browsing in a mall was harmless.

Sometimes, the store’s blasé attitude toward stocking such items drew critical attention. In 2010, police in Rapid City, South Dakota seized hundreds of items because Spencer's had failed to register as an “adult-oriented business,” something the city ordinance required. As far back as the 1980s, parents in various locales had complained that suggestive material was viewable by minors. In 2008, ABC news affiliate WTVD in Durham, North Carolina dispatched two teenage girls with hidden cameras to see what they would be allowed to buy. While they were shooed away from a back-of-store display, they were able to purchase “two toy rabbits that vibrate, moan, and simulate sex” as well as a penis-shaped necklace.

As a possible consequence of the internet, there are fewer incidences of parental outrage directed at Spencer’s these days. And despite the general downturn of both malls and retail shopping, the company bolsters its bottom line with the seasonal arrival of Spirit Halloween, a pop-up store specializing in costumes. Despite only being open two months out of the year, their Spirit locations contribute to roughly half of Spencer's $250 million in annual revenue.

Today, the chain’s 650 stores remain a source for impulse shopping. They still occasionally court controversy over items that appear to stereotype the Irish as drunken oafs or other inflammatory merchandise. With traditional mall locations expected to shrink by as much as 25 percent over the next five years, it’s not quite clear whether their assortment of novelties will continue to have a large retail footprint. But so long as demand exists for fake poop, fart sprays, and penis ring toss kits, Spencer’s will probably have a home.

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