What I saw during the dot-com era of PR (mid 1990s to late 2000)
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The New Economy hype (1995-2001) was driven by many factors including the greed of the Dot-com CEOs. However, feeding the hype was a volatile mixture of VCs looking for quick and easy return on others peoples money, CEOs and staff expecting to make millions in matter of months and the PR agencies that created the buzz and hand fed distilled key messages and spin to the media that ate it up without a critical eye. Finally, the public bought the idea of 20-somethings running the world and making millions in the market (the real estate boom was almost a repeat of this).
This is what I saw, what it I did and how I made a ton of money in the process and almost lost my sanity.
To keep up with the boom in the late 1990s and not be left behind by the new economy I recognized that I needed to retool my career, or risk becoming road kill myself. So I changed my focus from consumer brands by switching agencies from a successful boutique on Miami Beach’s Lincoln Road to a major PR shop with a heavy tech focus. Enrolled in a Master of Arts course the New School University for media management in the New Economy and later took a six-month assignment in Silicon Valley.
Making the Jump to Dot-com PR
To be a new economy PR leader I needed to be with a new economy agency. So I left a cushy partnership position with a corner office over looking Lincoln Road on Miami Beach to move to a downtown office building filled with bankers. No more watching supermodel wannabes along Lincoln Road, or bikini-clad models in early morning photo shoots. No more hot SOBE chicks rollerblading past my café table during lunch. Ah, the sacrifices to become a new economy leader.
Leaving the South Beach shop was not easy. However, it was the only thing to do in order to become a new economy leader. Joining Edelman PR in the late 1990s as a Vice President with a mandate to build an Internet group was an incredible opportunity. Dot-com fever was hot. Before taking off on a new business hunt for fresh dot-com meat, my strategy was to consolidate my hold on existing clients and build a portfolio of dot-com / technology accounts.
On the Prowl: The Hunt for New Business
You either love or hate going after new business. For me it’s like thrill you get from chasing woman. However, as a very happily married and totally faithful husband in a committed relationship, I channel that genetically coded energy into going after new business. Seeing my therapist and taking anti-depressants doesn’t hurt the relationship either.
The best time to be in PR with responsibility for bringing in new business was from 1998- 2000. There were so many opportunities for new clients you had to be really incompetent not to close on the deal.
The high point, or low point of this period depending on how you view it, was at the Miami Internet alliance’s network meeting at the Biltmore Hotel. After registering and getting my name tag with my Edelman Public Relations clearly visible, I was literally overrun by various dot-com companies all seeking PR. I had to beat them off with a stick in order to get to the cash bar, which was the only site at that meeting that actually made any revenue. I had several dot-comers buy me drinks and make appointments for presentations.
During the dot-com PR hay-day, we’d refer to these newly minted companies flush with VC cash as low hanging fruit for easy pickings. We would cherry pick which ones we wanted and what price. We would tell perspective clients that they would be lucky if we chose them among all the competing opportunities for us to represent.
Yes, we were arrogant. We are on top of the game. We were also making money hand over fist.
Fees jumped from an average of $5,000 per month to $15,-20,000 as a minimum. Sometimes we would ask for an exorbitant fee and be told that it was within budget. We were fast becoming the catalyst for the burn rate at several client companies, where our fees were either the first or second largest expense item they carried. God save us from ourselves, but the money was too good to pass up. Especially the end of year bonuses I had negotiated in my contract based on my book of business and my annualized run rates. So my incentive was to grab as much high-paying clients without regard for what they did or their eventual economic viability.
My Silicon Valley Days
In Late February 2000 right in the middle of this madness, I received the call for an assignment in our Silicon Valley office to take a 6-8 week assignment to help out on a major account, which would later turn into a six-month gig on the most exciting client in the US, the Apple Computer account.
First I had to clear this with my wife, Silvia, on how we would mange my commuting from Florida to Silicon Valley as well as managing her frequent trips to Brazil. We decided that I would come home every two weeks for a four-day weekend and that her next trip to Brazil would coincide with the kids’ Spring Break, so I could take them to California with our live-in nanny.
Then I had to negotiate the details with my boss and staff on how I would still manage my client portfolio from 3,000 miles away. We would depend on cell phones, e-mail and IM (this was before SM, facebook, twitter, etc.), plus a daily conference call, which would start at 9:30 eastern time. This way I would be able to stay involved in all my accounts, including, Apple, which is one of the largest accounts Edelman had at the time billing more than $250,000 per month and I was going to be in charge of the whole account.
Finally, after all this back and forth negotiating the details as well as interoffice compensation from the Silicon Valley office to the Miami office I was on my way to Edelman’s office in Mountain View, California. All my expenses were to be paid by Edelman and billed to Apple and the Miami office was to be paid 75% of my billable time with the remainder being billed by my Miami clients.
I took the penthouse apartment (yes I had that in the deal) at the Marriott and had a mustang convertible rental. I also negotiated a sweet side package bonus based on how many months I was to manage both the Apple account and my Miami portfolio.
Now that I was on my way for real, the assignment sounded exciting and at the very least would be a great resume builder, if not a gateway into a Bay area-based high tech paying job flush with stock options. Having previously lived in the Bay area when I was in the US Navy, I was already in love with the idea of going back – even if only for a short time. However, I knew the hardest part about the assignment was keeping my feet firmly planted in the reality of my world, which was now in South Florida, plus I was committed to finishing my masters at the New School University in New York on Media Management.
My grip on reality would be tested over the next several weeks and months as job offers with huge sign on bonuses came my way, the lure of stock options become a currency.
My first few days in the Valley were spent getting up to speed with the account, the account team, as well as with the business culture in Silicon Valley, which seems to be work hard and make money, then work some more. Repeat.
I divided my time working on-site at Apple and in Edelman, as well as managing my accounts and staff in Miami. My days started at 5:30 a.m. and ended late in the evening doing e-mail on that days’ events back in Miami. Burn-out was fast approaching.
I was filling several important positions, both internally at Apple and for Edelman. As a VP for the agency I was the most senior person working onsite and had the most day-to-day contact with the client, including the Apple PR team and with Jobs (only once). My responsibilities included working closely on PR strategies for new product launches and being a liaison between the agency and the client, which often meant being a corporate therapist. By the second week I started receiving calls from headhunters representing dot-com this or dot-com that start-up, as well as being courted by my company and by Apple to consider staying.
I also became fascinated by the group Justice for Janitors and their over the top PR tactics to call attention to the fact that the people literally cleaning up the mess left behind by all these high-tech firms were only earning $7.25 per hour and no healthcare. About once a month they would picket and protest in front of some Silicon Valley tech-operation. I learned about them when they descended on Apple where they spent an afternoon protesting and picketing in front of Apple’s campus. They would target other offices in the next several months including Edelman’s Mountain View office building sitting on the intersection of El Camino Real and Castro Street, in the heart of the Valley.
Before heading back to Miami the Edelman GM in Mountain View offered me a promotion to SVP, a $100,000 pay raise plus a $4,000 monthly housing allowance for up to 12 months bringing total compensation before bonuses to well over $250,000. This was an incredible offer even before thinking about negotiating a better deal. What would the Justice for Janitors think about this, was all I thought about.
From a purely career driven perspective taking this job was a no brainier. Greater opportunity, more exciting projects, ton of money.
However, the South Florida- Bay Area commute was putting an enormous strain on my family life. For the kid’s Spring break I took them to the Bay Area, along with their nanny, while Silvia was in Brazil. On the same day the kids were returning to Miami from San Jose, I was flying to New York to finish the semester at the New School while my wife was flying from Rio to Miami. This was sheer madness and we had to stop it. Shortly after this I remembered something I once said a long time ago that my family is more important than my career. Now was the time to live up to those words. Shortly after this trip I ended the assignment in Silicon Valley, re-acquainted myself with my wife, therapist and my family.
I spent the next year or so at Edelman’s Miami office as Senior Vice President and left shortly after 9-11. Now I run my own PR and marketing agency and could not be happier building my own agency and client base on my terms. I look back at the dot-com boom days and I am so glad they are over. The lessons we learned back then are being forgotten today amidst the real estate collapse, a recession and a blind faith in new technologies without a way to monetize them. Lessons learned during the dot-cm days and how I apply them to my agency:
Clients need to have a real business plan and PR is not an exist plan
EBITDA needs to be based in reality for start-ups and tech companies (look it up)
There has to be ROI for PR and marketing activities – for this we always build in metrics
We do not work for clients that want PR by the pound (number of clips or hits) but those that value strategic planning and integrated marketing communications and want to build brand, market share and build a long-term relationship
- Clients have to pay up front and we don’t give away creative ideas or strategic thinking to prove what we know (we bill for that – always)
- Reputation is the most important value you can have, I turn down accounts that I don’t believe in or people I don’t trust
Alec J. Rosen has 20 years of communications experience in both agency and client side environments where he has successfully created and managed public relations, media relations and marketing campaigns for a wide range of clients from start-ups to Fortune 500 firms. His areas of specialization include marketing and branding with an emphasis on business-to-business, consumer marketing, healthcare and technology. Alec has also successfully launched dozens of new products and companies across all business categories. Alec has held senior positions in major PR agencies including, Senior Vice President, Edelman, Miami and Mountain View, CA. and Client Services Manager at Burson-Marteller, Miami.