Post-Zethus -- Goldman Sachs Is
No Longer Walking Lopsided

Venture Capital Pitfalls... In a humorous article in the New York Times about three-card monte, Luc Sante recently concluded that -- if you played three-card monte more than once -- "You are too good for this place. You need to return to where the larks are singing, where the bluebells are in bloom, and where you can just park your wallet on the curb if it is making you walk lopsided."  (April 15, 2001) ...  I thought about this quote after reading Motoko Rich's article last week about Goldman Sachs-backed Zethus, which filed for bankruptcy in March after reportedly running through $15 million in less than a year and a half (April 23, 2001).  No wonder Jim Hime, ex-CEO of Zethus, was quoted as saying that attracting Goldman Sachs capital was "beyond our wildest dreams."

Just read Lee Schalop's latest newsletter on "Real Estate and Technology" from Banc of America Securities (April 2, 2001), and you realize that Goldman has lots of company in bluebell-land.  The report lists 84 real estate dot-com companies (both commercial and residential) that are out of business or almost out of business.  And collectively these companies must have run through hundreds of millions dollars.  Schalop is particularly skeptical of transaction-related companies.  "Through our conversations with both real estate owners and e-real estate companies, we've learned that many of these transaction-related companies are having a hard time convincing users to log on and conduct business online, especially for large transactions."  For sure. 

And that's precisely why this year's PikeNet Forum is devoted to the practical needs of traditional players in the real estate process -- owners, tenants and service providers.  This is not bluebell-land.  This is the reality of a highly personal industry.  So what services are gaining traction?  What are the true costs of adoption?  Which business models really generate cash? 

Forum Hotel Special... The Forum starts this Wednesday afternoon, May 2, in San Francisco -- www.pikenet.com/forum.  And, yes, you can make last-minute hotel reservations at The Palace.  In fact, there are still a dozen rooms left in the PikeNet room block.   So as an additional incentive, if you're one of the first twelve persons to book a NEW room reservation at The Palace, PikeNet will reduce the rate to $158 per night.  Just make your reservation normally at the PikeNet rate block rate (415-512-1111) and send e-mail to me for your special rebate.  Thank you!

--Peter Pike / ppike@pikenet.com