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Thursday, February 06, 2003

By David Radin

Rich Koehler reminds me of Jeff Bezos, the founder of Amazon.com. He is CEO of a company. He laughs while he speaks of both fun and serious subjects. And he looks like he has broken through the dot.com clutter. However, he has done it in a decidedly low-tech way -- by creating and marketing a card game. He and a handful of associates who had been laid off by dot.com companies formed Cool Studios and created "Burn Rate," the game of dot.com failure.

Playing Burn Rate is a lot like running a dot.com company, only with a sense of humor. You select your staff. You choose your idea. And you try to force your opponents to makes stupid moves and go out of business.

It reminds me of the traditional "Game of Life" from Milton Bradley -- if the MB game had been created in a time when silicon dreams fueled lots of questionable decisions by otherwise intelligent individuals.

We'll all recognize some of the "bad ideas" that are part of Burn Rate, such as online pet store or name your price auctions. Koehler conceded that they are not all actually bad ideas; but they came off as bad ideas. Some happened at the wrong time. Others used methods that could not be successful. And some are truly bad ideas. As an example, he mentioned three high profile sports professionals who thought their names would carry an online sporting goods store to profitability. "You still have to sell your products for more than your cost," said Koehler.

Burn Rate is laced with lots of tongue-in-cheek humor that you see the moment you read the instructions. It even makes fun of itself -- by including "Dot-Com Card Game" as one of its "bad ideas."

But the way Koehler and his team have implemented it, it looks like a good idea. His executive team includes an attorney, two sales people, two marketing/PR people, a graphic designer and a CEO (Koehler). Unlike the build-it-fast mentality that got many dot.coms in trouble, he keeps his burn rate down. All 10 team members are part time -- and have other jobs to support themselves until Cool Studios takes off big.

That has helped him start to turn a profit after only three months in business, despite sparse distribution. Currently, it is tough to find the game in retail stores unless you live in the Seattle area. The rest of us will have to buy it online. But Koehler is trying to expand his distribution. Next week he'll be in New York City for the big toy fair, hoping to persuade retailers to sell his game at $15.95.

When I asked him how many units he needed to sell to make his trip to New York profitable, he quickly replied, "1,500." I was impressed. Many dot.com executives would have had to pull out their PDAs and create a spreadsheet before coming up with an answer. Koehler, though, is minding his business as a rational businessperson.

"When I was a product manager at an e-wallet company, I would not have known the answer. I was not expected to know the answer. We were supposed to make money, but we didn't have enough interest from customers who wanted to pay real money." He has interest now.

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David Radin is a nationally syndicated radio show host. You can sign up for his tip letter at www.megabyteminute.com or find an archive of his previous columns at www.post-gazette.com/interact. E-mail him your questions at david.pgcolumn@spamslicer.com

Correction/Clarification: (Published Feb. 6, 2003) Amazon.com founder Jeff Bazos was incorrectly identified in earlier versions of this column.