Tomes have been written about the early Web boom and bust, but for those who were there it's a lot more like that Bruce Springsteen song:
“Glory days well they'll pass you by Glory days in the wink of a young girl's eye Glory days, glory days”
“It was a brave and heady time when we realised that we - as a generation - could recast the world in our own image,” says Xenopoulos. “Broadband hadn't yet emerged and so the Internet we experienced in South Africa was not dissimilar from the Internet being uncovered in the rest of the world. This meant that we were surfing an up-to-the-minute wave - implementing new ideas and technologies for our clients at the same time as our counterparts overseas.”
The dotcom era was studded by the spectacular rise of just about any business that had an “e” attached to the name. These were the days when a company called Boo.com spent $188 million in a couple of months trying to set up an online fashion store.
Round about the same time, a young Xenopoulos was setting up Metropolis, a local online business. “Metropolis was a microcosm of what was happening in the USA during the dotcom boom and bust. We were one of the few South African Internet companies that went the IPO route, so we really got a taste of what it was like to surf that crazy wave,” says Xenopoulos.
Together with his partners, Xenopoulos formed and listed the company in 60 days, raised R100 million in a week, and grew from three people to over 300 in just a couple of months. Xenopoulos was already viewed as something of a boy genius, having successfully set up VWV at the age of 24 and sold it shortly after.
With this experience already under his belt, Xenopoulos rushed ahead to secure First-Mover Advantage in the B2B space, with his colleagues at Metropolis, to position themselves for the moment when the flood-gates of e-commerce opened. “Unfortunately, they never did! We were not alone in miscalculating this opportunity. In fact, almost every company worldwide chasing the same strategy as ours came up short in the same way.”
But Xenopoulos has no regrets. “We had a vision and we implemented it. Unfortunately, our timing was wrong. And if there is one thing that I have learned from that experience, it is that timing is everything. Ironically, I have discovered that in businesses it is often worse to be too early than it is to be too late.”
Older and wiser, Xenopoulos has developed a strong reputation for his work in creative fields like advertising, filmmaking and scriptwriting. These strengths have consolidated at 2.0 Media and the emerging field of branded content, which is opportune given that branded content is enjoying explosive growth here and abroad. Xenopoulos chatted to Mandy de Waal about how he first grew to love the Internet, the movie business and social media's new rules.
Traditional advertising has already hogged too much time on the life-support machine.
Jason Xenopoulos, creative director, filmmaker and media entrepreneur
Mandy de Waal: When did you first get interested in the Internet?
Jason Xenopoulos: I suppose my interest in the Internet can be traced back to an early love of computers. At the age of 11, I was given a Sinclair ZX81 (the very first personal computer to hit the market). It had 1k of RAM!!!
My direct interest in the Internet began in 1993 when I was working on a sci-fi screenplay called Stealing Back Sex. I had just returned home from New York and realised that the best place to dig for ideas was online. The World Wide Web was only just emerging, and no one really knew what it was.
It was while researching this sci-fi screenplay (and playing BBS games like “Bordello”!) that I discovered the incredible opportunity that lay in wait for brands online. I took this newfound passion to VWV Studios (for whom I had been writing corporate audiovisuals) and we agreed to start a new business that would focus on using the Internet as a corporate communications platform.
MdW: What did you learn from the glory days of SA's dotcom boom and bust?
JX: That consumerism will ultimately drown out the innocence of utopian idealism.
MdW: How has the Web evolved since then?
JX:Restrictions in the South African telecoms environment have retarded the rollout of low-cost, high-speed broadband connectivity. As a result, South African online consumer behaviour has not evolved as quickly as it has in developed markets. The result is that brands and agencies have been slow to embrace the Internet as a new medium. This is changing. Broadband has finally arrived in South Africa and we are likely to see another major inflection point in the growth of the online media industry.
MdW: The dotcom period was typified by reckless investment by VCs and cash burning by start-ups? Any thoughts on this?
JX:There was nothing reckless about what we did. It may seem so in retrospect, but we honestly believed in a future that did not emerge. If we were alone in that belief, I would call it a delusion. But the whole dotcom world believed it. We did not mismanage the business or squander funds on lavish corporate luxuries. We worked our asses off - sweated blood - to win a war that turned out to not be worth fighting!
MdW: Then the market contracted and resulted in the crash. What lessons were learned in the fall out?
JX: The fundamentals of good business - strong revenue, free cash flow, and solid margins - can not be papered-over with fancy strategies and hypothetical assumptions.
MdW: You were hugely successful at a very young age. What did you learn from the experience?
JX: I only wish that I had been more aware of what an amazing opportunity it was at the time. Looking back I realise how fortunate we were. We had a vision and we chased it with all the naive courage and energy of youth. We built a great business - one that was peopled by an amazing group of individuals who have gone on to shape the online industry in South Africa. I did things at 24 that I could never do now. As Janis Joplin says: “Freedom's just another word for nothing left to lose!”
MdW: You spent some time in advertising at Y&R - what did you learn there?
JX: That traditional advertising has already hogged too much time on the life-support machine. It's time to pull the plug and hand the machine over to the next dying business model that is about to be euthanised by the Internet.
MdW: Why did you get into the movie business?
JX: I have been interested in storytelling from a very young age. I began writing poems and novels when I was still in primary school and initially attended Wits Drama School for a couple of years. While I was there, I realised that my real love was for film. I transferred to New York University's Tisch School of the Arts, where I spent four years studying film and TV. I came back to South Africa to make my first film - Promised Land - but when we failed to raise the necessary funding, I got involved with VWV and we launched South Africa's first major Web development company - VWV Interactive.
MdW: What experiences did you have in the movie business?
JX: The feature film is a fickle mistress, who will leave you heart-broken and penniless! During cinema's heyday, those sacrifices may have been worth it. But today, film as a medium has stagnated to the point where I no longer feel it deserves the personal compromises. It took eight years from the time I wrote the screenplay for Promised Land until the moment when we finally started shooting it. I spent another eight years chasing half-a-dozen other projects that almost happened but never did for various reasons beyond my control. The model is broken. The work is deteriorating. The Internet is the new frontier. I believe the future of storytelling lies in the interactive, non-linear hybrid forms of content that are emerging online everyday.
MdW: How did your new venture come about - what is the value proposition?
JX: 2.0 Media was born through a meeting of minds between myself and Peter Gird. We share a passion for building brands, telling stories, and doing things differently. We were both painfully aware of the fact that traditional TV commercials were a declining art form. We believe that the future of advertising rests in the area of quality content. 2.0 Media is a branded entertainment agency that helps clients to build their brands into the fabric of the content that their customers choose to consume.
MdW: How is social media reinventing the rules for brands, businesses and marketers?
JX: Social media has re-elevated word-of-mouth back to its rightful place as the key driver of consumer confidence. It has given consumers a voice. Brands can no longer assert themselves by shouting the loudest - they need to start listening.
MdW: How has social media changed entertainment and the way we engage entertainment?
JX:Social media has transformed the Web from a 'publish and browse' medium to a blackboard on which everyone is invited to make their mark. It has blurred the line between consumers and producers, creating a new generation of collaborators who are helping to drive society towards a future governed by the collective.
Share