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IEG backs Net sponsorship marketplace
Published January 21, 2002
Sponsorship research and evaluation agency IEG and a Rockefeller heir are teaming to create IEG SponsorDirect (iegsponsordirect.com), a sponsorship marketplace and yellow pages for the Internet that allows potential buyers to search for appropriate properties and for sellers to list them.
While sponsorship is perhaps the ultimate who-you-know business, SponsorDirect's principals are confident that the efficiency the Internet provides for those searching for and securing information, along with its unrivaled ability to gather communities of like-minded individuals, will keep SponsorDirect from going the way of sites like Pets.com and Quokka Sports.
"Many start-ups failed because they had completely unrealistic projections as far as how quickly consumers would adopt their new technologies," said Mark Rockefeller, who has an investment banking background and founded the company in 2000. "We are prepared to make this a long-haul proposition."
Rockefeller said SponsorDirect has raised about $2 million via angel funding. IEG has taken a minority equity stake and sits on the new company's board of directors.
Rockefeller projects the venture will break even in two years. For it to do so, it will have to emulate the success of Internet survivors like travel, shopping, auction and brokerage sites, which sold consumers on the notion that the Internet was an easier, cheaper and more efficient way to do business than had traditionally been transacted off-line.
"As a [former] buyer of sponsorships, I was constantly being sent proposals that didn't have even the most basic information, like demographics," said Meltem Tekeli, a former MasterCard sponsorship executive and now chief marketing officer at SponsorDirect. "This will save buyers and sellers a lot of time. The idea isn't to take people out of the mix, because this is a very people-driven business. What we do is automate the first part of the process."
SponsorDirect's business model sees revenue coming from properties listing on the site, whose fees range from free for a basic listing to no more than $500 a year. The vast majority of revenue is projected to come from a maximum 5 percent finder's fee that the listing property will have to pay SponsorDirect out of the contract it signs with the new sponsorship buyer.