San Diego Business Journal

Frat parties, all-night study sessions, the pizza delivery guy , all things associated with college campuses.

Now, just imagine taking a journey into cyberspace to tap into college life across America, a place where twentysomethings connect, chat, post messages, look for jobs, find student discounts, play video games, check out the latest technology, listen to music and even read their horoscope, all for free.

Welcome to CollegeClub.com, the world's largest online community for college students.

Over the span of about an hour, CollegeClub.com's 33-year-old founder and CEO Michael Pousti explained how the company has grown from a concept into a successful, popular venture.

The meeting place was fitting , on the campus of UCSD, amid students rushing between classes and socializing. The La Jolla university is also Pousti's alma matter, evident by the UC San Diego shirt he wore.

Pousti came up with the idea of bringing college students together via technology back in 1988.

And, perhaps, such a thing would crave Pousti's own desires to mix with other students in a social setting.

"As a commuter student I missed out on a lot of the college experience," he said.

However, lack of dough prevented him from launching his unique venture.

Started On The Phone
The idea would remain idle until 1993, when Pousti launched what was then CollegeClub with fellow UCSD students Mehran Hamidi and Eric Berman, both of whom are still with the company.

At first, CollegeClub offered a toll-free number for UCSD and SDSU students.
"It was really the Internet over the telephone," said Berman, CollegeClub.com's 27-year-old general manager. "You could link up to groups and send one message out. You could press a different button and get a sports report. We had a local surf shop giving us surf reports. All the movie theaters would give us movie listings."

As funding grew, so did CollegeClub.
The company raised $7 million between 1993 and 1996 from investors such as John Kohler, one of the founders of Netscape.

A total of $30 million has been invested into CollegeClub.com to date.
A lot of that money has been used to extend CollegeClub's services, including creating a comprehensive and interactive Web community.

Move To Internet
CollegeClub moved from the phone to the Internet in late 1995 and officially became CollegeClub.com this year. The company still offers free voice mail services in which members can even pick up their E-mail messages via the phone.

Most of the content on the site (www.collegeclub.com) is created by members, who even form their own virtual clubs, from sports to entertainment to music and fashion. Members can also find out who else is online.

"We try to set a tone and make it a cool place to hang out," Pousti said.
CollegeClub.com even has 1,500 campus reps who do things like hand out fliers and take digital photos and post them on the site.

"They are spreading the gospel," Pousti said.
CollegeClub.com also allows members to shop online in the Student Savings Center. Participants include Officemax, Brooks Brothers, Clinique, Bigwords.com, Hickory Farms and Drug Emporium. CollegeClub.com has relationships with more than 75 national and more than 100,000 local merchants.

Pousti said the statistics alone lure advertisers and merchants to the site: There are 16 million college students in the United States, 95 percent of whom use the Internet, according to Jupiter Communications, an Internet commerce research firm based in New York.

And, did you know that one in four adult Web users is a college student?
Pousti, a computer fan since junior high, said technology has helped spur CollegeClub.com's growth.

Took Time To Catch On
"The (commercial) Internet happened in 1994. So we didn't have to create our own network. That made it a lot easier. Computers also got faster."

While CollegeClub.com was launched in a technology boom time, it still took a while for people to accept it, Pousti said.

He borrows from the adage: "It takes a village to raise a child."
"The thing about a community is you don't build it overnight," he said. "In the beginning we had a hard time explaining to investors what a community is. I think people are getting it now."

CollegeClub.com now has more than one million registered student members across 3,800 campuses. Pousti said the company's goal is to have 4 million members by the end of next summer.

CollegeClub.com's employees have grown, too. The company now employs 250 people, 130 in San Diego.

Pousti has managed to corral a group of innovative and dedicated tekkies.
"We have people who spend hours per day here," he said. "It's not because they have to, it's because they want to.

Only Paranoid Survive
This is a business in which only the paranoid survive, Pousti said.
"We have a saying in this office: 'If you eat lunch, you are lunch,'" he said about going out for hour-long lunches. "When you're on the Internet, speed is God and time is the devil."

Most CollegeClub.com employees work 7 a.m. to 9 p.m. Monday through Friday. Dinner is served every night, including everything from pizza to steak to pasta and sushi.

"You can't expect people to go home and buy groceries and cook dinner after working so long," said Pousti, who puts in 70 to 80 hours a week.

"We have the hottest job market in the history of the company," he said. "People don't want to be a cog in the wheel. They want to be taken care of. They want to be empowered. Our management style allows that."

Part of CollegeClub.com's management style includes turning several employees into project leaders, or CEOs of their own mini-company. These project leaders are even guided by venture capital coaches within the company who approve and fund each project.

"The Internet is moving so fast. Our fear is that we don't want to become too vertical as an organization," CollegeClub.com general manager Berman said. "We want to empower people of all different levels."

Berman gives Pousti kudos for allowing independent growth within the company. It's Pousti's vision that has led CollegeClub.com to success, he said.

Competition
"He's an absolute genius and an absolute visionary," Berman said. "Think about what we were doing on the phone. Michael has always been able to focus long-term in building scalable solutions."

While CollegeClub.com was the first of its kind, several similar companies have come and gone over the last few years. But there are still a few around, including San Diego-based Colleges.com, which received its first round of outside financing last month by digital music goliath MP3.com.

CollegeClub.com is determined to stay on top. Just last week, the company announced it will acquire its main competitor, Austin, Texas-based Collegestudent.com. The acquisition, expected to be completed early next year, will bring 350,000 more members to CollegeClub.com's community.

CollegeClub.com also recently acquired Campus24.com, the first online auction and classified advertising site targeting college students; and CollegeBeat.com, a supplier of online college event calendars and student planners.

Revenues Jump 400 Percent
Revenues for the privately held CollegeClub.com have jumped 400 percent this year over 1998, Pousti said. Revenue is generated by online advertising through sponsors like Gateway, Reebok and Bausch & Lomb.

To accommodate its growth, CollegeClub.com will move from Mission Valley to a 40,000-square-foot office Downtown in the next few weeks.

"There's a lot of energy there," Pousti said.
The company, which already has some Canadian college student members, plans to launch CollegeClub Japan and CollegeClub South America sometime next year.

What else does Pousti have up his sleeve? An initial public offering perhaps?
"Well, let's just say the company is exploring its options," he said.