42 Degrees - Business from a different angle

Internet years are like dog years. They seem to go by far faster than real time. That's how, at 38, with a little over a decade in the business, Brent Hoberman is the grand old man of British e-commerce. A veritable veteran of the internet, he is that most unlikely of creatures: an ancient geek.

You must remember him. For a while around the millennium, he and his business partner Martha Lane Fox were the Posh and Becks of the British dotcom world.

The photogenic duo set up online travel website lastminute.com in 1998 and came to symbolise dotcom fever on this side of the Atlantic. For a few weeks after lastminute.com went public in March 2000, it was valued at nearly £700m. Then came the crash. While most of its contemporaries went under, lastminute.com was one of the few internet ventures to survive and actually turn a profit.

Two years ago, lastminute.com (Hoberman is very particular about the dotcom suffix) was acquired by American group, Sabre, for £577m. Hoberman walked away with a very respectable £26m.

That gives him the distinction of being one of only a handful of British entrepreneurs of note to have ridden the first internet wave and still be afloat for its second coming. It's a topic he views with real optimism.

"Everything went quiet for a while," he says. "It's good to see people trying things out again. There's still room for lots of good ideas on the internet. There are still real opportunities in vertical markets such as finance, travel and anything to do with the home."

But this time round, the technology is better and has a longer reach. "Look at how mobile telephony and video online are developing, taking it into new places," he says.

And of course the internet now has far stronger financial foundations. "Social networking makes for better businesses because it allows a site to create more value," says Hoberman. "There is better monetisation of sites and, crucially, more customers are paying real money, giving a stronger base of cash flow to create new businesses."

Hoberman currently has fingers in several internet pies. He's tried his hand as an angel investor in a number of online businesses including ticket exchange viagogo.com and home moving site moveme.com. He's found time to consolidate his position in the establishment with a place on the board of the Guardian Media Group. And he is chairman of WAYN – Where Are You Now? – a social networking site for travellers that claims eight million members.

But his big project is a home decoration site called mydeco.com, which he is developing with Martha Lane Fox. The site is not up yet, and Hoberman is reluctant to disclose too many details at the moment. However, he says it will "help people make the right choices and get taste validation for their home decoration jobs."

In his words, it will target "the aspirational mass market ... people who want to improve their home surroundings." But it will be much more than simply an online furniture shop. It will embody many of the community and interactive features that characterise the web's second coming or web 2.0, as it is known.

The site will have a social networking component, where members will be encouraged to critique decoration, share experiences and pass on tips and advice. Unlike most currently successful social networking sites which target teenagers and geeks, mydeco.com is going after "a large female demographic."

mydeco.com has already raised a reported £5m and Hoberman says he wants it to be "one of the largest technology start-ups in Europe". But isn't that ‘think big' mentality, and the borrowing it required, precisely what got internet entrepreneurs into so much trouble first time round?

"Not at all," says Hoberman. "Scale players have better economics. One of the lessons I have taken from lastminute.com is that you need a huge ambition. Don't try to be small. Get the best people, raise loads of money and invest in the best technology."

For all the talk of finance and technology, Hoberman is an entrepreneur who operates on gut instinct. lastminute.com, he says, came out of his own experience of always doing things at the last minute. The idea for mydeco.com was born from his own experience of doing up his house in central London. "It was consumer frustration again. I found that home decoration is a fragmented market with no central place to get advice." Things must have been bad. His wife is an interior designer.

As with lastminute.com, he claims money isn't what gets him going. "My real motivation was not, and is not, financial. It is to create something, to work with people and to enjoy overcoming the challenges that go with building something."

So how, you might ask, did lastminute.com manage to walk on water while all around businesses were going under? The key point, says Hoberman, was that in all the excitement of a new medium, people simply forgot that traditional business principles of sound management and a long-term outlook still applied.

"Too many people were only in it for the money. I don't subscribe to the ‘greater fool', theory, which says that fundamentals don't matter because in a rising market there will always be a greater fool than you to offload your business on."

In the case of lastminute.com these fundamentals included uniqueness, a clear consumer benefit, a powerful brand and sufficient cash flow to continue trading. "Unlike many others, we didn't simply copy a successful US model. We weren't just a general travel site like Expedia. We had a unique concept, which was about what you can do at the last minute. Not just booking last minute flights and hotels, but also theatre tickets, restaurants and gigs and so on."

Everyone knew that last minute fares were supposed to be cheap, so there was nothing vague or hard to grasp about the benefits of lastminute.com. It held out the clear promise that it would save you money.

Uniqueness, and a clear consumer benefit in turn allowed lastminute.com to create a strong brand based largely on the personalities of Hoberman and Lane Fox. Young, good looking, articulate and posh (Hoberman was educated at Eton and Oxford), they became the well-known faces of lastminute.com when many rivals were simply a name or, less engaging still, a piece of software.

It certainly saved lastminute.com from the mistake made by many other sites – spending millions of pounds on advertising to get the brand name known.

The fact that, to this day, Hoberman remains the only well-known British businessperson actively engaged with the internet, is testament to how successful that branding was.