The Colgate Scene
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A student entrepreneur grows up
Bill Porta '86 is ready to take his Earlville-based business worldwide
|by James Leach|
This story began in the fall of 1982 when Bill Porta, a first-year student from
Brooklyn, started a campus business delivering birthday cakes to his classmates
from his fifth-floor room in East Hall. |
"My uncle gave me the idea," said Porta. "He said, `Buy a cake for $5 and sell it for $10. You'll be OK.'"
Eighteen years later the business has moved five miles down the road to headquarters in Earlville, the customer base is now international, and the scope of products has grown from cakes (which are still available) to include a choice of more than 900 items, but the concept is the same. Porta is still helping his customers celebrate the special occasions of their loved ones, friends and associates by delivering a personalized remembrance to their door.
While Porta no longer dresses up in his clown suit and plays the Beatles' Birthday -- United Parcel Service and a nationwide network of affiliates handle the deliveries these days -- the focus is still on providing a memorable gift, on time, at a fair price. "We're old hands at this," he says, "and nobody does it better."
Two keys to success in his business are marketing and fulfillment, says Porta -- find the customers and satisfy them. On the marketing side, Porta came early to the World Wide Web, and his success over the Internet is a story in itself.
The business press is filled with stories of .com companies operating on the margin, mortgaging their futures to capitalize their potential for growth and suffering years with negative balance sheets. Porta went online in 1995 and was making money from his Internet operations within a week. He was so surprised by the volume of the first responses that he called the folks who had placed orders to be sure it wasn't a practical joke. And when it proved not to be, he began pouring all his profits back into the Internet side of the business.
One of Porta's investments was in several Internet domain names. Having begun his business as Campus Cakes, he grew to Occasional Expressions, then came on line as USAGLAD.COM, and ultimately added the name that has led to today's success: USGIFTS.COM.
Porta owns the companion toll-free number -- 1-800-USGIFTS -- acquired at a bargain price. The combination has attracted business that puts Porta's Earlville operation in competition with major online gift merchants such as FTD and 1-800-FLOWERS.
Bill Shiraki '90, Sara Craig '99 and Dylan Strong '00 focus on fine-tuning the online marketing strategy that keeps USGIFTS.COM and its many companion sites among the top referrals made by Internet search engines such as Yahoo!, Lycos, Excite and Infoseek. Heidi Butterworth '01 helps Porta track where USGIFTS.COM ranks in the top ten out of the legion of other vendors of cakes, cookies, balloons and specialty gift baskets.
Porta's success has attracted not only customers, but potential investors and buyers. He has entertained multimillion-dollar offers for his best domain names, and been courted by venture capitalists who would invest in his business -- but at a price that squelched the deal in the end.
"There were so many strings attached to the venture money," Porta said. "They wanted me to move the business to metropolitan New York or Southern Connecticut."
But Porta has a strong attachment to central New York and feels his Earlville location allows him to be profitable. Operating from three old homes, he has minimal overhead ("One twenty-fifth what I might be paying in a metropolitan area," he said) and no zoning hassles. He has ready access to capable employees, and his employees' cost of living is low enough that he can pay a good wage and keep his labor costs within reason. Beyond that, he enjoys living among the rolling hills of rural upstate.
The USGIFTS Colgate brain trust includes Bill Shiraki '90 (left), Dylan Strong '00, Sara Craig '99 and owner Bill Porta '86. Heidi Butterworth '01 (not pictured) helps track the company's position on the Internet.
Since the early days of Campus Cakes Porta has received help and advice from Colgate faculty and friends. Colgate roommate Raveen Bharvani '85, now a financial consultant, maintains daily contact from Singapore, advising Porta on matters that he says have been critical to the company's success.
Sympathetic faculty members encouraged Porta in the early days. Professor Frank Farnsworth was an adviser to the young entrepreneur and kept in contact for many years. Professor Jeff Baldani supervised a January independent study in taxation that allowed credit for practical experience. And Professor Jerry Balmuth oversaw Porta's independent study of the Philosophy of Business.
Later on Porta encountered Paul Schupf '58, a Hamilton-based fund manager who has been an important source of guidance and practical business advice. Schupf helped Porta think through the deals offered by the venture capitalists. He challenged Porta to sharpen his focus on the accounting side of the business, and to use what he learned to make critical decisions that would allow the company to profit while becoming substantially larger. "It was Paul who advised me to hire the best people I can afford," said Porta.
Schupf's advice led Porta to invest in more Colgate graduates as an integral part of his business strategy. "They know how to learn," he said. "The smarter the people, the better our business runs, and these Colgate graduates are key." It took Porta almost three years to get his friend Bill Shiraki '90 (a former attorney for the US Department of Justice) to leave Washington, DC and join USGIFTS.COM in Earlville.
When Porta was exploring sources of funding to expand his business early this spring, he turned to the small business mentoring program coordinated through a local non-profit organization called The Partnership for Community Development. Colgate joins with the Village and Town of Hamilton to sponsor the partnership, and Professor Adam Weinberg and Alumni Director RuthAnn Loveless help coordinate the mentoring program. They directed Porta to Walter Steinmann Jr. '79, who helped analyze a variety of funding and marketing strategies. "Walt drove all the way from New York City to meet with us," Porta said. "In the first 20 minutes he had given us 20 good ideas.
"What people buy with venture capital is ideas. Walt and the PCD are providing us with good ideas through the mentoring program, and good ideas are more valuable than money."
For Steinmann, the mentoring is "an opportunity to help a fellow alum who's trying to make it on his own."
Bill Porta has spent 18 years growing his business from Campus Cakes to a profitable online service that is now poised to reach clients around the world. "We've worked 24 hours a day and we're almost there," he says. With help along the way from a community of Colgate friends and supporters, the worldwide venture that he started in Hamilton has wound up in . . . well, Earlville. And he couldn't be happier.
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