The Web isn't just for geeky teenagers anymore, and iVillage has taken notice. One of the first web sites to target women as an audience, iVillage offers up info on topics from careers to child care, plus free e-mail, chat rooms, a book club and online shopping. It even has a pregnancy calendar, which shows a baby's development from conception to birth. It is still one of the most prominent New Media companies in New York's Silicon Alley, despite its recent troubles in its forray into ecommerce.

Ample funding

Candice Carpenter, formerly the Chief executive of Q2 (the upscale division of the QVC home shopping channel), founded the company in 1995. Her idea was to reach out to the growing numbers of women on the Internet - with a specific focus on baby boomers. Launched with seed money from America Online, the company has been to the venture capital trough four times in its short history. On the last trip, in May 1998, iVillage gleaned $32 million - about $12 million more than it had expected to pick up. Among its other backers are Intel, Glaxo-Wellcome and the National Bank of Kuwait (a country not exactly renowned for its treatment of women).

Providing "the Stuff that Matters"

iVillage is almost as well-known for its prodigious burn rate as it is for building its carefully targeted content. It's been criticized for spending excessively on marketing. In 1997 the company shelled out piles of money on a television advertising campaign, billing itself as "Your Home on the Web for the Stuff that Matters." It later took a grass-roots tack, using volunteers around the country to introducing the site to nonprofit women's organizations.

Profits a long way down the road

Though the company has no problem pulling in the masses, it has not been as successful when it comes to bringing in the bucks. Since its founding, the company has lost a total of $76.3 million. For nine months of 1998 alone, the company reported revenues of $9.1 million and losses of $32.4 million. In December of that year, the company disclosed plans to go public in a deal worth $46 million. Like many other Internet startups, the company affirms in its offering document that it will continue to lose money "for the foreseeable future." In 1999 the company lost $107.5 million on revenue of $44.6 million.

Burn, iBaby, burn

In May 2000 iVillage conceded defeat in one its early attempts to break into the world of e-commerce when it sold off iBaby. The decision to ditch iBaby, which sells everything from strollers to breast pumps, is seen as a significant shift in strategy for iVillage. When the company acquired a $1.35 million majority stake in iBaby in April 1998, it was widely heralded as a groundbreaking strategy in which an online content provider could make customers out of its users. But two years later, iVillage has apparently changed its mind about the tumultuous world of retailing after dealing with the day-to-day annoyances of warehouses and product returns. The about-face in iVillage's strategy comes at a time when the company is ailing from a severely beaten stock value, high turnover among its executives and employees, and growing quarterly losses. In July the company sold iBaby to rival online baby-products retailer BabyGear.com for an undisclosed sum. IVillage has also announced plans to stop maintaining iMaternity.com and PlusBoutique.com, which will now be completely produced by Dan Howard Industries.

Cyberwomen everywhere

Potential investors, however, are hardly worried. Most believe that iVillage is a viable business - in fact, many admire its "go for broke" attitude. Venture capitalists are further emboldened now that other media heavyweights are hot on the cyber-woman tack. Hearst Corp. recently merged its HomeArts web site with Women.com; and Gerry Laybourne, the genius behind Nickelodeon/Nick at Nite, recently co-founded woman-centered Oxygen Media Inc. with Carsey-Werner and Oprah Winfrey's Harpo Entertainment. While these new e-ventures targeting women may bode well for the future of quality, woman-centric content on the Internet, they may also steal advertising dollars and patrons from iVillage. In 2000 iVillage hired ex-Lifetime TV chief Doug McCormick as its new president. McCormick hopes to duplicate his success at Lifetime in the online world.

Scandal at the top

Sad but true, behind the happy, helpful web site, life at iVillage is less than hunky-dory. Its turnover rate is notorious - even for an industry where job hopping is par for the course. According to The Wall Street Journal, industry recruiters say the company is known for having a "revolving door," to and add that its not uncommon for "people from an entire division" to show up looking for jobs. Moreover, a few ex-iVillagers have now set about airing the company's dirty laundry. In January 1999, a former executive filed a lawsuit against iVillage, contending that the company reneged on a promise to give him stock options. Soon after, two more defectors filed declarations alleging that they, too, had been cheated out of their stock options. Then, just days before its March 1999 IPO, the company's former CFO filed court documents accusing iVillage of various accounting-related transgressions. He also alleged that he was fired in a massive purge of men from the company's executive ranks. iVillage has settled the suits.

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