Jason Olim - The CDnow story: rags to riches on the Internet
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Learn how CDnow founders Jason Olim and Matthew Olim turned a small investment into a big business on the Internet, beating MCI, Blockbuster and Tower Records. Readers will also learn the tricks of the trade from these two successful Internet entrepreneurs, and discover how to apply the techniques to their own businesses.
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"CDnowBest Online Store. Far superior to even the largest Tower; better prices than most record stores; and tons of band trivia, record reviews, and online clips..." Entertainment Weekly
"Rolling Stone readers feel the music through words and pictures. We enhanced that experience when we launched the Rolling Stone Network, and we've now completed it by partnering with CDnow." Jann S. Wenner Editor in Chief and Publisher of Rolling Stone Magazine
"The CDnow store is one of the best thought out and implemented stores on the Web. It's that simple." Sell It On the Web
"We are continually working to deliver the best possible experiences both on-air and online. We recognize CDnow as the leading online music retailer whose focus is building the best possible store for its customers." Matt Farber Senior Vice President, Programming Enterprises, MTV and VH1, announcing the CDnow/MTV partnership
"CDnowThe Best. Four Stars out of Four." Yahoo! Internet Life
"Being first to execute a concept online doesn't guarantee success. It helps if you're obsessed with being the best. For Jason Olim, the desire to claim ownership of music retailing online began in February 1994.... Today, Olim's company, CDnow, employs 90 people, has 200,000 customers, and receives 1.5 million visitors a month." Internet World, December 1997
Page ii
"CDnow was up and running in August 1994. Soon after, the World Wide Web gave it a boost. CDnow posted $387 in revenue in its first month of operation. By January 1995, sales had risen to $100,000. For 1996 the company recorded $6 million in revenues, and Olim, now 27, says he expects that figure to triple this year as he broadens his offerings." Forbes, November 1997
"What does it take to build a company from nothing to $6.3 million in revenues in three years? Apparently, a lack of Miles Davis." Philadelphia Magazine, October 1997
"The largest retail store in the world has room for only 100,000 titles. By contrast, the on-line store CDnow Inc. lists 200,000 titles." International Herald Tribune, January 1998
"The twins, now worth more than $70 million combined, four years ago were operating the company out of the basement of their parents' house." Inter@ctive Week
"CDnow is a music lover's paradise." c|net
"Web Music Sales Expected to Soar: Report Predicts $1.6 Billion in Revenue by 2002. CDnow leads all other electronic retailers of music with a 33% market share of 1996 worldwide online sales." Billboard, June 1997
Page iii
The CDnow Story:
Rags to Riches on the Internet
By Jason Olim, with Matthew Olim and Peter Kent
Page iv
THE CDNOW STORY: RAGSTO RICHES ON THE INTERNET Copyright 1998 Jason Olim, Matthew Olim, Peter Kent
All rights reserved. Printed in the United States of America. No part of this book may be used or reproduced in any form or by any method, or stored in an electronic storage system, without prior written permission of the publisher except in the case of brief quotations in critical articles and reviews. Copying any part of this book for any purpose other than your own personal use is a violation of United States copyright law.
SAN#: 299-4550 Top Floor Publishing P.O. Box 260072 Lakewood, CO 80226
Feedback to the author: feedback@topfloor.com Sales information: sales@topfloor.com The Top Floor Publishing Web Site: http://TopFloor.com/ Cover Design by Doyle Communications Book Design by Magnolia Studio
Library of Congress Catalog Card Number: 98-86474
ISBN: 0-9661032-6-2
This book is sold as is, without warranty of any kind, either express or implied, respecting the contents of this book, including but not limited to implied warranties for the books quality, performance, merchantability, or fitness for any purpose. Neither the author nor Top Floor Publishing and its dealers and distributors shall be liable to the purchaser or any other person or entity with respect to liability, loss, or damage caused or alleged to have been caused directly or indirectly by this book.
00 99 98 6 5 4 3 2 1
Trademark and service mark terms used in this book are the property of the trademark holders. Use of a term in this book should not be regarded as affecting the validity of any trademark or service mark.
Page v
To our parents for supporting us and believing in the business, and to all of our employees past and present for their efforts in helping to build a better music store.
Page vi
About the Authors
Jason and Matthew Olim are the founders of CDnow, the world's largest online music store ( http://www.cdnow.com/ ), based in Fort Washington, Pennsylvania. Jason has a degree in computer science from Brown University in Providence, Rhode Island. Matthew has a degree in astronomy from Columbia University in New York City.
Starting from their parents' basement in 1994, these twin brothers built an organization that would make $16 million in sales in 1997, one-third of the online music business, with 1998's sales projected by industry analysts to be around 60 million. CDnow is twice the size of their largest competitor. The Olim twins are 28 years old.
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Peter Kent is the author of 36 business and computer books. His work has appeared in a variety of publications, from the
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