Have you heard of Blue Mountain Cards? Back in the 90’s there was a huge rush of companies trying to provide online ecard services. I’m not sure exactly how they built a business model on the idea of giving away a free ecard, but they did. Business models based on advertising revenue were quite frequent back then. This is a difference with today’s focus on real revenue. However, with web 2.0, you could argue that it’s started all over again.
The ecard space is a funny one. This is the space that is eating the lunch from the old paper greeting card space that’s been around forever and a day. It seems like the classic case of doing something through technology that was previously manual. But I don’t think it’s that simple. An ecard is not the same thing as a paper card. Paper cards come from a store and require you to mail them. An ecard comes from a company like Blue Mountain Cards and is completely electronic. In this way, it’s a real product transition. So in essence, the technology is really impacted the very product. You see this also in pcs, telephones, tvs and other electronic products.
How exactly did blue mountain cards dig out of this hole? First, Blue Mountain Cards had a big lead going into the game. They had a good plan. It seems like the executives at Blue Mountain Cards new they were onto something big, but that it wouldn’t last. So Blue Mountain Cards management decided to sell the company while everything was still red-hot. What a move that was.. I’ll bet many people wish they had that type of timing.
How is that in 2008 Blue Mountain Cards is still a going concern? You could argue that the management team at Blue Mountain Cards were the luckiest people on earth to have gotten such a valuation at such a time when that was seen as appropriate. However, these were experience people who were also making a serious move in a serious industry. This is not a small business. Flawed business model or not, Blue Mountain Cards made a big dent in a market worth billions. I am betting that this is why they are still around today. They built a brand and have a name worth something. The part this is far from any text book case study is how they exited at the height of the crazy valuations. We should all be so lucky in our careers.