Dot Bomb

The Book of the Week is “Dot Bomb” by J. David Kuo, published in 2001. This ebook details the business dealings and the ensuing suspenseful power struggle at a dot-com company called Value America between 1996 and 2001.

The online retailer’s intended brand image was to boast maximum selection of merchandise shipped directly from sellers. This delivery-on-demand arrangement allowed the company to remain inventory-free, and thus minimize overhead costs. However, in reality, it needed to use resellers for many of the supposedly infinite products it sold.

Value America’s founder and leader, Craig Winn, was a charming megalomaniac who had grand plans to partner with various major corporations in order to attract investors and make the company worthy of an IPO. Unfortunately, Winn had planned to sell stock to the public just after the peak of the dot-com boom, when brokerages’ confidence in internet companies had started to wane.

After Value America went public, Goldman Sachs issued a report that Amazon.com was the internet retailer with the highest potential for success because it had high sales margins on its then-merchandise consisting only of books; a $30 billion valuation was not out of the realm of possiblity. Goldman went on to say Value America had the worst prospects, with sales margins of 1% and runaway costs. It would have to achieve revenues of billions of dollars in order to make any money.

Toward the end of the story, the author realized “Despite the hype, headlines, and hysteria, this was just a gold rush we were in… a lot of us were kin to those poor, freezing fools in Alaska who had staked everything on turning up a glittering chunk of gold.”

Read the book to learn the fate of the author, his family and the other Value America employees with dollar signs in their eyeballs.

God Is My Broker

The Book of the Week is “God Is My Broker” by Brother Ty, with Christopher Buckley and John Tierney.  It is a very funny satire.  The story starts with a man who made sufficient money on “Wall Street” to retire at a young age.  However, a mid-life crisis caused him to try the lifestyle of a Trappist Monk.

While swearing off material possessions at the monastery, “Brother Ty” still had the urge to gamble.  So he let a line of text in a religious tract dictate his course of action in the stock market.   The way Brother Ty interpreted the text turned out to be contrarian to most other traders’ advice and actions, but turned out to be extremely lucrative for him.

The humor of this book emerges when the monastery and the monastery’s abbot are revealed to be just as dishonest as Wall Street.   The monastery raised money through selling wine that was falsely advertised, and the abbot built himself an entertainment center with the ill-gotten gains. Read the book to vicariously experience the hilarity that ensues.