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Collegiate Case Study THE NATION’S NEWSPAPER Entrepreneurs The ability to identify a need in society that can be turned into a profitable business or service requires both creativity and a strong sense of business. Entrepreneurs have the ability to explore new ways to enter existing or new market segments. While corporate CEOs epitomizing greed, corruption, and obfuscation have dominated headlines for the past 18 months, another breed of leader has quietly emerged, combining creativity and ethics to establish new models of success. Based on a notion of "to be" rather than "to do", successful CEOs can translate corporate mission to galvanizing slogans, and adopt flexible and fluid management styles to foster individual creative efforts in the service of organizational goals. Several companies provide vivid depictions of this new economy leadership ethic, and are worthy of closer examination. This case study analyzes business models in this vein, reviewing companies that successfully balance customer satisfaction in a virtual marketplace, encourage personal commitment through innovative ownership schemes, and bridge the old economy and new. These studies focus on approaches to leadership and creativity from which students can derive essential principles and practices of businesses. Students will be poised to prosper in the 21st century as the new entrepreneurs. Reprinted with permission. All rights reserved. www.usatodaycollege.com BS2003-04 1 – Opinions based on access to capital, the right regulatory and tax environments and positive social and cultural attitudes Germany Japan USA 64% 11% 3% America is the best place for entrepreneurs The USA is considered the most entrepreneurial 1 country: USA TODAY Snapshots ® By Darryl Haralson and Frank Pompa, USA TODAY Source: Accenture survey of 880 senior executives, politicians, political advisers, academics, journalists, think tank analysts and researchers in 22 countries JetBlue soars on CEOs creativity By Chris Woodyard 7-9 EBay faithful expect loyalty in return By Jon Swartz 10-12 Some CEOs stand by their companies By Matt Krantz 4 Cover Story Card crafter uses creativity to carve out niche Case Study Expert Carol Majors Senior Director, Ewing Marion Kauffman Foundation Fewer entrepreneurs set up shop last year By Jim Hopkins 13 Minority women go it alone in starting their own businesses By Jim Hopkins 14 By Lorrie Grant USA TODAY NEW YORK -- Greeting-card maker Karen Mitchell-Raptakis lacks the financial might of institutions Hallmark and American Greetings but not the passion to be just as big. Raptakis, a book- publishing assis- tant by day, is a new voice in the $7.5-billion greet- ing-card business, specializing in the fast-growing eth- nic card genre. Karen & Co. Greeting Cards pub- lishes both humorous and sentimen- Ethnic-based products show off humor, sentiment Study: New company failure rate not so high By Jim Hopkins 5

20030521 Entrepreneurs

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CollegiateCase

Study

THE NATION’S NEWSPAPER

EntrepreneursThe ability to identify a need in society that can be turned into a profitablebusiness or service requires both creativity and a strong sense of business.Entrepreneurs have the ability to explore new ways to enter existing or newmarket segments.

While corporate CEOs epitomizing greed, corruption, and obfuscation havedominated headlines for the past 18 months, another breed of leader hasquietly emerged, combining creativity and ethics to establish new models ofsuccess. Based on a notion of "to be" rather than "to do", successful CEOs cantranslate corporate mission to galvanizing slogans, and adopt flexible andfluid management styles to foster individual creative efforts in the service oforganizational goals. Several companies provide vivid depictions of this neweconomy leadership ethic, and are worthy of closer examination. This casestudy analyzes business models in this vein, reviewing companies thatsuccessfully balance customer satisfaction in a virtual marketplace,encourage personal commitment through innovative ownership schemes,and bridge the old economy and new. These studies focus on approaches toleadership and creativity from which students can derive essential principlesand practices of businesses. Students will be poised to prosper in the 21stcentury as the new entrepreneurs.

Reprinted with permission. All rights reserved.

www.usatodaycollege.com

BS2003-04

1 – Opinions based on access to capital, the right regulatory andtax environments and positive social and cultural attitudes

Germany Japan USA

64%

11%3%

America is the bestplace for entrepreneursThe USA is considered the mostentrepreneurial1 country:

USA TODAY Snapshots®

By Darryl Haralson and Frank Pompa, USA TODAY

Source: Accenture survey of 880 senior executives, politicians, politicaladvisers, academics, journalists, think tank analysts and researchersin 22 countries

JetBlue soars on CEOscreativityBy Chris Woodyard 7-9

EBay faithful expectloyalty in returnBy Jon Swartz 10-12

Some CEOs stand by theircompanies

By Matt Krantz 4

Cover Story

Card crafter uses creativityto carve out niche

Case Study ExpertCarol MajorsSenior Director, Ewing MarionKauffman Foundation

Fewer entrepreneurs setup shop last yearBy Jim Hopkins 13

Minority women go italone in starting theirown businessesBy Jim Hopkins 14

By Lorrie GrantUSA TODAY

NEW YORK -- Greeting-card makerKaren Mitchell-Raptakis lacks thefinancial might of institutionsHallmark and American Greetingsbut not the passion to be just as big.

Raptakis, a book-publishing assis-tant by day, is anew voice in the$7.5-billion greet-ing-card business,specializing in thefast-growing eth-nic card genre.

Karen & Co. Greeting Cards pub-lishes both humorous and sentimen-

Ethnic-based productsshow off humor, sentiment

Study: New companyfailure rate not so highBy Jim Hopkins 5

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tal cards, with forthright messagessteeped in nostalgia and executed inbold colors.

"Every shut eye ain't sleep, everygood bye ain't gone," is the quip onthe cover of one with an image of anattentive little girl. The inside mes-sage: "No matter how old you get,don't forget what Mama taught you.Happy Birthday!"

Creating thecards is theeasy part, shesays. "Mymother andGreat Aunt Joused that pearlof wisdom as Iwas growingup, and I justsaw it on agreeting card."

After she has put words to the idea,illustrator Fred Harper helps captureher vision, which is often inspired byeveryday experiences.

The business side has been muchtougher going, however. As with anysmall business, the challenge of carv-ing a niche and gaining market shareis intense. That is magnified herebecause the goliaths -- Hallmark andAmerican Greetings -- have free-standing branded stores that areubiquitous, as well as exclusive sup-plier deals at other outlets. Also, theynow serve myriad niche categories inaddition to their more general cards.

But it is a big market, with about 7billion cards sold annually. About halfare seasonal and holiday cards. Therest are for everyday card-sending sit-uations, with birthdays the most pop-ular, the Greeting Card Associationsays.

Against that competitive backdrop,any niche player must be long on cre-ativity and business acumen to suc-ceed.

Raptakis, 46, shows off her creativi-ty with every card, but continues to

put in time to strengthen the busi-ness, taking courses in guerrilla mar-keting, licensing, branding, financialstrategy and more.

"I don't have any successful entre-preneurial role models in my family,"she says. She was raised in Brooklyn,N.Y.; her dad was a postal worker andher mom a clerical worker.

At one point, Raptakis was ready togive up on her fledgling business. "Iwas going through a patch of discour-agement not knowing where thisbusiness was going," she says.

A major distraction was comparingthe business with other businesses,where the successes seemed obvious."I was going through some strategysessions with other business owners,and everything with their businesseswas great. They were making money,and here I was, still with my day joband not making money."

Since that time two years ago, shehas regained her confidence by doingwhat comes naturally -- creatingcards.

One proved pivotal for her emotion-ally. It beat 1,100 other cards from160 companies worldwide for theprestigious Louie award, the indus-try's equivalent of the Oscar. It won inthe fast-growingFriendship/Encouragement categoryfor cards sold in 2000 and pricedabove $2.25.

The message for the award-winningcard, featuring abolitionist SojournerTruth on the cover, reflected her per-sonal struggle for recognition in anunforgiving business: "Your SpiritWill Not Be Broken." The card cele-brates the perseverance of those whostruggled in hopes that future genera-tions will have a smoother path.

AS SEEN IN USA TODAY MONEY SECTION, WEDNESDAY, MARCH 19, 2003, PAGE 7B

Reprinted with permission. All rights reserved. Page 2

Photos by Todd Plitt, USA TODAY

Her spirit will not be broken: Karen Mitchell-Raptakis has her greeting cards on display at theSacred Thoughts store in Jersey City. Cards include versions for Father's Day and for birthdays.

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"I send cards that I would like to getto encourage me, and 'Your SpiritWill Not Be Broken' is the card that Ineeded, so I had to create it," Raptakissays.

But the success has been bitter-sweet. Even with the industry'srecognition, she faces ongoing entre-preneurial hurdles:

v Financing. The business remainsself-funded. She says she'll have toshow her husband, Dimitrios, anaccountant, a sharper view of thenumbers behind her vision beforerisking a small-business loan.

v Staffing. Part-time help is beingconsidered to handle administrativetasks, including follow-up calls."Sometimes customers are too busyto call me to place an order. So I couldhave someone call them and ask,'How are the cards doing? Would youwant to place an order right now?' "

v Marketing. Sales are concentrat-ed along the East Coast, but she hasthe South in mind. "I would do verywell, because they have more of aspiritual base, and some of the cards Ihave would hit a nerve there,"Raptakis says.

v Venues. More than 80 retailerscarry the cards, but the mom-and-pop shops lack the foot traffic of larg-er retailers. "I need to change mymarketing strategy. I'm in a lot ofsmall stores that are struggling also."

The cachet of the Louie might helpin the long run. It establishes winnersas real greeting card publishers andbolsters their ability to get represen-tation by independent card salesagents.

It has for Pat Kane. Her year-oldSeattle-based Postcards from theMoon won the Louie as Patriotic card

and card of the year (for cards sold in2001 and priced above $2.25). "(Theaward) absolutely opened doors forus. We now have distribution in 34states and eastern Canada," Kanesays. "My husband, Gabe Palmer, con-tacted (sales) representatives recom-mended by stores that are our cus-tomers. Once the reps heard we wererecipients of card of the year, theywere willing to look at our stuff."

Kane's business now has nine peo-ple, enabling her to develop sevenmore lines.

Raptakis' business remains a one-woman shop without a steady salesrep, so she's had to learn to takerejection from buyers herself.

But her love for meaningful greet-ing cards has kept her going. Andshe's encouraged by statistics show-ing that of the 5.8 million small com-panies (fewer than 500 employees) inthe USA, those owned by minoritywomen are growing four times fasterthan all other companies, accordingto the Small Business Administration.

Raptakis remains committed tocards that cheer and give hope. Andshe dreams of the day when Karen &Co. Greeting Cards will be able tostretch with card lines that appeal tobroader audiences as well as calen-dars, journals and other stationeryproducts. Right now, her cards have aheavy bent toward "girlfriends."

"If you don't have that one girl-friend who you can tell things to orwho you know can lift you up, you'rein a bad state. I do think of my friendswhen I create cards: What will makesomebody laugh? What will theywant to hear in the way of encour-agement? What kind of card can Isend them just to say that I lovethem?"

Funding will play the biggest role inhow soon she can expand, but she'sarmed with her homemade brand ofoptimism.

"The achievements of a people arebased on the persistence and the per-severance of the individual," readsthe cover of a card with an image of arunner wearing No. 1 and crossing afinish line. The encouraging insidemessage: "I say, 'You go girl!' "

Reprinted with permission. All rights reserved. Page 3

AS SEEN IN USA TODAY MONEY SECTION, WEDNESDAY, MARCH 19, 2003, PAGE 7B

Her tips for entrepreneurs

v Absolutely love what you do,or it won't work. "This business isnot making money yet, but I amdetermined to give it my best shot.Greeting cards are my passion."

v Be comfortable with rejection."Other businesses don't take youseriously when you're starting out."

v Listen to the little voice inside."It will say, 'Go this way,' even whenthe people closest to you may besaying, 'Go the other way.'"

v Know the industry you're get-ting into. "I worked as a reception-ist in an alternative greeting cardcompany just so I could learn aboutthe industry. The pay wasn't great,but the experience was invaluable."

v Get objective opinions of yourproduct. "I would carry the cardprototypes with me all the time andwould show them to women in thenail salon or on the New York Citysubway while on my way to work.Their excitement about my productencouraged me to make it a realityor discard it."

Entrepreneur Case Study

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AS SEEN IN USA TODAY MONEY SECTION, WEDNESDAY, OCTOBER 22, 2002, PAGE 1B

Reprinted with permission. All rights reserved.

By Matt KrantzUSA TODAY

At a time when headlines are full of charges of executivegreed, some top brass are going to great lengths to showthey believe in their companies.

Rather than stealing from their companies or dumpingstock as investors get wiped out, these CEOs and chairmenare doing just the opposite, taking such rare steps as lend-ing their money to the struggling companies or buying thestock even as it plummets:

v Jeremy Barbera, CEO of MKTG Services, has bought themarketer's stock 12 times since the 2000 market peak --more than any other CEO of a struggling firm. He's part of arare breed. Only seven CEOs have repeatedly bought theirstock since 2000 after price declines of 20% or more, saysKevin Schwenger, insider-trading analyst at ThomsonFinancial.

But even faithful CEOs can get hammered. Barbera, whodeclined to comment, has watched MKTG's shares slide 94%to pennies a share. MKTG's auditors question whether it cancontinue operating.

v William "Trip" Hawkins, CEO of 3DO, lent the video-game maker $3 million to help it though rough times thathave driven its stock down 93%.

The six-month loan gives 3DO another gasp of air byallowing it to tap a $15 million credit line from GE Capital.GE Capital's loan was contingent on 3DO raising $4.6 mil-lion in additional funding.

To be sure, Hawkins will collect 9.5% interest. But 3DO,without Hawkins' loan, would have been in a tough finan-cial bind. "I'm putting my money where my mouth is. OtherCEOs typically want to use other people's money," Hawkinssays. "You can call me stupid, but you can't say I don't haveintegrity."

v Paul Lego, CEO of software maker Virage, has held ontoevery share of stock he owns as the stock plunged from

above $30 to less than $1. Hoping to comfort employees, hebought an additional 200,000 shares in August when thestock hit 72 cents a share, bringing his total holdings to 1.6million shares. "I believe in this company, and I put mymoney where my mouth is," Lego says.

v Dennis Gillings, chairman of Quintiles Transnational, isoffering $11.25 in cash for shares of the pharmaceutical-testing company he founded. That's a 35% premium to thestock's price before the offer was made -- at a time whenthe company is struggling and its share price is down 36%this year. Gillings and Quintiles declined to comment. Andthere's still controversy. Some investors have filed a securi-ties class-action lawsuit against the firm.

Jonathan Moreland, director of research at InsiderInsights,is encouraged that at least some executives are standing bytheir companies. "Wouldn't you rather put your money on acompany where executives are at least signaling they stilllike it?" he says.

Page 4

Buying all the way downSince the March 2000 market peak, only seven CEOs mademultiple purchases of their company's stock after theshares dropped 20% or more in price.

Executive CompanySteven Dodge American Tower Daniel Glassman Bradley PharmaceuticalsAndrew Filipowski Divine Donald Moorehead EarthCare Henry Fong Equitex Anthony Fant HEI Jeremy Barbera MKTG Services

Source: Thomson Financial

Execs bet on falling shares,offer loans to show support

Some CEOs stand by their companies

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67% of start-ups successful after four years in operation

By Jim HopkinsUSA TODAY

SAN FRANCISCO -- New companies don't fail as often --or as fast -- as thought.

Instead, 67% of new ventures are successful after fouryears, says a study that contradicts the widely held beliefthat 90% of start-ups fail in year one.

The study of 12,185 companies found that 17% werewrongly considered failures because they had closed.Instead, owners deemed them successful, and closed them

after retiring or sellingthem, says Brian Headd,a U.S. Small BusinessAdministration econo-mist. He says manywould-be entrepreneursare scared by the 90%failure number, and thatthe new research couldencourage would-beentrepreneurs at a criti-cal time.

Entrepreneurship,which leads to the smallbusinesses that createmost new jobs, is hitting

speed bumps. The share of all U.S. workers who are self-employed hit 50-year lows during much of last year.Venture capitalists have cut investments in start-ups sincethe technology bust and the stock market's swoon.Ventures most likely to survive begin with:

v More than $50,000 in capital. Many companies failbecause founders don't start with enough to coverexpenses while they build revenue. Ted Jordan, 42, setaside $50,000 to cover his salary and the cost of comput-ers, travel and other expenses when he started his com-puter consulting firm in 1998 in Cleveland. JordanTeamConsulting had $45,000 in annual revenue and was prof-itable last year.

v A college-educated owner. Education gives an entre-preneur more resources to keep a business going, Headdsays. Cecilia Chavez-Protas, 45, who worked for AT&T inhuman resources for 13 years, earned a business manage-ment degree so she would be better prepared to start acompany. That helped in 1998, when she accepted anAT&T buyout and started Competitive Edge Consulting inMesa, Ariz.

v A home office. Companies begun at home have lowerstart-up costs because the owner doesn't pay office rent.Also, such entrepreneurs likely enjoy working from home,so are more likely to keep a struggling business goinglonger.

Kim Rowley, 30, started an online shopping service ather home in Pierce, Neb., in 1999 because she wanted tobe closer to her four young children. No local employerwould let her telecommute in her 1,774-population town.Rowley's Shoppingbookmarks.com helps consumers finddiscounts on products from apparel to videos. It has$75,000 in annual revenue, and a new, potentially lucra-tive deal with Procter & Gamble.

AS SEEN IN USA TODAY MONEY SECTION, TUESDAY, FEBRUARY 18, 2003, PAGE 1B

Reprinted with permission. All rights reserved. Page 5

Study: New company failure rate not so high

Business success

By Marcy E. Mullins, USA TODAY

After four years, the percentage ofstart-ups that are:

Source: U.S. Small Business Administration

Successful50%

Successful, butsold or closed

17%

Unsuccessful, andsold or closed33%

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Entrepreneurship is intertwinedwith U.S. history. Indeed, patriotsPaul Revere and Ben Franklinwere small-business owners.Entrepreneurship gave a leg up tomillions of immigrants. And itcontinues to inspire U.S. workerstoday amid the corporateupheaval that is sending millionsof workers into the job market.As many as 800,000 businessventures -- possibly more -- arestarted annually in the USA.Those that survive and prosper

could become the next Microsoft or Wal-Mart -- hugeenterprises that employ hundreds of thousands of workersand create innovations that affect every American.

To chart this diverse subject, I often start with academicresearch -- then bring it to life with examples drawn fromthe real business world. In particular, I rely on a databaseof more than 2,000 small-company owners for the lateston trends.

Such research led me to two stories about:

v Minority female entrepreneurs, Oct. 22, 2002. I paya lot of attention to any trends in minority business own-ership because the number of such companies is growingfaster than all other firms. This story, based on data fromthe Center for Women's Business Research, noted: "Thestudy of 807 women paints one of the most detailed por-traits yet of the USA's 1.2 million minority female entre-preneurs.''

Among other interesting details, the study showed thatminority female entrepreneurs, more than white women,are likely to run their businesses by themselves. That hasimplications for their future business growth.

v Falling start-up rates, May 30, 2002. The fact thatjust 12% of adults took part in start-ups in 2001 vs. 17%the year before shows the dramatic impact of factors thatinclude terrorism and the shortage of venture capital.

It also reflects the pendulum's swing back from the crazyatmosphere of the late 1990s, when dot-com ventureswere being created without adequate business plans.

Jim Hopkins writes about entrepreneurship, venturecapital and other business news for USA TODAY's Moneysection. He has been a reporter and editor at Gannettnewspapers since 1987. He specializes in analyzing datausing spreadsheet, database management and other soft-ware tools.

Hopkins grew up in Providence, R.I., where he received abachelor's in English from Brown University.

Behind the Story: A Reporter's Notebook

Reprinted with permission. All rights reserved. Page 6

Jim HopkinsReporter, Money

Page 7: 20030521 Entrepreneurs

By Chris WoodyardUSA TODAY

NEW YORK -- Even as he talks about his passion -- the air-line he founded -- David Neeleman fidgets. He fingers theairport identity pass he wears around his neck. He plucks amodel airplane off the tabletop and scans its underbelly.Sometimes when you talk to him, his head seems else-where. "Out in space," he readily admits.

"Where do you go when you do that?" he recalls someoneasking. "I had some thought in my mind," he replied nebu-lously.

Far from lacking in mental acuity, Neeleman is CEO andthe mercurial driving force behind JetBlue, the discount air-line that's become one of the few shiny spots in a tarnishedindustry. He attributes his scatterbrained nature to atten-tion deficit disorder (ADD).

Neeleman, 42, was diag-nosed with ADD about threeyears ago after reading aboutit. Symptoms of ADD -- esti-mated to affect 4% to 6% of thepopulation -- can includebeing easily distracted, forget-fulness and restlessness.

Yet Neeleman views hishyperactivity as an asset. Hewon't take medication for fearhe might be robbed of the cre-ativity and energy propellingJetBlue to rapid growth

through intense customer service and innovations such as24 channels of live TV at every seat.

Neeleman's sometimes erratic approach to life is just oneof the quirks making him one of the fascinating leaders inan industry long known for larger-than-life characters.

Those who know him are often asked to draw compar-isons to such colorful figures as Southwest AirlinesChairman Herb Kelleher, a chain-smoking, whiskey- lovingprankster, or Continental's Gordon Bethune, a brash formernaval aviation mechanic who still swears like one.

But Neeleman is an original. He's a night owl who prowlsthe Internet for airline developments after his family goesto bed, phoning subordinates as late as 2 a.m. before catch-ing four or five hours of sleep.

He flies his own airline at least once a week, announcingover the intercom that he's aboard, then greeting all pas-sengers -- 162 on a full flight. An entrepreneur at heart, heuses cocktail napkins to scribble passengers' suggestions,which get attention as soon as the plane lands.

He's a father of nine who is so deeply religious that hecharters planes or buys blocks of seats to fly Mormon faith-ful and potential converts to church conventions.

He lacks the patience for hobbies, and he rarely watchestelevision or reads books other than scripture.

AS SEEN IN USA TODAY MONEY SECTION, TUESDAY, OCTOBER 8, 2002, PAGE 1B

JetBlue soars on CEO's creativity

Reprinted with permission. All rights reserved. Page 7

As rest of industry flounders,Neeleman's discount airline flies

Flying high: David Neeleman, playing airplane with 3-year-olddaughter Isabel, has used his hyperactivity to nourish the cre-ativity that could make JetBlue a start-up to be reckoned with.

By Leo Sorel for USA TODAY

"I don't care ifthey respect me.I could care less.I'm not in thisbusiness to gainrespect fromother airlineCEOs."

- David Neeleman,CEO of JetBlue

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"He's always intrigued me becausehe's a little off the beaten path, and Ican't always read him," says VickiNeeleman, his wife of 21 years.

Certainly, he doesn't make it easy.Some of Neeleman's employees com-pare him to nuclear fission. Whetherit's championing a crusade within thecompany -- his latest is the notion ofseparate lavatories for men andwoman on planes -- or scouting fornew routes, he bounces from issue toissue like a free neutron. "It's challeng-ing because he wants to be every-where all the time," says Tim Clayton,a JetBlue vice president. He's alwaysunloading ideas, "because if he doesn'tget it out now, he'll forget it."

One thing that Neeleman can focuson is JetBlue. That's one of the hall-marks of the disorder, he explains: theability to concentrate on one centralinterest. For him, it's airlines.

Neeleman is succeeding where oth-ers have failed. The 2-year-old airline

is adding 15 planes this year and hir-ing 1,000 workers at a time whenmajor airlines are slashing fleets andlaying off workers. Service to the 20thdestination, Las Vegas, starts Thursday.

While the industry expects to losemore than $6 billion this year, JetBlueearned $27.6 million in the first half of2002 on the strength of low operatingcosts and cheap fares. It has among thehighest load factors in the industry --more than 80% of seats filled com-pared with 72.3% for the industry inthe first eight months of the year.

Routines get him through

To keep his airline on top, Neelemanhas tried to inject order into his life,whether he's at the office near NewYork's Kennedy International Airportor home in suburban Connecticut.

From his wife to his executive staff,he surrounds himself with people whoare naturally organized.

He develops routines. He always putshis wallet and keys in the same placewhen he's at home. He wears a CasioDatabank watch, typing reminders ofideas or appointments.

He buys the watches four at a time,expecting them to either break or dis-appear. Once, Vicki Neeleman couldn'tfind her husband during a backyardbarbecue. He had driven away and"left the chicken to burn," she says. Hisexcuse: "Oh, I had to go buy a watch."

Just as he loses watches, he has trou-ble hanging on to just about every-thing. "If someone gives me a fancypen, it's gone in a day," he says.

Vicki smiles and shakes her head.She takes his quirks in stride. "Youcan't get mad at everything or you'd bemad at him all the time," she says.

In fact, David Neeleman thrives ondistraction. Every few minutes, hechecks the BlackBerry device strappedto his waist for new e-mails. He gets amessage whenever a plane leaves itsgate late. He wanders out of companymeetings whenever he gets bored,which is frequently, usually ending upin the marketing department for a fewminutes before going back. He loves toshop at Costco, a store swirling withactivity. He brings home so many bags,they fill the kitchen floor.

His father, Gary Neeleman, says hisson was restless even as a youth."David hated fishing," he says. "He did-n't have the patience. He would startfishing, and 2 minutes later, he isthrowing rocks in the pond."

Where it all began

Born in Sao Paulo, Brazil, where hisfather was a wire service correspon-dent, David Neeleman learned entre-preneurship as a boy while helping athis grandparents' grocery in Salt LakeCity.

AS SEEN IN USA TODAY MONEY SECTION, TUESDAY, OCTOBER 8, 2002, PAGE 1B

Reprinted with permission. All rights reserved. Page 8

CEO focuses on passion: JetBlue

All in the family: David and Vicki Neeleman hang out with six of their nine kids.Clockwise starting at bottom front: Vanessa, 9; David; Daniel, 14; Victoria, 12; Hannah,5; Isabel, 3; Vicki; and Seth, 7.

By Leo Sorel for USA TODAY

Entrepreneur Case Study

Page 9: 20030521 Entrepreneurs

He later returned to Brazil as aMormon missionary, baptizing morethan 200 converts and learning fluentPortuguese.

After dropping out of college,Neeleman became interested in the aircharter business. He teamed with atravel operator, June Morris, to createlow-cost Hawaii packages for Utahfamilies.

That led to the creation of Morris Air,a low-fare carrier that was bought bySouthwest in 1993. Neeleman netted$20 million in the deal. He went towork for Southwest but chafed undera structure that he perceived asthwarting his best ideas. Kelleher firedhim after five months.

Restricted by an agreement not tocompete in the USA for five years,Neeleman helped found a Canadiandiscount carrier, WestJet Airlines, anda ticketless reservation system, OpenSkies, later sold to Hewlett-Packard in1999 for $22 million.

He also says he dabbled in some badinvestments -- from medical devicesto pretzels. All the while, he markedtime until he could jump back into theairline business.

His vision: a better Southwest.

Like the Dallas-based discounter,JetBlue's fleet would be one type ofplane -- Airbus A-320s. And peoplewould buy their tickets on the Internetor from reservations agents. Toimprove the experience overSouthwest, JetBlue would offerassigned seating.

Also, JetBlue would be the only air-line to offer live television via satelliteat no charge. Having TV has proved sovaluable that JetBlue bought theprovider to protect its advantage overrivals.

Unlike other start-ups, JetBlue wouldbe one of the best financed ever. Atmost recent count, before it boughtthe television system company,JetBlue had $295 million on hand. Theairline didn't apply for federal loanguarantees like United, US Airwaysand other major airlines.

"He has deep convictions on how torun a business and give the customerquality," says GCW ConsultingPresident Morris Garfinkle, who work-swith the industry and knowsNeeleman.

The San Francisco venture-capitalfirm Weston Presidio took a 20% stakeas one of the original investors inJetBlue after Neeleman more thantripled the firm's investment profits inMorris Air in 14 months. "David wasthe king of execution," says Westonpartner Michael Lazarus, who becameJetBlue's chairman. Lazarus, who isJewish, says he jokingly promisedNeeleman he would become aMormon if his firm made back 10times its investment on JetBlue. "I'mgetting dangerously close," he says.

Utah Gov. Michael Leavitt callsNeeleman "a genius when it comes tomaking airlines work." Besides servingSalt Lake City, JetBlue has hired 750workers in Utah, most of them stay-at-home, $8-an-hour reservations takers.

Neeleman has an 8% stake in JetBlue,worth $117.6 million. He draws a$200,000 salary. But he's more thanwilling to give some of it back: He'smatching employee contributions to aworker welfare fund dollar-for-dollar.Yet although he has amassed a for-tune, he and his family remainremarkably humble. "I can't standsnobby people," he says.

He drives a silver 1999 GMC Yukonawash in shoes, cellphone cords, athree- quarters-empty bottle of

Snapple Prickly Pear, a few companyreports and Mormon literature, whichhe is quick to offer guests.

The seven Neeleman children athome, ages 3 through 16, bunk two ormore to a room. The family sold a12,000-square-foot house in favor ofone that's 8,000 square feet becauseVicki wanted one that's easier to clean.She's raising the kids without a nannyand says she hopes for a 10th child -- a"caboose," she says.

On a single Saturday earlier thismonth, the Neeleman clan collectivelybounced among four soccer games, afootball game, a track meet, a movie, abaptism and an interview.

Neeleman just made the cover ofForbes magazine and is being profiledby CBS' 60 Minutes II. But he doesn'tbelieve his fellow airline CEOs givehim a second thought.

"I think they think we're anotherstart-up. But I don't care if they respectme. I could care less. I'm not in thisbusiness to gain respect from otherairline CEOs," he says.

Sure enough, top executives at otherairlines didn't want to talk aboutNeeleman. But he has himself as hisown harshest critic. He says it's anoth-er hallmark of ADD, a constant fear offailure even in the face of clear suc-cess. He calls it "an inability to cele-brate."

Says Neeleman: "There's no end insight to the meltdown in the airlineindustry. To think we aren't affectedby those events would be naive." Butwith JetBlue flying ahead of the pack,everyone else seems to be celebrating.And Neeleman says he wouldn'tchange a thing. Even having ADD.

"If I could take a magic pill thatwould get rid of it, I wouldn't," he says.

Reprinted with permission. All rights reserved. Page 9

AS SEEN IN USA TODAY MONEY SECTION, TUESDAY, OCTOBER 8, 2002, PAGE 1B

Entrepreneur Case Study

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By Jon SwartzUSA TODAY

ANAHEIM, Calif. -- The Bubble Wrap Lady can't believeher good fortune. "Until I discovered eBay, I sat on mycouch, doing nothing," says Karen Young, 43, aCrawfordsville, Ind., housewife who has achieved eBayfame selling shipping materials on the auction site. "Thesite changed my life."

That's the kind of customer fervor the eBay Army --nearly 50 million strong -- has for the online auction site,which has pioneered a cultural and economic shift in howAmericans shop. They're so faithful that 5,500 of them --twice as many as expected -- filled eBay's first Star-Trek-like convention June 21-23. So faithful that 90% of themwon't consider doing business elsewhere. So faithful thatthey don't see themselves "bidding" for items, as much as"winning" them. And so smitten that they refer to MegWhitman, eBay's billionaire CEO, as simply "Meg." "Theseare innovation junkies -- like the people who used to fol-low the Grateful Dead around the country," says EugeneFram, marketing professor at the Rochester (N.Y.) Instituteof Technology.

They also have the kind of fierce customer loyalty rarelyseen in American business. The closest comparisons arethe Macintosh faithful of Apple Computer, sweet-toothed

fans of Ben & Jerry's icecream and Harley-Davidson's hog-wild bikers.

Brand experts say eBay,the Internet's most success-ful venture, could becomethe next Wal-Mart, a per-fect marketplace wheresupply meets demand inreal time.

But that's largely contin-gent on the continueddevotion of eBay's fans, andeBay is starting to feel somerelationship pangs. As itreaches out more to bigbusiness customers such as

IBM and Sears, the mom-and-pops that made eBay theplace to trade Beanie Babies and other collectibles are feel-ing a bit like jilted lovers.

"Our fear is eBay will become so wrapped up in corpo-rate sales, we'll be forgotten," says John Davidson, 45, ofLakeside, Calif., a Lost in Space collector.

"Look at the site: eBay Motors, Disney, Gateway, Dell.What about us?" At the conference, most booths weredominated by corporate names such as Microsoft and IBM."Where were the collectors? Why weren't there moreservices for smaller buyers?" asked art seller Linda Woods,33, of Valencia, Calif. "(The conference) was hokey andpoorly put together."

Earlier this year, eBay customers complained bitterly ine-mail messages and phone calls when eBay raised itscommission on goods sold. There was a similar outcrywhen eBay introduced a 5-cent fee to use its "Buy it now"feature.

A 'love-hate' relationship

Time for a therapist? Not yet, eBay analysts say. Butmanaging a rabid customer base is tricky business."Anytime you have a strong brand, you risk vulnerability,"says branding consultant David Aaker. "Expectations areso high that if you slip up, there's a danger of backlash.Look at Martha Stewart."

EBay faithful expect loyalty in return

Fan following: Meg Whitman, CEO of eBay, is swamped byautograph seekers at eBay's first convention in Anaheim, Calif.,on June 23. Hundreds waited in line to get her signature.

Photos by Susan Goldman for USA TODAY

AS SEEN IN USA TODAY MONEY SECTION, MONDAY, JULY 1, 2002, PAGE 1B

Corporate moves rattle some

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Dedicated: Clare "abuttonlady"Bazley shows buttons and ashirt bought on eBay.

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Shares of Martha Stewart LivingOmnimedia have tumbled 40% sincereports surfaced questioning the tim-ing of her sale of ImClone Systemsstock. Stewart has denied any wrong-doing. She is a close friend of SamWaksal, the former CEO of ImClonewho has been charged in an inside-trading case. For Stewart, the domes-tic doyenne whose main asset isimage, any indiscretion could alienatetrusting consumers, brand expertssay.

EBay's customer-relationship chal-lenges might be especially dauntingbecause of the company's origins.EBay collectors such as Davidson "feelthey built the business," says InaSteiner, editor of AuctionBytes.com,an online newsletter that followseBay. Those close ties, Steiner says,have fostered a "love-hate relation-ship."

Love was exactly what eBay founderPierre Omidyar, who started then-AuctionWeb in 1995, envisioned. Hewanted to "empower people tochange their lives," and the eBaysianphilosophy struck a chord with con-sumers. "Omidyar wanted his cornerof cyberspace to be a place wherepeople made real connections witheach other, and where a social con-tract prevailed," writes Adam Cohenin The Perfect Store: Inside eBay.

Despite some dissenters, that senseof community was evident at the con-ference. Hundreds waited in line forWhitman's autograph. Hundredsmore waited to spin a giant wheel towin free eBay caps, T-shirts, yo-yosand coolers.

Fans hugged Pinkliners, eBayemployees who moderate companybulletin boards. EBay trading cards,introduced June 21, are already a hotcommodity on the site. The devotees

came from everywhere, includingAustralia, Alaska and New York, toschmooze, swap tips and bow to theeBay altar.

"It's like a reunion of people you'venever met," says Clare "abuttonlady"Bazley, 43, an avid button collectorfrom Anaheim, who met other"posters" she frequently exchangesmessages with on eBay bulletinboards.

EBay has been so effective in devel-oping a sense of community that itsaid June 24 that it would offer eBayPowerSellers, who sell more than$1,000 a month on the site, grouphealth insurance.

EBay also points out that, despite itspush for corporate customers, mom-and- pop sellers account for morethan 90% of its revenue -- and thatwon't dip below 80% for several years.Non-corporate sellers are the compa-ny's "bread and butter," says BillCobb, eBay's senior vice president ofglobal marketing. "We can never losetouch with them."

Making the magic happen

Better not. Frenzied customers notonly boost sales with purchases butalso preach the benefits of theirfavorite brands to others. "Fringe buy-ers come and go, but these people arelike an extension of the companysales force," says Aaker.

He and others note that customersare fiercely loyal to brands that areconsistently superior in quality, dis-tinctly different and let users expresstheir values and interest.

While Harley-Davidson motorcyclesappeal to the macho mores of its

Entrepreneur Case Study

Some suspicious of big business feelersAS SEEN IN USA TODAY MONEY SECTION, MONDAY, JULY 1, 2002, PAGE 1B

Fans: Sisters Teri, left, and Lori Gof stand near characters modeled on eBay founder PierreOmidyar and CEO Meg Whitman. The sisters attended an eBay convention in June.

Reprinted with permission. All rights reserved. Page 11

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users, Apple, Volkswagen, VirginAtlantic Airways and Saturn resonatewith counterculture consumers. Themagic of eBay: It's where buyers andsellers come together to forge dealsand friendships. "It's the immediacyof a one-on- one relationship that youcan't get from a big, impersonal cor-poration," says Marsha Collier, authorof eBay for Dummies.

What's more, eBay's appeal drawsfrequent comparisons with Wal-Mart."Think Middle America, Ohio," sayseBay Chief Financial Officer RajivDutta. "There is a strong sense ofentrepreneurial spirit and small-townvalues." But while Wal-Mart typifiestraditional retailing with 3,200 stores,eBay is a virtual global marketplacewhere customers can buy and sellalmost anything that Wal- Mart offers-- and much more.

So far, so good

Such attributes have helped pro-duce the Internet's most successfulcompany. EBay users exchanged 170million items worth $9.3 billion lastyear. (Kmart's 2001 revenue was$36.2 billion.)

It shows no signs of slowing. First-quarter net income more than dou-bled, to $47.6 million, on revenuethat surged 59%. At a time whenmany companies are lowering expec-tations for the year, EBay is raisingthem.

This year, in addition to theantiques, baseball cards and otheritems routinely sold on eBay, itexpects to sell $2 billion worth ofused cars and $1 billion worth ofcomputers. Coming next: real estate,industrial equipment and event tick-ets.

Analysts say there's no end to thenumber and type of goods eBay cansell, and they say the company is bet-ter managed now than ever. So far,too, eBay has successfully handledseveral growth challenges: auctionscams have been limited and Website outages have been reduced.

"It's the future of global economicdemocracy," says Leland Harden, co-author of The Auction-App, whichexplores the nation's fixation withauction Web sites. The company'sstock, meanwhile, is holding up welldespite a high-tech downturn. The

market value of the 6-year-old com-pany is $17.4 billion, about two-thirdsthat of 99-year-old Ford Motor.

"They continue to perform at anincredibly high level," says DerekBrown, a WR Hambrecht analyst."The 'e' in eBay stands for execution."It could also stand for excitement.While some balk at eBay's changes,about 50,000 new customers hop onthe site every day.

And some, like the Bubble WrapLady, continue to find a higher pur-pose. Teri Goff, 44, a bookkeeper fromTustin, Calif. attended the conventionhoping to learn how to prosper oneBay selling movie posters and Disneytrading pins. "This could be a life-altering experience," she said.

Entrepreneur Case StudyAS SEEN IN USA TODAY MONEY SECTION, MONDAY, JULY 1, 2002, PAGE 1B

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By Jim HopkinsUSA TODAY

SAN FRANCISCO -- U.S. entrepreneurship hit a bump lastyear amid the recession and terrorist attacks.

Just 12% of adults took part in start-ups vs. 17% the yearbefore, says a recent study of 3,000 adults by BabsonCollege and the Kauffman Center for EntrepreneurialLeadership. Sept. 11 and the weak economic recovery willdepress start-up rates for the near future, the study'sauthors say. That hurts because start-ups create jobs.

Experts say entrepreneurship is falling because of shiftsin:

v Priorities. Would-be entrepreneurs are taking fewerrisks while focusing on family and personal priorities.

Plumbing contractor Kelly Hall, 54, and his business-con-sultant wife, Tamara, are delaying the start of a companythat will sell a device to keep pipes from freezing. AfterSept. 11, the Halls, who live in Bozeman, Mont., decided tospend more time with family, including their new grand-child.

Already, the Halls work a combined 100 hours a week. Anew business would add at least 30 more. "Relationshipsmatter more," says Tamara, 52.

v Opportunities. Start-up financing, especially fromventure capitalists, dried up. And corporations cut spend-ing, making it harder for new companies to grow. Butmore people will start companies this year, predictsKauffman researcher Larry Cox. That is because they arelosing jobs and can't find new ones.

Margaret Kulpa of Daytona Beach, Fla., launched her soft-ware consulting firm in January after quitting a job thatwas about to be eliminated. Kulpa, 50, concedes that a bet-ter time to start would have been the late 1990s, whencorporate tech spending boomed. Kulpa will ride out theeconomic recovery by dipping into savings and by work-ing from home.

Last year's drop in entrepreneurship may be an anomalycaused by Sept. 11 and the tech-bubble bust, researcherssay. Historically, entrepreneurship rises in recessionsbecause people leave companies to take advantage oflower start-up costs. That is still happening, albeit at alower rate.

Shelley Lazar started SLO Limited, a music services com-pany, two months ago in San Francisco. Office rents areabout half what they were last year. Lazar helps PaulMcCartney, the Rolling Stones and other celebrities coordi-nate ticket sales. Despite the challenge of starting a firm inslow times, she likes being her own boss. Plus, there areother rewards: McCartney sang Happy Birthday to herwhen she turned 53.

Fewer entrepreneurs set up shop last yearAS SEEN IN USA TODAY MONEY SECTION, THURSDAY, MAY 30, 2002, PAGE 3B

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Reprinted with permission. All rights reserved. Page 14

By Jim HopkinsUSA TODAY

SAN FRANCISCO -- It's lonely at the top -- especially forminority female business owners, says a major study outtoday.

The study of 807 womenpaints one of the mostdetailed portraits yet of theUSA's 1.2 million minorityfemale entrepreneurs. Thenumber of such companies isgrowing four times faster thanall U.S. businesses, makingthem a major source of futureeconomic growth.

One highlight of the surveyis that minority women aremore likely than whitewomen to start and run busi-

nesses by themselves. Their goals are often altruistic, suchas serving their community. And many have more troublethan white women getting financing, says the study by theCenter for Women's Business Research.

Still, the top issues for female business owners -- hiring,boosting revenue and finding capital -- are largely thesame regardless of race or ethnicity, says the center. Thoseissues mirror the concerns of all small-business owners.

But minority women often differ from other businessowners in how they manage, and in what drives them tostart companies, the study says. Corporations want tolearn these differences so they can better target theirproducts and services, says Patti Ross, IBM's executive incharge of selling to female-owned firms. IBM, Wells Fargoand other big companies want to tap the market becauseof:

v Faster growth. Although minority women own just5% of the USA's 22 million companies, their fast growth isaccelerating. The number of such companies grew fourtimes the U.S. average in 1997-2002 vs. three times theaverage in 1987-1996.

v Viability. African-American and Hispanic women aremore likely now than in the past to start their companiesas full-time ventures. That's another sign that morewomen are treating start-ups as serious ventures thatcould grow -- adding jobs and expenditures on suchthings as computers and banking services.

The differences between minority and white businessowners are especially pronounced among African-American women, who own more than 365,000 firms. Forexample, 72% of black women start or buy their businesseswithout a partner, vs. 62% of white women, the study says.

They also are more likely to saythey have altruistic business goals,such as serving their community orbeing a role model. Wanda Stephens,44, started her computer trainingfirm near Cleveland partly becauseshe wants to schedule her dayaround Bible study and work shedoes for her husband, a minister.

What's more, 27% of African-American women cite financingproblems, vs. 14% of white women. Black women may citemore obstacles because they have less experience withlenders or may suffer more overt discrimination, saysPatricia Greene, an entrepreneurship professor at theUniversity of Missouri.

Minority women go it alone in starting theirown businesses

AS SEEN IN USA TODAY MONEY SECTION, TUESDAY, OCTOBER 22, 2002, PAGE 3B

By Quin Tian, USA TODAY

Women Inc.

Source: Center for Women’sBusiness Research

The number ofcompanies owned byminority women isgrowing four times fasterthan the number of allU.S. businesses. Here is abreakdown of owners:

Hispanic

AfricanAmerican

AsianNative

American

470,344

365,110

358,503

77,483

Wanda Stephens

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For more information, log on to www.usatodaycollege.com

1. What are the advantages and disadvantages, for a company, of CEOs usingtheir own money to purchase declining stocks or to make loans to theircompanies? What are the potential ethical ramifications of such actions? Inyour opinion, are these CEOs demonstrating qualities of leadership? What arethose qualities?

2. Discuss leadership attributes the ideal entrepreneur would possess. The idealCEO? Are the attributes for the two identical? Why or why not?

3. Both JetBlue and eBay could be described as entrepreneurial companies. Whataspects of the ventures contribute to their entrepreneurial nature? How are thetwo companies similar? How are they different?

4. What factors should a company consider when weighing the costs and benefitsof growth vs. brand identification and customer loyalty?

5. Develop a list of personal characteristics you believe entrepreneursdemonstrate. Discuss whether these characteristics are unique to entrepreneurs,and if so, why.

6. Brainstorm strategies Karen Mitchell-Raptakis could pursue to increase hershare of the greeting card market. Identify three strategies that you feel would bemost successful and describe them.

7. Discuss the factors contributing to the success of start-ups. Which factor doyou consider to be the most important, and why? What are other factors you feelmight help start-up companies achieve success?

For discussion Future implications

1. Why are increasing numbers ofminorities and women starting theirown businesses? Do you predict thistrend will continue, or not? Why?

2. Will the war with Iraq have animpact on the number of businessstart-ups? What will that impact be?

3. What do entrepreneurs contributeto society, and to the communities inwhich their businesses are located?

Page 15

About The ExpertCarol Majors is a teaching and research fellow and Senior Director at the Ewing Marion Kauffman Foundation. She has beenwith the Kauffman Foundation since March 1, 1994. She works in the Children and Youth programs area. The Children andYouth area's focus is entrepreneurship education for individuals from kindergarten through grade 12. Carol's specificresponsibilities include contributing to the development of Kauffman Center initiatives, educator training inentrepreneurship education programs, managing the publishing of curriculum materials, and mentoring and follow-up inprogram implementation.

Programs with which Carol has been involved are the Mini-Societyâ for elementary age children; The New YouthEntrepreneur curriculum for students in eighth through tenth grades; the EntrePrep program for high school students; and the Mother andDaughter Entrepreneurs In Teams (MADE-IT) program for teams of 7th/8th grade girls and their mothers. Each of these curricula/programs isdesigned to impart age-appropriate knowledge, skills, and experiences to enable young people to consider entrepreneurship as a viableoption for themselves.

Prior to joining the Foundation, Carol taught at Rockhurst College and at the University of Missouri-Columbia, where she served as director ofthe center for economic education. She also has taught at the elementary, middle, and high school levels.

Additional resourcesEwing Marion Kauffman Foundation (http://www.emkf.org)

The Auction-App(http://books.mcgraw-hill.com/cgi-bin/pbg/0071387358.html)

AuctionBytes.com (http://www.auctionbytes.com)

EBay (http://www.ebay.com)

Harvard Business School (http://www.hbs.edu/)

Hesselbein on Leadership (http://www.josseybass.com/cda/product/0078796392500.html)

InsiderInsights (http://www.insiderinsights.com/)

JetBlue (http://www.jetblue.com/)

Peter F. Drucker Graduate School for Management at ClaremontGraduate University

http://drucker.cgu.edu/