Forget the bottom line. For dot.coms struggling to make a name for themselves, it's...Party Time!
By Silvia Sansoni

September 6 , 1999

Rufus K. Griscom, Jr. knows how to get New York's Silicon Alley buzzing. At a recent party for his erotic-fiction site Nerve.com, the 400 revelers who showed up were invited to pose naked for a photographer behind a screen. After signing a waiver, about 50 of them either stripped or struck erotic poses—which they, and other cyberoglers, could soberly appraise the next day on Nerve.com's Web site.

La dolce vita, Web-style. Internet stocks are off 50% since April and Cnet and Amazon.com recently pushed back their intended breakeven dates. So Net startups are boogying the night away. In an industry where perception matters more than moneymaking, a party vibe gets you buyers, venture money and new employees.

"You want to announce to the world that you've arrived, you have funding, you own the space—even if you're a six-month startup without a product," says Josh G. Silverman, chief executive of Evite, a San Mateo, California Web-based event planner.

Silverman recently threw a big coming-out party for Evite at San Francisco hot spot Bimbos, where 900 merrymakers gambled, danced, smoked hand-rolled cigars and practiced their gold swings in an enclosed area. Total cost: $70,000, a good part of Evite's 1998 revenues.

Former CNN anchorman Lou Dobbs stepped onto a different kind of set last month: a make-believe planet Mars (complete with red lava lights and faux red rock walls) in a Times Square theme restaurant. It was the launch pad for Dobbs' new Internet venture, space.com. Nibbling on "astronaut ice cream" and french fries, a VIP crowd—including former NASA astronaut Sally Ride, Loral Space boss Bernard Schwartz, PaineWebber boss Donald Marron and money men from the Rockefeller family's venture capital arm, Venrock Associates added star power. Cost: at least $35,000.

Space.com has no advertisers, ozone-thin content and its on-line store sells—no, not space suits—coffee mugs and t-shirts. What exactly was Dobbs celebrating?

"In a medium where all people know is your URL, it's our strategy to make sure we get the most attention early on," says space.com President Rich Zahradnik.

Some parties are recruiting events. Craig Kanarick, cofounder of the digital consulting firm Razorfish, holds his on May Day. This year's attracted 3,000 people to a Manhattan warehouse where female contortionists performed on beds of nails, and tattoo and balloon artists plied their trades. Kanarick claims he recruited a new director of marketing and vice president of R&D with this silliness.

"It's money down the drain," says Shelley Harrison, a San Francisco-based marketing consultant who helps launch Internet and software startups. Harrison estimates that parties cost $100 to $200 per person and yield little more than "an ego boost for the founders."

Less of a drain on company finances, and a fixture of Bay Area cybersocializing, is DrinkExchange, started by three employees of ad-banner company LinkExchange, recently bought by Microsoft. They applied their business model (host two banners on your site and get one free on some other site) to their own DrinkExchange get-togethers: Buy drinks for two strangers and hope someone buys you one.

DrinkExchange is taking root across the county, with sponsors like Oracle and CBS MarketWatch. What did the original imbibers get out of it? "It raises your name value in the Valley," says creator Michael Bayle. "I have met chief executives who I can call on when I decide to leave Microsoft."

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