2nd Annual E-List

Bitstream Underground Inc.

Names/ages:Michael Koppelman, 34, and Charles Hermes, 34
Company/description: Bitstream Underground Inc. is a full-service ISP.
Based: Minneapolis
URL:www.bitstream.net
1999 sales: $2.1 million
2000 projections: $4 million to $5 million

Freaks and geeks: During a time when people were just discovering the Internet and AOL was still a virtual unknown, Bitstream Underground Inc., a bulletin board service (BBS) for music lovers, was conceived while its founders were working at Prince's Paisley Park Studios in Chanhassen, Minnesota, in 1994. Koppelman and Hermes, two long-haired, earring-wearing ex-musicians, wanted a cool BBS-one that wasn't "geeky and run by anal, technical dweebs."

Try a new bit: With a devoted fan base and the demand for dial-up Internet accounts increasing, Koppelman and Hermes acted fast to transform Bitstream into an ISP. Armed with a $55,000 loan from their local Riverside Bank and personal credit cards, the partners' out-of-pocket expenses totaled just $1,500 each, and that was all for computer equipment. One year later, in 1995, the ISP arm was born, and before Koppelman and Hermes knew it, prominent clients like Prism Studios Inc. and DentistWorld.com were walking through the doors, along with millions of dollars. "People take us seriously as a business even though we're still pretty much long-haired, earring-wearing ex-musicians," says Koppelman.

Technical difficulties: A lack of business and technical experience didn't get in the way for Koppelman and Hermes-they taught themselves. "We ordered a communications server, and I didn't even know what they looked like or what they did," says Koppelman. "There were immense technical challenges in that we had no clue how to even plug this stuff together."

Love what you do: "Running a business is different, and it's something you need to love in order to succeed at it," says Koppelman. "For us, it's been a long, hard and extremely exciting road. At this point, I think we do enjoy being involved with operating the company. We've been able to do what we love in the context of running our own business."

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This article was originally published in the July 2000 print edition of Entrepreneur with the headline: 2nd Annual E-List.

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