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August 26, 1999
Doing Pretty Well, Thank You
M J Shenoy
Who would think the New York City housing crunch could actually be a blessing?
Varsha Rao and Mariam Naficy, the co-founders and co-presidents of a hot, three-month-old on-line beauty care business, www.eve.com, met when Naficy was searching for a place in the Big Apple.
As luck would have it, a room in Rao's apartment opened up, and Naficy moved in. The two spent the next year toiling in the high-stress and long hours of high management and finance.
Rao, who has an MBA from Harvard Business School, was an engagement manager at McKinsey & Co while Naficy, who did her masters in business administration at Stanford University, was a financial analyst at Goldman Sachs & Co.
As busy professional women, they found it difficult to get to a department store to restock their favorite beauty products, and nearly impossible to check out the latest offerings from the smaller, "make-up artist" brands that were continually cropping up. Discovering they were not alone in their frustration, they thought of starting a web beauty care company.
They, of course, had to face a lot of opposition, initially. Some of their friends wondered whether women, used to be pampered at departmental stores' cosmetic divisions, would buy from a web company.
Rao, daughter of a stockbroker and a computer programmer, was not surprised that even her parents were concerned she was venturing into something very new. At one point, they asked her if she could manage the online business at the weekends.
The two friends felt that despite the pampering people received at departmental stores, navigating through the aisles and getting to the store itself was often fraught with irritation caused by traffic jams and other problems.
They also knew that women were not the only ones who felt frustrated by shopping at departmental stores. Many of their male friends spoke about being exhausted by the departmental store experiences. Rao and Naficy knew then that their web venture should cater to men too.
Apart from looking for an angel investor and fine-tuning the strategy, the two would-be partners wanted a name for their company that would click immediately.
Since every other woman they knew wanted the same "instant gratification" when it came to her cosmetics shopping, Rao and Naficy decided to find a name that transcends age and racial boundaries, a name that had personality. And so, Eve was born.
"We loved the name, but found out that the address -- www.eve.com -- already belonged to a six-year-old girl in Virginia," recalled Naficy. "So, we always thought of it as a name that we couldn't have." That was until they teamed with idealab!
After putting together a business prospectus, Rao and Naficy managed to meet Bill Gross, founder and chairman of idealab!, a venture capital firm with a strong track record for nurturing successful Internet commerce and entertainment companies.
After a meeting that lasted little more than an hour, Gross decided the idea was such a winner that he made the two women an offer the next day.
The rest, as they say, is cosmetic history. More than a dozen stories on www.eve.com have appeared in major publications, including in the San Jose Mercury. And the company that employs about 40 people works 24 hours and every day of the month.
eve.com, based in San Francisco, is the first company created exclusively to offer an array of upscale beauty products -- make up, face and body treatments, fragrances, bath and aromatherapy products and cosmetic tools -- on the web for the growing number of female Internet users Among the brands available are hip new lines like Urban Decay and Tony & Tina to classic lines like Calvin Klein and Givenchy. Vincent Longo's make-up line will also sell on the site.
Other beauty sites, such as www.bestbuys.com, www.cosmeticscounter.com, and www.drugstore.com, offer upscale and mass-market products. But industry experts point out this approach tends to alienate the prestige brands, which don't want their products associated with drugstore mascara and moisturizers.
The burgeoning on-line cosmetics and personal care market is projected to reach $ 1 billion by 2003. Some experts such as Jupiter Communications estimate that the online health and beauty market will grow by 250 per cent every year for the next five years, hitting $ 1.6 billion by 2002. That is faster than any other online category.
www.eve.com site also offers advice from expert make-up artists: "The Secret's Out" offers advice on skin care, fragrances, and makeup.
"These tips will give a glimpse into the techniques of the glamour gurus," Naficy said in an interview. "It will profile secrets of stylists who work with celebrities."
Vincent Longo, who has done makeup for Cindy Crawford and Minnie Driver, as well as for models appearing on the covers of Vogue and Elle. Among his tips: How to handle eyebrows, eye shadow, base, mascara, concealer, lips, powder, blush, bronzer, eyeliner and day into evening.
Naficy and Rao are constantly asked if it would work.
"People were worried that make-up could not be communicated on the web because people can't touch and feel it," Naficy said. "But technology provides people with high customer service by giving them 24-hour access to high quality expertise. And you don't have to wait in line at the make-up counter for someone to help you."
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