Virgin Biznet - the pioneering cloud-based e-commerce platform that kick-started SAAS e-commerce in the UK

It’s one of the most creatively prolific periods of my career - one with a long-lasting legacy both to me personally as an e-commerce innovator and for the industry as a whole.

Virgin Biznet -?leading edge… no! bleeding edge,?so read on…

Part 1

Part 1 of 4

Its innovation still influences us today.

Getting businesses to trade online - sounds simple today, but, this was the ambition at a time when there were only 1.7M people in the UK on the internet, mainly through a dial-up connection, few had ever bought something online, payment solutions were in their infancy, and delivery solutions non-existent.

In the beginning...

Cloud-based applications, ecommerce and SAAS are commonplace terms and concepts today. If we want to start or grow a business, most of us lean in to the internet as our channel of choice, sign up to a subscription-based service such as Squarespace or WordPress to build our websites, and later adopt platforms such as Shopify or BigCommerce if we want to trade online. We take for granted that our customers would be part of a global mix of billions of people, all connected to the internet at speed far faster than even the first broadband, let alone dial-up, even whilst mobile. And if we want to educate ourselves on the latest statistics or management techniques, we simply ‘Google’ them.

How far we have come in 25 years! Because it was 25 years ago that a pioneering service was launched which aimed to do what we take for granted today.?

Virgin Biznet (Virginbiz.net) was launched on October 14th 1999.

The idea was to enable small businesses to understand, build, trade and win using this ‘new’ concept called the internet - and, of course, building on the entrepreneurial and ‘customer champion’ foundations that defined the brand of Richard Branson

At the time Virgin was the most revered brand amongst men and 4th amongst women. If one could use the internet to level the playing field between large corporates - who had all the resource and internal knowledge to dominate a market - and small businesses, then these specialist providers would flourish. As consumers, we would gain from the cost, choice and convenience benefits by buying online, and that people at the time were starting to discover.

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To achieve this, a web portal needed to be built which would act as not only a one-stop business information resource - covering management, financial, legal, marketing and people advice - but also a full end-to-end platform to facilitate the adoption of the internet as a trading platform - i.e. to provide the ability to connect to the internet (with only 1.7M people connected at the time mainly through dial-up in the UK, most hadn’t even got an internet connection, let alone email, and broadband for all was just a pipe dream), build a website - including a fully transactional webshop - market themselves and enhance their customer experience to ultimately reach the goal of success online.

Furthermore, given that cash is always an issue for small businesses, these e-commerce services would have to be offered on a monthly subscription basis...

Today, we call this SAAS (Software-as-a-Service), but then we called this new concept ‘subscription-based software’.

Whilst this meant the financial barriers to uptake were low, many potential clients simply couldn’t understand why they didn’t get a beautifully shrink-wrapped box containing disks and a manual inside… and couldn’t believe they would always have the latest versions of our software without the need to both perform a physical software update or pay a support fee (today we take this for granted as Apps seem to update everyday!).

?This concept was groundbreaking at a time when:

• Most websites weren’t transactional - they were pure information sites, so generating revenue was mainly through advertising and why the phrase ‘Content is King’ was widely adopted - good content meant more visitors (eyeballs) which meant higher advertising revenue. Even here, online advertising was in its infancy, with charges made on the number of page impressions, rather than measurable click-throughs (CTR), let alone the concept of cost per click (CPC) or cost per acquisition (CPA) commonplace (or even considered passé) by todays’ standards.)
• Technically, websites were an ‘on-prem’ build, then uploaded to a ‘webspace’. To build a transactional website within the cloud was groundbreaking - the benefits being that all the clever software operations (‘server-side includes’) were always operational, which also meant non-technical users could build even the most complex websites. Also, systems were ‘monolithic’ in architecture (i.e. software built as a single block of code, rather than small operations that could be called during operation.) This meant there were few platforms with open APIs (web-calls - an instruction within a URL string - were as advanced as it got) and splitting platforms into web ‘front-end’ / ‘back-end’? was unheard of, let alone the concept of micro-services.
• Shoppers were weary of making payments online (…submit your credit card details and wait a week to get your goods!) - we had started to hear about a new concept from the West Coast called Paypalwhich was claiming ‘Got an email? Get sent money’!
• Online search was dominated by Alta Vista, but being challenged by Yahoo and a few specialist alternatives such as Ask Jeeves …and some new kid on the block called Google.
• And remember the browser wars between Internet Explorer and Netscape or the headache of having to install the Flash player to display animated graphics…

So how did it all start?

Virgin Biznet was an initiative born out of Virgin.net which was at the time UK’s most visited website as it featured music, news, information and, quite frankly, everything that was ‘cool’ at the time!

Unlike today, back then, the internet was an entity that most could only access via a desk-top computer and, therefore, considered to be a purely an IT-based discipline. So, it’s not surprising that the initial idea, originally named ‘Virgin Business Net’, was successfully pitched to Virgin Management (the holding company that managed the Virgin brand and its associated investments based in Holland Park, London) by Virgin.net’s Network Manager, George A Danos in October 1998 - a year before the company was eventually launched.

As a startup mentor, I always advise that getting the green light and some finance for any startup is just the beginning. For a pioneering business to get traction, it needs three elements:

1.??????? 'Need' – clearly this was a big tick – the concept of internet shopping was gathering pace (and clearly, in hindsight, on the side of history!)

2.??????? 'Technology' – George’s initiative scoped out that the Virgin Biznet concept was possible without the need for too much invention or resource.

3.??????? 'Commercial Viability' – what and how would the business make money vs costs of delivery and, ultimately, can the initiative be scaled??

For this third element, Virgin.net’s CEO, David Clarke appointed Mylène Curtis to research the concept and write the business case for a portal that would serve the business community. ?An internal team was gathered to ‘create’ the business and Virgin Biznet was founded, with Mylene as its CEO, alongside George who became its CTO.

The actual company was set up as a joint-venture between Virgin and a new tech company based in Scotland called iomart who would both host the Virgin Biznet website as well as provide technical and customer support. Part of the Virgin Biznet proposition was to provide the tools online for customers to build their own websites or have them built for them. So, with the help of EU development funding, Iomart set up a call centre on the island of Stornaway, where both the help and customer website-build support teams would be based - a ‘canny’ move as most of the staff had grown up together on the island and so brought a unique and family feel to this centre packed full of high-tech in the middle of a remote landscape! Certainly an experience to visit!

The other part of the jigsaw was the e-commerce platform itself. Iomart was able to not only provide ISP services to Virgin Biznet customers, but also offer a web-build platform too as they had started to host a new cloud-based platform from the US called Netopia. Netopia would be adapted and used as the heart of the web-build services for Virgin Biznet under the product name SiteBuilder.

Note that, whilst in the media anything ‘Virgin’- branded was attributed to (the now Sir) Richard Branson , in reality, Virgin Management operates more like a VC, providing both funding and a name to accelerate innovative initiatives, especially those that champion the consumer.

As with any startup that has been given a decent capital injection (then and now!), the race to get started and operational was key - the business had set a timeline to enable customers to build websites and try and take advantage of the consumer spending traffic for Christmas 1999. The launch team was recruited quickly to cover the two main parts of the business - business information (content, editorial, news, advice) and the web-build services, with the marketing, promo and commercial side falling under the leadership of ex P&G and Motorola exec, Afam Edozie . Indeed, so under pressure were they to get the business started that Afam and the rest of the development team had to sleep under their desks in the days before launch! (This was also typical of the dot-com industry at the time - the adrenaline and excitement was driven by the fact that, over the internet, a small team centrally could launch services that could be accessed and provide help to such a wide public audience - something which had never been experienced before.)

Virgin Biznet was launched on October 14th 1999 - by which time the team had created the business information portal, integrated the web services and created a brand and welcome pack for customers - who could sign up on a 45-day free trial.

I, for my sins, arrived just after Christmas from 汤森路透 (the ‘Google of the 90’s’) to innovate and expand the e-commerce services side of the business (driven by my experience as a tech entrepreneur, my personal passion for retail as well as being ‘Mr Web’ at Reuters Health)… and so started one of the most exciting and creatively prolific periods of my working career - one with a long-lasting legacy both to me personally as an e-commerce innovator and for the industry as a whole.

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>>> NEXT - Read on to find out "How do you get people to trade online when they haven't even experienced the internet?"

Part 2 - Leading edge… no! Bleeding edge!

https://www.dhirubhai.net/pulse/virgin-biznet-leading-edge-bleeding-shiran-liyanage-nbgce

Access to other parts:

Part 3 - Comic Relief and innovation, innovation, innovation!

https://www.dhirubhai.net/pulse/virgin-biznet-innovation-shiran-liyanage-ddgie

Part 4 - Downfall and Legacy

https://www.dhirubhai.net/pulse/virgin-biznet-downfall-legacy-shiran-liyanage-ygz8e

#ecommerce #pioneers? #shiran? #disruption #entrepreneurs #innovation #history #SAAS