The Advertising Age Interactive Hall of Fame: Jonathan Nelson, co-founder + chairman, Organic

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Back in 1993, before most of the world ever heard of the Internet Jonathan Nelson and three of his friends decided it was the right time to launch an agency that would specialize in interactive marketing.

San Francisco-based Organic originally was conceived as a Web-development shop, working with corporations to post glossy corporate brochures on the nascent Internet. However, that's not really what happened.

Instead, Mr. Nelson, 33, found himself riding the Internet rocket, taking two companies public in less than a year. He led Web measurement and analysis company Accrue Software, a company he co-founded in 1995, to an initial public offering in the summer of 1999. Mr. Nelson then took Organic public in February 2000.

"I had no idea all of this would actually become something-much less a multibillion-dollar industry-and I'd be lying if I now [said] that I did know it would be big," says Mr. Nelson. "I just knew that the idea of interactive marketing was really interesting."

Mr. Nelson might not have known how low his stock price could have plummeted, either. As the company's greatest shareholder, with voting rights on 59.3% of Organic's shares, he watched the company's stock tumble below $1 a share in December, off an all-time high of $60. The fall was sparked by news that Organic would miss fourth-quarter and early 2001 earning estimates and would lay off 270 staffers, or 25% of its work force.

In addition, recently opened offices in Atlanta and Boston would be closed, and Mr. Nelson, the company's chairman and founder, stepped down as CEO. Mark Kingdon, a former PricewaterhouseCoopers management consultant most recently with Internet incubator idealab!, was named CEO. Organic said Mr. Nelson would focus on guiding the company's strategy.

Still, Mr. Nelson says he thinks the slowdown in dot-com advertising is only a lull in the action, citing a list of new clients, including Target and Bell Actimedia. Organic also made a concerted effort in the third quarter of 2000 to reduce its exposure to dot-com start-ups: Pure-play dot-coms now make up only 8% of its revenues, the agency says, compared with 25% of revenues in 2000.

Organic discovered, however, that traditional marketers aren't immune to market cutbacks either: Troubled DaimlerChrysler accounted for 30.6% of Organic's revenue in the third quarter; although the direct effect on Organic remains to be seen.

Organic expects fourth-quarter revenue to be about $26 million, down more than 30% from the third quarter, when the company lost $16.5 million. While Mr. Nelson admits that "it's not always pleasant running a public company," especially on days when the Nasdaq tanks, "I still have a passion for this business that, while it has been tested throughout the years, hasn't gone away. We get to have a front-row center seat to help solve really interesting problems for some of the best companies in the world, like Sony, Federated [Department Stores], DaimlerChrysler."

In the last 18 months, Organic not only made the transition from interactive agency to "professional services firm"-a description Mr. Nelson believes more aptly describes Organic-the agency also added offices in Detroit, London and Singapore, meeting Mr. Nelson's goal of having a presence in North America, South America, Asia and Europe.

"Ultimately, the thing about being a public company is you're more accountable," says Mr. Nelson.

"It doesn't change the way I go about doing my business. If you present the value, put your clients first [and] show results, you'll be successful and people will invest in your future."

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