Holding His Cap Out For Cash

Asking for money does not come naturally to the stubborn Internet artist. When the 'suits' rebuff him, his confidence grows: It's proof togglethis is cutting edge!


Two men in suits enter the elegant third-floor conference room of the Paine Webber building in Manhattan, and turn to face Marc Singer at the other end of the table. He tugs nervously at his black and white Los Angeles Kings cap, but does not bother to take it off.

The cap keeps him cool and relaxed. This is the office of togglethis' new lawyer, Josh Gillon, a young corporate attorney. Gillon met Marc, a new kind of Internet entrepreneur, in the oldest of ways: connections. Marc's father, a lawyer in Baltimore, has a close friend in Charlotte, a successful investment banker named Larry Brown, who called Gillon in New York -- a 1,000-mile detour to find someone a cab ride away.

Gillon, 34, immediately fell in love with the idea of creating interactive cartoon characters for the Internet. In spite of the doubts of his firm's 20 other lawyers, Gillon is introducing Marc to his clients, including investment banks Credit Suisse First Boston and Bear Stearns. "I'm taking a chance on you," Gillon tells Marc. "I won't charge you until you make it big."

It is not at all clear, Gillon and Marc both know, that togglethis will ever escape the embryo stage. Marc has used an initial $50,000 investment from two friends to sustain togglethis for six months. But there is now less than $5,000 in the bank.

Marc and his partner, Paul Maya, have turned down a handful of unsolicited investment offers -- including a $1.35 million bid from a Wall Street investment bank for half of togglethis -- on the grounds that those potential partners don't seem to understand their vision. Their programmer, Rajan Parthasarathy, is no longer content with "virtual raises." He wants cash now, or he may take a job at Microsoft.

The situation is so desperate that Marc and Paul have all but dropped their creative work to devote themselves to finding the money they need to stay alive. In this endeavor, they are not naturals.

At ease while writing or brainstorming over characters, Marc twitches uncomfortably when talking with bankers. Every wrinkle in his unironed shirt stands out. A fund-raising pitch feels like class at his old Baltimore high school, McDonogh, full of people wearing the right clothes and worrying about saying the wrong thing.

There are a thousand little indignities. Begging for money means flying out to San Jose, where you sit in traffic on the way to the glass-covered homes of Silicon Valley investors who want you to be the next Andy Grove (Intel's founder and chairman, for those not in the know). It involves calling the organizers of a Hollywood party, pretending to be a studio employee to get your name added to the guest list -- only to show up and spend two hours drinking gin and tonics with coked-up Hollywood washouts who lack the authority to give you cash.

It requires going to four-star Manhattan restaurants with insufferable bankers and having to talk so much you leave hungry. And it means watching the lawyer who has turned you down roar off in a Jaguar expensive enough to cover last quarter's unmet payroll.

In Gillon's conference room, Marc hears the same objections again and again. Investors are eager to put their money into hard technologies and software, products you can put in a box and ship. But what will togglethis make? In a world where all new media stocks are highly valued, even the most speculative investors are skeptical. How does one invest in an interactive character? What would such a thing look like? Without a finished character to sell, Marc is forced to sell himself. And in his L.A. Kings cap and flannel shirt, he doesn't seem like a sure bet.

To each potential investor, Marc politely explains that interactive characters -- like any entertainment -- have value. If enough people want to see interactive shows, companies will pay money to sponsor them, the same way they do television programs. But Marc goes further: He says the interactive possibilities of the Internet will eventually allow him to create characters more compelling than anything you can see on television. Give me funding, Marc says, and you will buy a stake in a new entertainment, a new medium for programming, that will rival TV and then outstrip it.

Marc is solicitous in these encounters, asking for advice. But with each polite rebuff, he is -- paradoxically -- more defiant, more sure of himself. He thinks of the lesson he learned from Joel Smith, the Los Angeles filmmaker who hired him to do a Harley Davidson documentary two years earlier. Distrust the guys in suits. Don't let them change your idea. The fact that the guys with money, the venture capitalists, the bankers, don't understand interactive characters is a good sign, Marc thinks.

It is prima facie evidence of just how cutting edge togglethis is.

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