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Ask Jeeves

Making Waves

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Features May 2004: Volume 1, Number 2
   

Ask Jeeves
(continued)

 
     

As the queries started rolling in, Warthen and his crew got a good look at what was on the average American’s mind. “People wanted to see naked pictures,” he says. “It’s still a major use of the Internet, but back then it was something like one in five questions. The entire time I worked at Ask Jeeves, Pamela Anderson was a top 20 query. Pamela Anderson and all her misspellings.”

Questions such as “How do you get rid of the skunk smell?” were constants, but other topics came and went. The Ask Jeeves crew could see cultural waves approaching long before they crashed ashore: Teletubbies, Pokemon, Backstreet Boys. “We could see emerging trends and address them early,” says Warthen. “After 300 people had asked the query but before 30,000 had, we could get those little capsules of knowledge into our knowledge base and have a clear, really good-quality search result.”

The Dot.Com Rollercoaster

Late in 1997 the company upgraded offices and some months later Rob Wrubel was hired as the company’s first CEO. At that point the company “took off like a rocket ship,” says Warthen. By October 1998, Ask Jeeves was doing 300,000 searches a day; a year later, it would be up to 2 million a day. They then added a corporate search site that allowed users to search within a company’s website and, in July 1999, Ask Jeeves made a spectacular debut on the stock market.

Offered at $14 in the initial public offering, the stock jumped to $60 on the first day, the third-best first-day performance in history at the time. “People were starting to realize that the web was a real thing; it wasn’t a passing fad,” says Sherman. “As it continued to grow, the only way people were going to be able to make sense of things was through the portals or search engines. Ask Jeeves was right in the sweet spot as one of the major players.”

The payroll soon ballooned to 850 people. In December 1999, the stock price reached $190.50 a share. Life was good. For one Ask Jeeves party at Ruby Skye in San Francisco in early 2000, Elvis Costello was the hired entertainment.

The giddy glow of success wouldn’t last long. In March 2000, the NASDAQ headed south, as one dotcom after another went bust. Ask Jeeves continued to do well although its stock started to slide. Warthen left the company midway through that year, following former Ask Jeeves president Ted Briscoe to Global Streams, a digital video technology startup. “Ask Jeeves was in transition,” says Warthen, who would serve as Global Streams’ chief technology officer for two years. “It seemed like the right time to go.”

The stock price continued to fall and, by November, the only thing still flying high in the company was the Jeeves butler balloon in Macy’s Thanksgiving Day Parade. (It would bottom out at 86 cents in June 2002.) At the turn of the year, the company was hit by a double whammy: while advertising was in a cyclical downturn, a lot of their corporate customers were in distress or decided to forgo any web initiatives.
“The crash felt terrible,” says Gruener’s wife, Amy Slater, who served as Ask Jeeves general counsel until mid-2000. “I didn’t think we deserved to be lumped in with all the people who just made up stuff. Ask Jeeves survived, eventually, because there was actually something there. It may not have grown to be all it could have been, but it wasn’t fluff. It wasn’t selling cat food over the Internet.”

Gruener remained on the board as the company hired new leadership, scaled back the payroll and ditched peripheral businesses. Then in September 2001, the company acquired Teoma, a search-engine technology that replaced the question-and-answer template and meta search. In the fourth quarter of 2002, Ask Jeeves reported a $2 million profit, its first foray into the black.

“The world had changed,” says Gruener. “We had to become leaner and more focused. We had to become profitable. We succeeded, but it took a long time.”

In 2003, the company stock recovered, soaring 500 percent to become the seventh best performing stock in the Bay Area that year. In April 2005, Ask Jeeves, by then the world’s fifth largest search engine (behind Google, Yahoo, MSN and aol), was purchased for $1.85 billion by the media conglomerate Interactive Corporation. At the time of the announcement, IAC president Barry Diller called Ask Jeeves “potentially one of the great brands on the Internet and beyond” and expressed the expectation that it would serve as “the glue” for all his other companies.

“It’s a very different company now,” says Chevsky, who is now a senior director at the company and the only original employee left. “About the only thing that connects the company today to the one that Garrett and David started is me.” (In late February Jeeves himself disappeared, as the website became, simply, Ask.com.)

Gruener stayed until the IAC acquisition, while continuing his career at Alta Partners and making a run for governor in California’s 2003 recall election. “I still consider it my baby,” he says of Ask Jeeves. As the chair of a task force for the state superintendent of schools, he visited a number of schools that used computers in the classroom. He recalls asking one teacher, “When your students do research, where do they go?” Ask Jeeves, of course, she responded. “That warmed my heart,” says Gruener.

“Ask Jeeves is probably the number one thing I’ve worked on,” says Warthen, who now runs a small video game company called Eye Games and recently finished his coursework at UC-Berkeley for a Ph.D. in children’s new media. “Some of the other things I’ve done were really cool, but they are really hard to describe. They were making networks run faster, or making processors talk to each other. My mother used to say, ‘My son, he works with computers.’ End of story. Now she says, ‘My son created this Internet search engine called Ask Jeeves. Have you tried it?’”

Kelli Anderson is a senior writer at Sports Illustrated.

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"In December 1999 the stock price reached $190.50 a share. Life was good...It would bottom out at 86 cents in June 2002."