Tourist guide dubbed 'WAMBAM'

TALLINN - When Kamal Hassan was a tourist passing through Lithuania in 1998, he never expected he would find something there that would make him want to stay permanently much less become CEO of a Lithuanian-based company.

But after he picked up a smallish, colorful guidebook called In Your Pocket, he knew that was going to change.

The Toronto native explained that he went to visit his old classmate from the Insead business school near Paris, George Ortiz, who was one of the founders of the Vilnius-based company.

"George used to go on about his little magazine he had started up back in Lithuania, and we would laugh about it. When I was in Lithuania, I picked up a copy of Vilnius In Your Pocket just to humor him," Hassan said, joking with the memory of his ignorance. "But then I realized I've never seen anything as useful as IYP anwhere I've been. There is nothing else like it."

In Your Pocket was spawned in 1992 by Ortiz, two of his brothers and a German journalist to "simply get by," and get around a rapidly changing post-Soviet Vilnius. Among the cities the guides cover are Vilnius, Tallinn, Riga, Parnu, Kaunas and Klaipeda.

The original owners have since moved on, though they have retained ownership in the company.

In Your Pocket, now headed by Hassan, has become one of the largest city information providers in Central and Eastern Europe, currently publishing 19 acclaimed guides to major cities and capitals throughout the region.

Hassan can be further assured he made the right decision on July 13, the Baltic Republic Fund announced its $4.6 million investment in In Your Pocket for an undisclosed minority stake, making it the largest ever new media investment in the Baltics.

In Your Pocket has begun aggressively exploiting the Internet since January 2000. They had been offering the full content of their guides online since 1995 but never really promoted it very much until now. "We don't worry at all about offering the full content of our guides online at all because it only costs you $1 to buy the guide and a lot more to print out over fifty pages," said Hassan.

The company has said it will use the venture capital money to help expand its site to include e-commerce applications such as hotel booking.

In Your Pocket is now getting 20,000 unique visitors per week. They also launched a separate site with Lithuanian content only in June 2000.

Trigon Capital, one of the Baltic countries and northwestern Russia's leading investment banks, arranged the deal.

Hassan dubs his company a perfect example of an emerging trend in the Internet industry called "WAMBAM:" Web Application Meets Brick and Mortar.

"Brick-and-mortar," the term online-only businesses used to sneer at companies that shyed away from the Web, is a badge IYP now proudly wears.

The company shunned dot-com insanity, and instead proved it could sell its witty guidebooks on the newsstands and through subscriptions.

"From the start of this process, it was clear that IYP wasn't just another Internet gamble or a pointless Web site - this is a company built on real people, with real products, producing real content and generating real sales," said Trigon Capital partner Jason Grenfell-Gardner.

Despite the success of the company, Hassan explained that the task of finding an investor to expand its market into the e-world was anything but easy.

On one hand, Baltic companies typically don't invest in Baltic businesses that operate internationally. In Your Pocket currently has six offices, but by 2001, plans to triple in size, starting with Prague, Warsaw and the wireless-savvy Scandinavian capitals.

"And when companies here that want to invest in the Baltics think of a Baltic company that is multinational and new media, it is not the model people expect," he said.

Raising funds abroad is no easier, he added.

"They think Lithuania, and they think'Russian mall,'" said Hassan.

It took nine months of searching and raising funds before IYP decided on the Baltic Republic Fund, a fund which has also invested in other Baltic "new economy" companies like Microlink, Helmes and Alna. But the options were few, Hassan assured.

With the investment, IYP plans to start up a Wireless Application Protocol (WAP) page within the next few months. WAP allows users to read Internet pages on mobile phones and other wireless devices, though it is largely untested in the commercial market.