His network funds a virtual one

By all measures, Geoffrey Cook, 31, can count himself as a huge success in the world of online commerce, and his current venture, myYearbook.com, is no exception.

A social-networking site conceived by his two younger siblings when they were in high school, the New Hope company, now five years old, brought in more than $2 million in revenue last month and finally turned its first official profit in the spring.

"It's a milestone," Cook said. More important, he said, "we don't feel we have a need to raise more money to run the company the right way. We never wanted to be dependent on the next round of venture capital."

Even so, it was Cook's network of friends and former investors that landed the company a total of $16.9 million in venture capital in two rounds - enough to employ 84 people and outfit headquarters in trendy New Hope.

There is nothing unusual about Cook's trading on friendships and business relationships. Many opportunities - whether in business or employment - rely on a network of connections.

What gives this a twist is that Cook's business network is funding a social-network business, which started as Cook's sister and brother, Catherine and David, now college students, traded on their family network by telling him their idea and persuading him to be their angel investor.

Networking "is critical to operating in general," Cook said. "The reason you do it is because it's important to have access to the right people to help you make decisions and find the right contacts."

One of the "right people" was Christopher Fralic, a partner at First Round Capital L.L.C., of West Conshohocken. Fralic and his firm turned out to be a huge link in Cook's business network, investing in the venture, providing introductions to other investors, and helping find top company management.

"I would say Geoff is good at networking for sure," Fralic wrote in an e-mail, "but it's more than that. He's smart to surround himself with a strong team - management and advisers/investors."

Fralic's initial meeting with Cook took place at myYearbook's New Hope offices. Fralic, who lives less than two miles away, simply walked in and said hello.

One of Fralic's First Round partners is Josh Kopelman, a local entrepreneur who made a national name for himself by creating half.com, an online seller of used books, music, and movies. Later, half.com was sold to eBay.

A significant contingent of myYearbook.com's investors and top management have a half.com/eBay connection.

Geoff Cook's business network began at Harvard University, where, as a sophomore in 1997, he developed two online businesses, EssayEdge and ResumeEdge. One of his roommates was Spencer Rhodes, who was pressed into service as a business developer and, years later, tapped into his network of Harvard Business School graduates to find investors for myYearbook.com.

Within three years, revenue at Cook's Harvard businesses were tracking at $400,000, enough to attract the attention of Wired magazine, which profiled him in March 2000. A reader, Terry Herndon, a Massachusetts Institute of Technology researcher, contacted him and became Cook's first investor.

Cook's family lived in New Jersey, but when Cook graduated, he moved himself and his business to the Bay Area, the dot.com business mecca.

In 2003, a New Jersey company made Cook a millionaire, buying his businesses on the condition that Cook return to Jersey and run them for a while.

A bonus? Family dinners in Skillman in Somerset County.

"That's when they told me the concept of putting a yearbook online," he said of his siblings, Catherine and David. "I was coming off my other companies and I was interested in getting involved."

He kicked in $250,000 to fund site development for Insider Guides Inc., the actual corporate name. "We were working from our bedrooms," Catherine Cook said.

She contrasted the site with Facebook, which is a networking site for people who know one another. This, she said, is more like going to the mall - users can play games, flirt, spend virtual cash, and chat with people they meet online. It's the mall-rat demographic, ages 13 to 24.

With his partners in high school, Cook needed office space close to Jersey. They looked in Princeton and New Hope, but preferred the Bucks County vibe. Their landlord, George E. Michael, ended up investing in the business - a tie that mattered when a group of potential investors unsuccessfully tried to persuade them to relocate to Boston.

Employee perks include a membership at a gym in the same complex. Anyone who works after 8 p.m. gets a meal card that can be cashed in at the pub next door.

"It gets a lot of use from the team - especially on a Thursday or Friday, you'll find at least a dozen people there," said Catherine Cook, who joins them even though she isn't old enough to drink.

"They sell Coke," she said.