Netscape Pioneer to Go Online With Health Site
Jim Clark, the onetime Stanford professor whose launch of 3-D computer maker Silicon Graphics and Internet phenom Netscape Communications have already made him one of the most successful high-tech entrepreneurs ever, is launching another new venture--an online health-care service called Healthscape.
Clark and the elite venture capital firm Kleiner Perkins Caufield & Byers, which also funded Netscape, have invested a total of $5 million in the new venture. Clark and Kleiner Perkins own 28% and 13.3% of Netscape, respectively.
Although Clark, 51, has assumed the title of chairman at Healthscape, he says he will not be a full-time employee of the company and he has no plans to step down as Netscape’s chairman. Clark founded Netscape in April 1994 with University of Illinois graduate student Marc Andreessen, and the company’s initial public offering last year was among the most successful Wall Street has ever seen.
Healthscape is working on a service to electronically disseminate medical information to a wide audience, including consumers, physicians and health maintenance organizations. “Health care is one of the largest and most dysfunctional segments of our economy,” says John Doerr, a partner with Kleiner Perkins. “The Internet can be used to make it more efficient by acting as a central place for claims and enrollment processing, for example.
“This will be a mix of consumer and business services,” Doerr said. “In this era of managed care, we all need to take more responsibility for our health and the Net can be used for that also.”
Netscape’s Internet browser, which is used by 75% of those who surf the Net, will be the “front end” for Healthscape, enabling users to cull information on the service.
Clark began toying with the idea for Healthscape about six months ago. “I began to look at vertical markets and it became clear to me that health care had a lot of possibilities,” he said. “It’s an enormous industry, and it’s so inefficient.”
Although the major online services and the Internet already feature an array of health-care discussion groups, Web pages and other health-related services, Clark’s involvement will give Healthscape a big leg up in establishing itself as a major force in the field.
Just as he started Netscape by wooing Andreessen and then putting up some of his own money to jump-start the company, Clark began Healthscape by hiring 10 engineers and programmers from Silicon Graphics, a company he founded in 1981 and angrily left 13 years later after a falling-out with current Silicon Graphics Chairman Ed McCracken.
“I didn’t think it would be so easy to put together a technical team,” Clark said. “I hired the best project manager I knew at Silicon Graphics, and as soon as people knew that he was leaving, he started getting calls from other people, saying: ‘You and Jim Clark are doing something? Count us in.’ ”
Clark is now looking for a chief executive for Palo Alto-based Healthscape, using the same executive recruiter who helped him find Netscape’s chief executive, former AT&T; and Federal Express executive Jim Barksdale. David Schnell, a medical doctor and a partner at Kleiner Perkins, has been acting chief executive. He has begun hiring a marketing team from the health-care industry, and the company now has about 20 people on the payroll.
Clark said the new company is a logical fit with Netscape. “It uses Netscape and leverages off of Netscape,” he said. The model is variation on the one that made Microsoft Corp. the dominant player in personal computer software. The Redmond, Wash., software giant’s core business originally was operating systems, and it used its ownership of the DOS and Windows operating systems to build a powerful position in applications software such as word processors and spreadsheets.
Similarly, the Netscape Navigator Internet browser is akin to an operating system, and Healthscape is an application that uses the operating system.
But Clark emphasizes the difference between the way Netscape operates versus Microsoft. “We wanted Netscape to be a clean software company,” he said. Although Netscape and Healthscape will share Clark as both investor and chairman, there will be no other financial connection between the two companies.
Microsoft has been widely criticized for using its dominance in operating systems to gain an unfair advantage in other software markets. “We didn’t want people to accuse of us of being like Microsoft,” Clark said.
