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It's almost side-splitting that The Business Press Maven calls for more historical perspective, so the business media dig up some historian who knows nothing of financial markets and
sticks him on the cover of
, but when it comes to a more basic article on Steve Case, who has a company that aims to set the credit card business on its ear, they completely ignore the most relevant factors in his -- and our -- recent history.
The excitable boys and girls at
ran with this headline: "Steve Case Takes on the Credit Card Giants: His new GratisCard slashes fees via net-based transactions. But can he wrest market share from the like of Citigroup, JP Morgan and Bank of America?"
You hear that? Steve Case is taking on! He's wresting! (That's not resting, mind you, but wresting!) If financial firms are not killed off by the subprime exposure they don't have much of, Case will do the trick.
Where have I heard this before?
Oh yeah, with Case's move to remake health care, mentioned in a quick and vapid sentence in the
story. At the time of the announcement, that move was greeted with headlines about him taking on and wresting (not resting) all sorts of things from the health care companies. I should know. I owned
at the time, and the market seemed to believe that Case's new effort would give WebMD a one-way ticket to Palookaville.
What ever became of Case's taking on and wresting (not resting)? Well, two years later, it just got a Web site up. And though I have many quibbles with its approach, it might even become a modest little player in the business. Not definitely, but it has an outside shot. (I don't own WebMD anymore.) The larger point, however, is overreaction to a business idea, whether in health care information or cut-rate credit cards.
We are told in the
article of some tests done at Philadelphia 76ers and Flyers games that went OK -- especially with lower-income fans -- and then we get a whopper. If you think the long-unfolding nature of Case's health care efforts were forgotten by the article, dude, get a load of this:
For consumers with low income or bad credit who are often charged high interest rates and fees, or denied credit altogether by banks marketing traditional credit cards, GratisCard could mean more opportunity. That's because the card plans to join with both prime and subprime banks, according to a source familiar with the matter.
You get a load of that? It's going subprime! It's going to join up with subprime banks or, uh, the ones that are left. I actually respect that, as I respected
announcement yesterday that it might be looking for subprime deals amid all the panic. But
did not mention that starting a business focusing on the subprime lending business at this particular moment in time might be extra difficult in the foreseeable future. It does mention his AOL success.
Case is one of my favorite businessmen of all time. The fake chumminess of that AOL-
press conference announcing the takeover, the purported merger of equals for the ages, was a classic of its form. Case had tried to sell his dial-up outfit to the emerging broadband networks, which essentially wouldn't give him one thin dime. Time Warner paid billions, and what followed -- a taking off of ties and a joint raising of arms in the air -- was so foreboding that The Business Press Maven covered his head in fear. Case, of course, could not stop smiling through the whole thing. He knew it was all going to pieces, and he had banked money beforehand.
God bless a smart man with big thoughts and a gift for the blarney.
Say You Want a Revolution?
That brings us to Revolution, the fund Case started a few years ago to invest and help along "insurgent" (as Case describes them) companies that will do nothing less than revolutionize American business.
Aux armes citoyens!
An entrepreneur must, by nature, be a little bit grandiose. But an entrepreneur with a tremendous success to his credit who managed to pull the wool over the old guard's eyes at just the right moment? That's when they can enter the realm of a little more than grandiose.
In his speech laying out what he's doing with Revolution, Case gets a little toward the far end of the grandiose continuum. He even draws a parallel between Revolution and
( BRKA), saying both are guided by a "built to last" philosophy. Never mind that Berkshire invests in things that -- like
-- have already lasted, Case is on a roll.
And maybe his timing -- with a health care Web site two years in coming and a subprime credit card during a subprime panic -- will work. Maybe Case has not gotten too grandiose for his own good. Maybe those "Take on! Wrest!" (not rest) headlines are pitch perfect this time.
Maybe Case's timing, as it once was, is still perfect.
By the way, do you know who Case chose for board members for RevolutionHealth? Two who would, in time, become the most identifiable faces of failure in government and business: Colin Powell and Carly Fiorina. All this makes the case -- at least in headlines -- to give it a rest. Not a wrest.
At the time of publication, Fuchs had no positions in any of the stocks mentioned in this column.
A journalist with a background on Wall Street, Marek Fuchs has written the County Lines column for The New York Times for the past five years. He also contributes regular breaking news and feature stories to many of the paper's other sections, including Metro, National and Sports. Fuchs was the editor-in-chief of Fertilemind.net, a financial Web site twice named "Best of the Web" by Forbes Magazine. He was also a stockbroker with Shearson Lehman Brothers in Manhattan and a money manager. He is currently writing a chapter for a book coming out in early 2007 on a really embarrassing subject. He lives in a loud house with three children. Fuchs appreciates your feedback;
to send him an email.