I was in the health field -- first a labor and delivery nurse, then in public relations. One day I watched a person preparing a brochure for us on a desktop computer. The thousands of fonts that could be used fascinated me. I went home, got myself a computer, and spent the next two years learning all the programs I could. At that time the Internet was coming around nicely and I started a web design company out of my house -- 1Mainstreet.com -- a tiny company. I was from a corporate background -- very large hospitals and companies like Johnson & Johnson -- so I had to learn about small businesses gradually.

I had a customer who wanted to become the next Amazon.com. I looked at the software applications that were out there and couldn't find anything, so I asked my partner to write the program for such an application.

Yes, at first it was just me. I was taking all the calls, doing all the customer service, and providing all the tech support. But I felt that we looked too small for a larger company to want to do business with us. So I made up two other "employees." "I" would work from 7 am to 3 pm -- a typical nurse's shift. Then from 3 to 11 pm, the second "employee" would answer the phones. (I'm afraid to give the name of this "employee" lest one of my early customers might recognize it and say, "Oh, I talked to her."). The third employee would come on after that. We had to have an appearance of being a little bit bigger than we were.

We started in the loft of my house. When I brought on a sales person, we used one phone that we passed between us. We were concerned that people might be afraid to purchase from us because we were so small, but we were highly competent. We just had to have the appearance of being a professional business. I tell my customers, "Act like you're a big business and you'll be trusted." Kind of like, "Smile and you'll be happy." Everything on the Internet is appearance.

We were only three people in November 1998 when we won the PC Magazine Editor's Choice award against Yahoo! Store, iCat, and IBM. When PC Magazine called us and said, "You've won in your category," they asked if we wanted to place an ad in that issue. "Sure," I told them, "how much would it cost?" When they told me $51,000, I said, "I don't think our budget can handle that this month. Can we talk about next month?" Currently, we have nine employees -- all homegrown.

We feel that it's more important for programmers to know how business works, rather than just how to write code. We are a merchant-driven company. Our customers tell us their needs and then we develop the software to meet those needs. Many of our clients are one-person businesses -- 90% are small businesses (under 300 employees), 5% are medium-size (300 to 400 employees), and 5% are large (over 400 employees).

I see being able to put in enough time and enough money as a problem. And, of course, marketing is still very important. We have never seen a company close down yet that has put a great effort into marketing and into staying open. We send our newsletter, the Monday Merchant, to our customers every week with marketing tips to help them promote, promote, promote in order to gain a following. Once you've begun to develop your following, the following grows.

Certain merchants seem to have an incredible amount of success. We've seen excellent success with brick-and-mortar companies that set up an Internet site to grow their business. Also existing catalog merchants that move part of their mail order business onto the Internet are doing well, too. Strangely, some of the largest companies do very little business on the Internet -- it's more of a PR presence for them and they don't really count on that revenue.

Products that succeed are often the ones that customers don't need to touch and feel, products that they already know by reputation and name. We have a new merchant, www.PostalUniform.com that supplies uniforms for postal workers. People know what size they need and it's very convenient to have them delivered. Pet food, too, can be delivered and is more convenient than going to the store and lugging it home. Baby clothes are a fantastic online industry right now because mothers don't have time to go shopping for their infants. One of our sites, www.LaborGear.com is meeting the needs of middle-of-the-road buyers of maternity clothes -- not just the high fashion buyers.

Unique products that you can't find easily elsewhere also do well, such as www.DiabeticJuvenile.com. Where can you go locally to shop for your diabetic child? But you can order all kinds of healthy food over the Internet. www.kidcostumes.com succeeds since so many stores are out of everything at Halloween. KidsCostumes.com are never sold out.

We've found that most of these merchants don't have a big rush immediately, but they grow gradually.

No, I don't see it going just to big stores. I've been observing our customers over the last four years and have watched them struggle and grow. They're not being noticed or evaluated by the press. But they are scrapping to make the sales, working hard to make the sales -- and growing gradually.

People go to the big sites because they're not afraid to give them their credit card information. People wonder: "Who is this person in Arkansas, and why should I give him my credit card number?" I advise Internet businesses never to use a post office box as an address. Use your home address if you need to or a Mail Boxes Etc. type of address that doesn't have a P.O. Box. Have a customer hotline and don't answer with "Hello" but rather with your business name. Work hard to appear professional.

I see it plateauing in the US, but there's enough attrition and growth that it's staying level. 50% of our customers come from other shopping cart systems. The other 50% have been watching online business and have finally decided to jump in. Of this second group, half are already established brick-and-mortar businesses.

We used to worry that any programmer could build a little shopping cart. We studied them carefully and found that few were infrastructure providers. Both large and small businesses need an infrastructure to run their businesses, not just a buy button.

These are processes such as billing, shipping, distribution, notification of drop-shippers, and different kinds of payment solutions that integrate with the system. It's easy to plug into the UPS shipping cost engine, but it isn't really that simple.

We had a merchant who was selling contacts with mail order pen pals. He would show the picture of each on the site. If you want to be her pen pal, for example, you'd have pay $7. But the merchant made the mistake of putting each girl's weight into the shipping weight column. The price of a picture might be $7, but for an average size pen pal it would cost $700 in shipping. (Laughter) You need to allow for customization to meet a merchant's needs.

Business software has to be less exclusive to the Internet and provide more down-and-dirty business tools. You have to take care of the basics of business -- what your merchants need to run their businesses. It was so surrealistic -- all these companies soaring into IPOs. But now it's getting more realistic, and I see it leveling out and becoming more stable.

We're getting calls from e-commerce providers that want us to buy their customers. These tend to be from free applications, cheap applications, or ones that don't fit well with ours. A lot of them are closing down. The ones that stay or hang on do so because their business model is strong. Ours is; we exist on regular revenue.

Yahoo! Stores is one of our very few competitors. Intershop used to be a competitor, but you don't see much of them any more.

Their size and visibility are strong, and the application is not bad. It's not developed to the point that ours is, but it's very user-friendly and very visible. Our customers, however, seem to be looking for a more feature-rich application. It used to be that all Yahoo! Stores looked alike. We have 40 different templates that offer a whole variety of product layouts.

They came out with bCentral which is a small, simple program and much less than we expected from Microsoft. We are Microsoft fans, and had higher expectations.

From a competitor's standpoint I was upset. How can you compete against something free? I'm sure we lost some sales to them. But then I realized that these free providers still had to find a way to make money. We were very disappointed with PC Magazine for recommending two such free e-commerce programs at a point when the industry was so volatile. I think it was a bad business model and unlikely to survive since it depended on Venture Capital sources to fund their operations. We also think that most of those who used the free products tended to be hobbyists, not serious business people.

From the merchant's point of view you have to ask, "Will they be there for me tomorrow? Or will I have to scramble to find a new e-commerce application and set up all over again?"

The breadth of features we offer and our great versatility. We had considered Lite, Advance, and Super-Advanced versions, but we've ended up with all our clients using the same version and receiving all the updates as we continually improve our application. Most of our merchants will use perhaps 20% of the features, but a few will use them all. We also offer optional modules with features that aren't used by as many of our merchants. We didn't want to clunk up our interface with elements that few would use. Our application is so robust that it has always separated us from our competitors.