Since PalmGear.com was more like a hobby than a business, founders Kenny West and J.D. Crouch never dreamed of hiring a full-time Web development staff. They contracted with an outside group (which shall remain nameless) that had little experience--but much enthusiasm--to put together the first generation of the site. From the get-go, West and Crouch and a small staff processed orders via a mix of Yahoo! Store and cobbled-together ColdFusion code. This setup was tolerable in the early days when orders numbered in the low hundreds per day. And it was cheap--only $300 per month with no per-transaction fee. But it was highly inefficient.
By the middle of last year, pages were loading incredibly slowly and downloads took forever. "The system was seriously backlogged. It was a mangled mess. The [SQL Server 7] database couldn't handle the traffic--it was caving in on itself," says Tim Jespersen, chief Internet strategist for DPC Group Inc., a Dallas Web development firm West called in after concluding last August that the previous team couldn't keep up with the demand. The previous Web team had been deleting the Web logs due to lack of space on the sole Web server. "No one had ever looked at Web traffic before," says Jespersen. "We were finally able to figure that out." Once he saw them, the traffic numbers were a call to action for West. "It was either do this or go out of business," he says.
For West (who owns 65 percent of the business) and his partner, the realization that the site needed to re-written from the ground up meant facing the fact that their little project was going to cost some real dough--and without the cushion of venture funding. The new Web team was much more expensive than the previous one; Web site development last year ran about $500,000. "That was more than I wanted to spend," West admits. But there was no question of a classic return-on-investment analysis. The site had hit the proverbial wall, and if he didn't do the upgrades, the company could not continue. With this investment under his belt, West expects his cash situation to improve in the next year or so.