When booming business brings bigger bashes

Last fall, Acteva, an online-ticketing service, celebrated its new company name with a party in an airplane hangar.

No big deal in itself.

But the venue was on Treasure Island, a spit of land hunched under Oakland's Bay Bridge.

And it wasn't your usual get-together. About 3,000 guests showed up and were treated to everything from pig races (the animals were named after dotcom companies) to a chance to swing from a flying trapeze, aided by professional acrobats.

Guests could also rock climb, try not to get stuck in the Velcro obstacle course, or throw haymakers at opponents in the boxing ring (with overstuffed gloves, of course). San Francisco Mayor Willie Brown even showed up.

"The biggest thing [to] a dotcom company, especially like ours, is awareness," says Lu Cordova, CEO at Acteva.

The bash became legendary and often crops up in conversations about dotcom parties, a hot topic in Silicon Valley, where as many as five or six such fetes happen on a given night.

Look at me! Look at me!

The days of warm deviled eggs and rowdy kids - once staples of company parties - are long gone. Now businesses - especially those swimming in streams of venture capital - routinely shell out loads of money for big-time galas, say experts. Companies are resorting to bizarre and sometimes decadent tactics to lure, retain, and above all, impress employees - and the competition.

"If you're going to be in Silicon Valley and you work at a dotcom, there is a 'cool factor' that ideally goes with that," says Margit Wennmachers, whose San Francisco company, Outcast Communications, helps design dotcom parties. "There is such a heightened noise level that companies are being more creative to get attention and stand out in a positive way. Having an event like that is one way of building that brand."

Some recent examples:

*Respond.com, an online shopping site, held a bash last year in a furniture gallery. Acrobats and contortionists from Cirque du Soleil, a Montreal-based circus, coiled themselves while mingling with the audience.

*At salesforce.com's party this February in San Francisco, the B-52s jammed as guests pitched CDs into a toilet bowl and toppled packaged software off a shelf, in keeping with "the end of software" theme.

*Last May, Massachusetts-based Jordan's Furniture shut down the entire operation, chartered four airplanes, and flew about 1,000 employees to Bermuda for the day. They hired three bands that rocked while employees played volleyball, softball, and crisped on the beach. Shuttle buses took shoppers into town.

"It literally felt like we all had a group hug," says Heather Copelas, director of public relations at Jordan's. She says customers still comment on the trip, and employees often wear their trip hats and T-shirts.

While most firms budget wads of money for the company party, figures vary.

According to a survey by the Society for Human Resource Management, more than half of those polled said their holiday-party budgets for 1998 were less than $10,000. Fourteen percent showed budgets between $10,000 and $19,999. Budgets between $20,000 and $49,999 were reported by 10 percent. Only 4 percent said their organizations spent more than $50,000 on their parties.

But this is simply spare change found under the couch cushions compared with what dotcoms are spending of late. "When the money is great, they don't mind doing the parties," says Christine Virsunen, owner of Encore Productions, a strategic-event planner in Sunnyvale, Calif.

That's for sure. Just ask Pixelon.com. Last year, their launch-party extravaganza was fit for a small country. The start-up company specializing in online-video services rented the MGM Grand in Las Vegas and hired the 1980s face-painted band KISS, country darlings the Dixie Chicks, and velvet-voiced Tony Bennett to entertain the masses.

The price tag of the hootenanny: $10 million, almost half the venture capital given to the company.

Impressing new workers

Some experts say this extravagant spending is a waste of money, while others see it as a branding method that comes with the dotcom turf.

"Everybody wants to work for a fun company," says Ms. Virsunen. "[Employees] like the parties, they want the get-togethers, they want the team building; it's just a little break from the daily drive of work, work, work...."

There are ways to do it cheaper. Acteva, for example, pulled off its party for a little more than $100,000.

"We got so much buzz out of it that ... a lot of our potential investors came to party. The next day they were doubling their amounts," says Ms. Cordova.

The benefits of a good bash don't end there. "We have been able to build this company to over 70 people with no in-house recruiter," Cordova adds.

With the strong economy and decreasing US labor pool, retaining employees - not just attracting new ones - is high on the list of employer concerns, says Anne Pasley-Stuart, CEO of Pasley-Stuart HR Consultants in Boise, Idaho. "So if by having a party, or other perks that are relevant, helps keep employees, then that's where you want to spend your dollars...."

Ms. Virsunen knows the value of well-spent money, and so do her customers. She says companies increasingly let employees propose ideas for company parties. Recently, she hired 50 massage therapists as per employee request. She also routinely hires magicians, caricaturists, tarot-card readers, and henna painters.

The trick to a memorable party, say experts: innovation. "You don't do something bigger and better, you do something different," says Cordova.

(c) Copyright 2000. The Christian Science Publishing Society