As a former executive at Procter & Gamble and PepsiCo, Jeff Goh is the first to admit he’s Corporate America to the bone. So when the 36-year-old Irvine entrepreneur sat in a Santa Ana school library last year listening to teachers and administrators brainstorm about how to make academia more efficient, it was only natural that he’d bring a businessman’s sensibility to the issue.
The result: Irvine-based Kawama.com, an acronym for the tongue-twisting “Kids Awakening to Web-Lifestyle in an Age-Appropriate and Mentored Approach.”
“The kids think it’s Hawaiian for ‘cool stuff,’ and I can live with that,” Goh says. The site simultaneously targets school administrators, teachers and students, with a service that includes everything from school supply auctions to lesson plans to online games.
Goh says several school systems, including Chino Valley schools, and more than 50,000 individuals have signed on to Kawama’s services.
Though Goh wouldn’t disclose his company’s financial details, he says the for-profit firm recently attracted a round of venture funding he pegged in “the millions” and is seeking another round “in the tens of millions.”
Kawama will use the money to double its 55-person workforce and buy new space. The company is looking for 10,000 square feet now and may need “well over” 30,000 square feet within the next 18 months.
Most of the company’s profits likely will flow from its online procurement service, which automates the time-consuming and expensive procurement process. Kawama will take a commission from sales generated through the site.
In addition to the obvious advantages of allowing schools to comparison shop, schools save about $125 per purchase just by using an automated, paperless process. That’s how much the U.S. Department of Education estimates it costs schools to generate one requisition form.
At the same time, Goh and his co-founders say they’ll bolster the educational process with online teaching materials and test-preparation guides.
The company formally launched this month and has already signed a deal with AskJeeves.com, a popular online search engine that hopes to cash in on Kawama’s audience by offering a directory of online resources that is age-appropriate. (Children who do a search on “sex,” for instance, won’t get a directory of pornographic sites.)
Similar to deals that AskJeeves has made with other partners, the company will pay Kawama for Internet traffic sent to a co-branded site that uses AskJeeves’ natural-language search engine.
While Goh’s background selling shampoo and potato chips might seem antithetical to bolstering education, Goh says the company’s focus on automating procurements fits well with his experience in the business world.
According to Gartner Group Inc., the educational procurement market exceeded $115 billion in 1999, making the so-called B2B educational market a lucrative one. Adding Kawama’s remaining components, the market grows even bigger , as high as $670 billion, according to a Lehman Bros. report.
Kawama plans to target the wholesale supply, service supply, capital goods, and assessment and curriculum markets.
Goh’s co-founders include USC professor Martin Eaton, computer-industry veteran Kurt Adams and former real estate company executive Richard Kato.
And Nexgenix,an Irvine company that counts such heavyweights as AST co-founder Safi Qureshey and former Ingram Micro co-chairman and chief executive David Dukes among its directors,has taken an equity stake in Kawama described as being in the $1 million range. Nexgenix is helping build Kawama’s web site and develop its business strategy.
Kawama has a host of other tech experts rounding out its team. Matthew Forget and Eric Fristed, who helped launch San Diego-based medibuy.com, developed Kawama’s procurement engine, which uses the reverse-auction format popularized by Priceline.com, pitting bidders against one another to give buyers the best price. The pair developed a similar system last year for medibuy’s healthcare-supply procurement system.
For the educational component, Kawama has enlisted the aid of several nationally distinguished school principals still active in the school system to ensure the content is relevant.
But the company isn’t all work and no play. Keith Higashihara, a developer at several educational videogame makers including Sega of America, runs the company’s Game Zone, which offers several educational and action-oriented games for students.
“Schools can see that we’re not just coming to them with a one-dimensional solution,” says Fristed, director of the company’s e-commerce business development. “We have a comprehensive program where each part helps the other, to give schools the best overall total package of services and products.” n
