Washington Post

October 2, 2002 - Business Section - Page E5

The Bookmobile Reinvented

Roxanne Volkmann, who describes herself as addicted to mysteries, reads an average of six books a month. At $5.95 per paperback, the cost of that addiction can add up.

But Volkmann has found a particularly frugal way of feeding her habit: She orders books online from Booksfree.com, receives them by mail, and drops them in an envelope and sends them back when she's done. All in all, her membership costs $9 a month.

"I love it, I love it, I love it," said Volkmann, a Chicago resident, who has helped four other "freak book junkie" friends sign up.

Booksfree.com has 4,000 members, 93 percent of them women, who pay $6.99 to $14.99 a month to rent from the start-up's online library, which is stocked with 34,000 paperback titles. Its most popular titles are mysteries, romances and action novels.

Booksfree, which makes its home in a 3,000-square-foot Vienna warehouse next to a pizza-delivery joint and several industrial outfits, is run by unlikely entrepreneurs in a hostile economy. Its founders, W. Douglas Ross and Andrew E. Bilinski, at 60 and 54, respectively, are a generation older than the twentysomethings who rode the Internet boom to its peak three years ago. Booksfree, which came late to the online commerce scene, is one of the few remaining survivors.

"Our timing wasn't exactly good," concedes Ross, president and chief executive of Booksfree, who spent 23 years owning and operating a computer systems integration business just two doors away. Bilinski previously worked for EDS Corp., the Air Force and BDM International Inc.

"Doug had the idea for an entertainment services company, and at first I said, 'Nah, we are too old for the Internet,' " said Bilinski, who describes himself as a "full-time volunteer" who hasn't taken a salary since Booksfree started.

The company started in September 2001 with $1 million in capital raised from friends and former business associates. Since then, it has raised just short of $1 million more and has operated with four full-time employees, plus six or eight part-timers who take inventory and package the books.

Membership has grown steadily, from word of mouth and online advertising. One recent afternoon, part-time worker Carlos Luna, who is working toward a PhD in computer science at George Mason University, pushed a tray cart around the warehouse, filling orders placed online by customers from Maine to Texas.

The business model is similar to that of Netflix Inc., which rents DVDs by mail and raised $82.5 million when it went public this spring. Booksfree customers can take out as many as six books at a time, depending on their membership level. The company trades mostly in mainstream books that it orders from distributors Ingram Book Group and Baker & Taylor Inc., but it also boasts a limited number of out-of-print books by romance novelist Nora Roberts, for example, that Ross or Bilinski brought back from book shows. Its most popular book, with several hundred copies circulating, is Carly Phillips's "The Bachelor."

Bilinski and Ross say their biggest competitors are other online book sites, which sell rather than rent books, and local libraries, which don't deliver. Consumer retail books are a $13 billion business, according to the American Booksellers Association, so there's plenty of room for growth.

The company is not yet making a profit, although it only needs to sign up 3,000 more subscribers to break even, Bilinski said, and its goal is to reach 100,000 subscribers. With enough money to last through next year, the company's modest goal is "to grow and be profitable as soon as we can," Ross said.

In the meantime, Booksfree operates without delusions of grandeur. Everyone doubles as a book bagger, especially on days when 300 orders have to ship. Maryanne Fadul, Booksfree's comptroller, doubles as the company's customer service department. Ross is often recruited to take the afternoon shipment to the post office before it closes at 6 p.m.