RESTON, Va. – Looking back, Ron Daly admits five years ago wasn't the best time to start a technology company. Shortly after Daly started Digital Mailer, the dot-com bubble burst and a general air of skepticism descended on tech companies, especially start-ups. It was actually started in March of 2000, with the bust coming the following month. Still that did not deter Daly, who had a lot to lose. A 20-year veteran of the $1.3 billion Northwest FCU, Daly had worked his way up to CFO at the CU. In a bit of a career mid-life crisis, Daly, who turned 46 on June 6, decided to go back to school to figure out where he wanted to go with the rest of his career or possibly to help him advance further in the credit union industry. He enrolled in George Washington University's MBA program and one of his final projects was to create a company with an online concept that could actually make money. It was here where the idea for eStatements and Digital Mailer was born, but not all were impressed. “My professor said `it's a nice idea, but you'll never get $20 million for it',” said Daly. And money is what Daly needed. Fortunately Northwest, the CU he spent 20 years with, believed in the idea and became one of the initial four investors/owners. The company has picked up some additional private investors along the way. Daly is the majority owner. In its first year Digital Mailer had only one client – Northwest. “We didn't get our second client until the second year. The goal was to get members to sign up (for eStatements). We tried a lot of stuff at Northwest that worked and a lot that didn't work,” said Daly. Northwest now has a third of its members (approximately 30,000) on eStatements and DigitalMailer has grown dramatically. It recently signed up Raritan Bay FCU in New Jersey as its 50th client. Daly says the company is staying true to its mission. “We offer virtual tools, that's all we really do. We're not an eStatement provider. We're a digital communications company. We help credit unions collect members' e-mail addresses, get permission to use them to communicate,” said Daly. Although he describes it as a “digital” company, DigitalMailer does offer print statements through one of its four print partners. It learned that some CUs want all their statement business done through one provider, so DigitalMailer had to form print partnerships. Aside from eStatements, Digital Mailer offers e-LERTs, e-Checks, eSurveys, eNewsletters, and e-Mail Campaigns. The cost savings of eStatements are often touted. Daly said there's a savings of somewhere between 50 cents to a dollar for an eStatement versus a print statement. Digital Mailer charges CUs between 24 to 29 cents a statement depending on volume. But eStatements are really only the hook to a much bigger picture. Daly said what CUs should be focusing on is getting permission to send e-mails to members and then using e-mails and other online tools, such as one-to-one Web banners to market products. “Everyone can do eStatements. It's become a commodity. The difference is what value you're going to pick up with them. That's why we work so hard to get the member online. It's very easy to tell with MCIF data what a member has and doesn't have and we can use the online communication to offer them what they need,” said Daly. And that's why marketing is so important for Digital Mailer. It provides brochures, posters and all sorts of marketing materials for credit unions to use to attract members online. One of DigitalMailer's owners is Shari Connealy, owner of marketing firm MagPie Communications. She provides the creative side for the company. “If it's not branded, they're welcome to use it. We don't nickel and dime them because if members don't sign up, we don't get paid,” said Daly. A good example of bringing members on through marketing is Beacon CU in Indiana. The CU already had close to 4,000 member e-mail addresses, but only had 300 members signed up for eStatements. DigitalMailer did a “pardon us” e-mail to market the product and helped the CU add 466 more eStatement users. DigitalMailer put together an iPod giveaway campaign to help lure members to eStatements. Daly said eStatements is one of the fastest growing tech products among CUs. There are now 1,600 CUs offering them. Daly is proud of the fact that DigitalMailer never offered PDF statements, which are just static pages. The company has always offered HTML statements, allowing for more customized content to be delivered. The good news now, said Daly, is DigitalMailer is starting to pick up business from competitors. Now that the technology has matured, a lot of CUs are coming off their multi-year contracts and shopping around for a new provider. “We just moved over Henrico FCU that brought us 2,500 eStatements,” said Daly. Another benefit of having permission to use members' e-mail addresses is to alert them of potential fraud. When NCUA was hit by a phishing attack recently, DigitalMailer stepped in and created an e-mail to alert members about the problem. Thus, all DigitalMailer CU clients could use that e-mail to get the word out to members. Looking back, Daly is thrilled he made the major career move to start a company. “Everyday is a different day, every hour there's something different to deal with. I can be in California one week talking about the online channel to credit union leaders and in Wisconsin the next, it's always changing,” he said. [email protected]