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For-Profit Crusade Against Junk Mail - New York Times

12/8/09 1:20 PM

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For-Profit Crusade Against Junk Mail
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laura.a.novak@gmail.com
Peter DaSilva for The New York Times
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Pankaj Shah started GreenDimes last year to stop junk mail while aiding the environment.
By LAURA NOVAK
Published: September 6, 2007
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Correction Appended
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PALO ALTO, Calif. — Pankaj Shah may be the only chief executive
in Silicon Valley striving to put himself out of business.
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He is the founder of GreenDimes, a small business with big plans to
stop junk mail while aiding the environment. If Mr. Shah has his
way, millions of tons of unwanted mail will go the way of pesky
phone solicitations. And the planet, not just consumers, he says, will
reap the rewards.
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GreenDimes is one of several companies nationwide begun in recent
years to organize information about a customer’s unsolicited credit
card offers and money mailers, or no longer desired catalogs, and
then perform the legwork to halt the flow.
The Direct Marketing Association, a trade group of 3,600 direct marketers and mail
order companies, reports that marketers will spend nearly $56 billion on direct mail and
catalogs in 2007, which will generate an estimated $700 billion in sales. That translates
into an average of 26 pieces of mail a week for each household, according to the United
States Postal Service’s Household Diary of 2006.
“Everybody gets junk mail, and nobody likes it,” Mr. Shah said.
The company pledges to plant one tree a month for every person who registers.

For-Profit Crusade Against Junk Mail - New York Times

12/8/09 1:20 PM

According to the WildWest Institute, an estimated 100 million trees are destroyed each year to produce 4.5 million tons of junk mail, with 44 percent of that thrown away unopened.

GreenDimes keeps a crawl running on its home page, www.greendimes.com, showing that more than 310,590 trees have been preserved, more than 4 million gallons of water saved and nearly 1.6 million pounds of junk mail stopped by its efforts.

Mr. Shah, 34, decided to “chase lifestyle dollars instead of charity dollars” when he opened a parent company named Tonic in August 2006 using wealth he had acquired in the technology industry. He kicked off GreenDimes as Tonic’s first endeavor with only himself as a client when he found a stunning amount of junk inside his mailbox.

Today, GreenDimes has 16 employees who manage accounts for 50,000 members. Many of them signed up after the actor Matt Damon, who sits on the board, promoted the site on “The Ellen DeGeneres Show” and “The Oprah Winfrey Show.”

In August, the company retooled the Web site to attract a hipper audience by including more content on environmental matters in a section called W.T.F.? (It stands for Want the Facts?) The company expanded its charity choices beyond just environmental matters and has started a petition to create a national do-not-mail list similar to the do- not-call list created by an act of Congress in 2003. The Federal Trade Commission, which administers the list, reports that 148,471,508 phone numbers were signed up as of Aug. 31. As many as 300,000 are added weekly, the commission says.

Mr. Shah hopes to get enough signatures through word of mouth to take his petition to Congress. But staff members of the Senate Commerce Committee point out that junk mail was left out of the 2003 provision because it was considered less intrusive than phone calls or unwanted faxes. They further expressed doubt that a do-not-mail list would be created or would be upheld by the courts.

But hurdles have not stopped Mr. Shah from, as he calls it, “stepping on the gas,” to make GreenDimes more accessible and more competitive. The company — the name was based on the annual $36 fee, which amounts to a dime a day to stop junk mail — recently dropped its fee to $15 with a $5 rebate for referrals.

The price decrease was in part a response to other small businesses also promising to stem the tide of waste while contributing to environmental causes.

Last summer, three brothers in Ferndale, Mich., started 41 Pounds (www.41pounds.org), named for the number of pounds of junk mail the average adult receives every year. So far, 5,000 people have paid $41 for a five-year membership. The company, which recently became a nonprofit organization, donates $15 of that to environmental organizations.

The Web site, Stopthejunkmail.com, has 6,000 members and is run by a married couple in Boulder, Colo. It is the only company to provide the service to small businesses. Fees range from $19.95 for an individual up to $90 for a business with 25 employees. For every sign-up, Stopthejunkmail.com donates $1 to American Forests, a nonprofit conservation organization.

It is also possible to combat junk mail free. Web sites like www.ecocycle.org and www.obviously.com/junkmail will walk you through the necessary steps on how to deal with list brokers and other direct marketing firms that are not part of the Direct Marketing Association.

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For-Profit Crusade Against Junk Mail - New York Times

12/8/09 1:20 PM

For $1, you can also get off any new customer lists through the mail preferences of the Direct Marketing Association (The-DMA.org). The association says it accepts post cards, available from many third party organizations, that consumers can individually sign and send in with their $1. It is also in discussions with GreenDimes to accept the registrations of their individual members.

“To use an analogy, you can wash your own car or pay someone to wash it at a carwash,” said Stephanie Hendricks, director for public affairs at the association. “These companies are certainly complementary, doing things you can do. You’re paying for time and convenience.”

you can do. You’re paying for time and convenience.” Mr. Shah is gambling that a user-friendly

Mr. Shah is gambling that a user-friendly process coupled with a charitable ethos will attract more users around the globe. Tudor Investment, a venture capital firm based in Boston, recently invested $20.5 million in GreenDimes, according to Mr. Shah. Tudor declined to comment.

GreenDimes has completed a test for expanding to Canada and plans to offer its service in Britain as early as this fall.

Despite these expansion plans, Mr. Shah says he sees no reason junk mail cannot be eradicated by more than the 75 percent to 90 percent most companies promise, even if that means the end of a small business like GreenDimes.

“I don’t want this to be a small bet, meaning getting a few hundred thousand people signed up by next year,” Mr. Shah said. “I’d rather figure out how to get five million and make it viral and a little bit renegade. We actually are going to try to put ourselves out of business because the win in the end is that people actually have to ask for this stuff instead of getting it thrown at them.”

Correction: September 8, 2007

An article in Business Day on Thursday about companies that are trying to stop junk mail referred incorrectly to the business plans of two of those companies, Stopthejunkmail.com and GreenDimes. The two held no serious discussions about a purchase of Stopthejunkmail.com by GreenDimes.

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For-Profit Crusade Against Junk Mail - New York Times

12/8/09 1:20 PM