The Multimillion-Dollar Dash

Dressed in familiar baggy jeans and a baseball cap, corporate CEO Darien Dash is preaching the gospel of the Web to a crowd of teens at the Alexander Hamilton housing projects in Paterson, N.J. Knowing that for many of these kids the closest model of financial success is the local drug dealer, this 29-year-old dotcom entrepreneur speaks to them in language he knows they understand. "The new hustle," declares Dash, "is technology."

For the past six years, Dash's life has been all hustle--a constant struggle to make it in the New Economy. Last year he became the first African American to take a dotcom public. The mission of his DME Interactive Holdings Inc., based in New York City, is to help urban youth join the technology revolution by providing them with hardware at a cost they can afford--and make some money for himself and his investors in the process.

DME's original business plan was two pronged. First, it would offer business-to-business Internet services, including the development of e-commerce sites. Next, it would help minority consumers get connected and create website content targeted at them. Then reality caused Dash to change course quickly. Before he could sell the consumers websites, Dash needed to go back a step: turns out that a lot of inner-city African Americans still didn't own computers. So DME's new goal became filling that need by selling low-cost computers in the urban marketplace, in effect acting as general contractor in the project to build a bridge over the digital divide.

The venture capitalists, however, weren't buying into Dash's new vision, leading him to seek his capital elsewhere. In June of last year, DME acquired an ailing auto-leasing company called Pride Automotive, which gave him some old-economy collateral--good enough to raise $1 million through an investment bank.

Meanwhile, he managed to capitalize on some good publicity his project was generating, as well as some big-name corporate connections. For Dash personally, it led to a White House invitation, while DME was named the minority technology firm of the year for 1999 by the U.S. Department of Commerce. When he took DME public last June, Dash's net worth reportedly shot up to $30 million--on paper. Then last spring, when Wall Street soured on dotcoms, DME fell on hard times, and investors scurried away. Dash weathered the storm, but DME was forced to lay off more than half its staff. A plan to sell $249 PCs, with free Internet access in New York and New Jersey through a subsidiary, Placesofcolor.com , went ahead. But DME's hopes of providing urban-oriented content had to be put on hold.

What Dash has discovered is that this bumpy path to dotcom success is littered with many of the same obstacles faced by African Americans in the traditional corporate world. Only in this case, he faced a new-boy network, made up mostly of white, middle-class male computer engineers mixing comfortably with M.B.A.s--guys who often knew one another as undergraduates. "Back in 1997, it wasn't cool to be a black dotcom," says Patrick McElroy, president of Atlanta-based EverythingBlack.com , a virtual meeting ground for more than 600 African American-owned websites. Dwayne Walker, 39, a veteran of Microsoft who runs Seattle-based ShopNow.com , recalls the visible discomfort of white venture capitalists in 1995, when he was seeking backers for his site, which links 100,000 merchants with consumers. When people met him in the flesh, Walker says, "there was always the initial, 'Oh, he's a black guy.'"

When Dash was growing up in New Jersey in the 1980s, there weren't many black role models in corporate America. Today, while some 200 black men and women have reached the upper echelons of FORTUNE 500 companies--up from a handful a decade ago--only two African Americans have ever been named CEO of any of these firms: Kenneth Chenault of American Express and Franklin Raines of Fannie Mae. Prominent blacks like Maytag's Lloyd Ward have resigned or been relieved of their corporate commands. In the Internet world, the minuscule number of black chief execs was prominently diminished last month when Robert Knowling was ousted as CEO of broadband provider Covad.

Dash wanted to bolster this tiny club--by adding at least one, himself, to their number. While a freshman at the University of Southern California, he launched a successful hip-hop record label. When the Internet began to take off, he used the profits to start DME. He self-financed the company for the first 4 1/2 years, raising a couple of hundred thousand dollars from family and friends.