Thomas Krwawecz wants the adult industry to know he feels its pain. The 28-year-old chief executive officer of hosting and website services provider Blue Gravity Communications Inc. began his career in the adult industry in 1995 as a webmaster. He founded Blue Gravity two years later because, he says, he couldn’t find a reliable hosting company that was willing to provide his sites sufficient bandwidth. Some wouldn’t touch Krwawecz’ business at all because of the content he sold.
Today, Blue Gravity provides hosting for about 50,000 sites owned by between 3,000 and 4,000 companies and individuals who found themselves in the same situation. Seventy percent of Blue Gravity’s clients are adult businesses; the remainder is mainstream companies with ultra-high bandwidth needs. “We specialize in high-bandwidth clients, but we’ll host anyone at any level and with almost any budget,” Krwawecz says.
Blue Gravity continues to operate adult websites and an affiliate program, although the percentage of time and resources the company devotes to that end of its business has diminished progressively over time. “Hosting makes up about 70 to 80 percent of our business today,” Krwawecz says, noting that Blue Gravity owns somewhere between 600 and 700 domains “that we use for various purposes.” It’s this continuing elemental connection to the folks in the trenches that gives rise to one of the company’s guiding principles: “We don’t want our customers to go through the same pain we went through [in the early days],” Krwawecz says. “We’ve been through a lot. When a hosting company or a credit card processor goes under, people get nervous. After all, their livelihood is in your hands.”
Krwawecz remembers very well some of the most infamous flame-outs on the adult Web, although he really doesn’t like to reopen those old wounds. Thankfully, his company managed to weather the external storms that sank other entities. Part of the reason for that, he says, is “we’ve always invested in quality and reliability. We’ve always invested a lot of time and money in new technologies, trying to predict the future as accurately as we can so that everyone benefits. Our services never have been the cheapest, but we’re working to make them more competitive. We’re aggressively negotiating pricing with the major carriers in order to provide less expensive bandwidth to our customers.”
It’s both a blessing and a curse that the online adult industry “is completely different now,” Krwawecz says. “Remember when CyberErotica started the first affiliate program and paid 1 or 2 cents a click?” There was lots of money to be made during the Web’s early days, but lots of it disappeared mysteriously, too. To succeed in the 21st Century’s virtual marketplace, “you really have to focus on what you’re doing and stay one step ahead of the competition,” Krwawecz says. “In the past few months, we’ve really been focusing on refining and improving some of the back-end services we offer” so Blue Gravity’s clients will have the best, most detailed, most current information in order to take advantage of whatever opportunities arise. In addition, the company makes introductions between customers who can help each other with specific needs—say, for traffic, affiliates, business solutions, etc. Krwawecz says Blue Gravity’s philosophy is simple: When its customers prosper, it prospers, too.
What’s his best advice? “Back everything up. I’ve seen too many people lose their entire businesses to a hardware failure because they didn’t have a copy of their sites stored somewhere,” he says. “Everything we used to do by hand is automated now, which is great, but automation has its drawbacks, and those can destroy a business overnight. We’re very cautious around here, but no matter how careful you are, sometimes you can’t avoid a catastrophic hardware failure or a security breech.”
In 10 years, Blue Gravity has come a long way from the raw upstart founded by a still-wet-behind-the-ears kid who funded the endeavor with “$4,000, $5,000, $6,000 in bills every month” on his parents’ credit cards. Where will the future take the company? “We do the best we can to anticipate that,” Krwawecz says, “but if I knew the answer for sure, I’d be a rich man.”
