A Business Initiative for Knowledge Distribution*


The modern world exposes us to an increasing amount of information; this applies to our private lives as well as to the business environment. We are both the receivers and the generators of this information. Modern information technology (IT) has so far developed many more tools and applications for receiving (i.e., searching for) information than it has for generating it. However, the added value for the commercial mediating of information can be much higher than the added value of, the now already traditional, information industry – users could save a lot more time by having access to the intellectual output that enables them to submit their information to appropriate addresses (using many kinds od smart e-forms) than only by being able to search for information, which is often only the first step of the working process.

Our intellectual activities are not always unique and innovative: very often they are routine tasks that require a lot of repetition and, as a result, a lot of time is required for the same mental processes. So, apart from the "passive" information that is obtained with the help of the traditional IT industry, users should also be able to access an archive of "active" information that can support their various intellectual tasks that are performed in their private and business lives. As a consequence of being able to skip these routine tasks, users would then have additional time for more important and more creative activities. As a result, their productivity would increase – and they would be prepared to pay for access to easily available and useful applications much more than they would for passive information.

These observations are already reflected in various types of business initiatives and can be found on the web (various forms, templates and other tools), but they seem to have been created rather randomly and fractionally. So far they have not yet appeared as a well-planned, well-rounded attempt to set up a new industry of knowledge exchange using the latest IT–web technology. Focusing on a specific way of bringing together the authors and the users of knowledge who are active in all fields of human activity will result in a commercial advantage: those who manage to design, for the first time, an appropriate business model and set up a network allowing a well-planned and monitored exchange of knowledge will be entitled to an appropriate fee for the resulting services. If we succeed in setting up such a model in a country with a relatively small market (like Slovenia with 2 million inhabitants) we can later, in cooperation with appropriate, large foreign partners, offer a similar model to international markets.


This type of investment is relatively risky as it focuses on an entirely new service that attempts to satisfy (newly developed) needs that no other commercial entity has so far addressed in this way.  At the same time this particular commercial niche represents an area that has not been covered so far, and offers the first investors an important time advantage and an opportunity to create a position that could lead to a permanent advantage over competitors, who will surely appear at a later stage. Observing the initiative from a broader perspective, we can define our ambitions in the following way: after developing a new business model and the supporting information platform operating in the test environment of a small market, we could later attract large, foreign strategic partners to invest into various forms of partnership (setting up similar companies in larger markets), or even (preferably partially) sell our company to an interested multinational firm. In the case of a successful realisation of our aims, the returns on the investments could be significantly above average.

Form of Operation

Though this business initiative could be realised within an already existing company, I suggest that we set up a new company. This will allow us to emphasize the very specific nature of the operation (strongly web orientated) during the initial setting up of its organisation, and, at the same time, set up healthy and modern relations among the company holders (founders, managers and employees).

At the beginning it will be necessary to provide the following:

  1. finances
  2. staff
  3. authors

ad 1. We would need to obtain an appropriate amount of initial funding that would allow us to implement the BETA version on a free-of-charge basis and promote the company for a considerable period of time. In doing this we should not let ourselves fall into the trap of thinking: "Once our users are used to getting our services free of charge or at a low price we will not be able to increase the prices at a later stage". On the contrary, our thinking should be the following: "Our solutions will be so good that the demand for them will grow rapidly in the first, free-of-charge period, after which the users will not want to do without them and will be prepared to pay a fair price for them".

ad 2. We will need the right combination of senior staff with the required business experiences and young people with fresh ideas and imagination and the courage to try out new ideas (e.g. emphasizing the need to work from home!). The principal company holders, especially the managerial staff, should demonstrate a high degree of loyalty to the company and its long-term goals. We need to find a solution that will assure the founders (mainly the investors) that the value of the company will be continually increasing as a result of the creativity and the motivation of all the staff, and, at the same time, offer options of shared ownership (or at least participation in the long-term profits of the company) to all the participants.

The new company will employ three types of staff members:  a) those needed for the smooth operation of any company; b) developers of the specific software needed for managing knowledge distribution – artificial intelligence; c) content editors, who, as a rule, will not be the authors, but will act as the mediators between the authors and the information system, as well as information-system designers and holders.

Ad 3. As the founding, organising, equipping and technical start up of the company will take up a lot of time, it would be very profitable if we can also use this time for attracting external cooperators, experts from various fields, who will, on the basis of agreed content and work relations, create the first, and the most promising, documents. Once the information scientists and developers create the first technical solutions we will be able, at an early stage of our operation, to test the first documents with potential users.

Our relations with the authors will have to be defined in a few standard types of contract that take into account specific forms of cooperation. In some cases the authors will receive payments immediately and will transfer their copyright entirely to the company (this will mainly apply to the creation of templates). In the cases of more demanding web applications (procedures), which will also require regular updating, it will be more appropriate to stimulate authors for long-term cooperation (a continual assurance of high quality) and offer them a share in the income. However, in the cases where we cooperate with various institutes and other large business partners we will have to make specific contracts or general agreements.


Right from the start our new company will be introduced as an entirely new and modern operation based on (the real) new economy and an innovative, web-oriented information technology. The company will be called:


Knowledge Distribution

It will cover the following services and activities:

-         the provision of a web-based information infrastructure for the purpose of knowledge exchange between authors and interested users;

-         the creation, installation and maintenance of various templates and procedures available on the internet;

-         the development and maintenance of the technology used for direct communication between providers of different intellectual services (counsellors, experts, valuators, translators, lawyers, notaries, independent authors) and their clients;

-         the research, development, implementation and maintenance of various web-based forms, with a special emphasis on e-administration and e-government; 

The company is expected to generate its income in the following ways: a) directly from the end users, who will pay for the services offered at a special central web page such as "Get any help you need here" consisting of templates and procedures available at very low prices; b) commission from the fee for services provided, via the web applications, by external authors, counsellors, experts, valuators, translators, lawyers, etc.; c) for large projects or business with state institutions or other bodies in the area of e-administration.

Cooperation with the external partners

The operation of the new company will be based on high-quality products. For this reason it is important to set up, right at the beginning, good and trusting relations among all the professionals who will contribute their knowledge. We should pay special attention to the following expert groups:

  1. individual authors
  2. non-economic entities
  3. economic entities
  4. groups of professions

ad 1. At the beginning our most valuable collaborators will be individual professionals, mainly those that have already been recognised as experts in their respective fields and have published their work in journals and/or books. Some of them (the best individuals) will have to be persuaded that, by using the latest web technology and in cooperation with our company, they can earn considerably more than on their own. It is of course inevitable that other authors (their competitors) will make less money (and so, probably, will various publishers of technical literature), but this will be a result of their slow acceptance of new technology and new business models.

Example: Why have so many books been published in the area of legislation relating to employment relations (including the disciplinary measures) together with commentaries, interpretations, sample contracts, case studies, etc? The reason for this situation lies in the fact that in the past there was no internet, which now allows us to keep all the best solutions in a single place, update them regularly, adapt them to the changing legislation and make them available any time when users urgently need help. We can predict that a rational use of the internet (using its various sites or just the most reliable ones) will significantly reduce the number of printed copies of various manuals.

Ad 2. Various institutes operating within university faculties represent interesting potential partners, as they have already shown a high degree of commercial ambitions, though, due to the nature of their financing (partly public), they are often limited with regard to direct advertising and attracting new clients when trying to gain additional income for the employed teaching staff. At the beginning of any such cooperation it will be necessary to make general partner agreements, followed, at a later stage, by executive contracts based on the agreed ways of sharing the income or commission.

Ad 3. With regard to cooperating with economic entities, at least at the beginning of our operation, we cannot expect any relevant commercial outcomes, as we will act as their competitors, and the providers of entirely commercial consulting services will not be prepared to share the pie with a newcomer in the field. We will attempt to attract these entities at a later stage by offering them our newly developed information technology and/or web applications, which will allow them to reduce the charges they make to their customers. Their mistrust will fade as soon as they realise that our new company does not provide products with competing content, rather we will provide technical help with the use of web applications.

Ad 4. The most interesting area will be our relations with lawyers. According to European legislation, lawyers cannot advertise their services. However, they have to promote themselves to their potential clients (recently, they have been increasingly doing this through their web pages). But if, in doing this, their promotion appears commercially attractive, they are immediately accused of being unethical. Thus, it is obvious that lawyers are keen to cooperate with anybody that can provide them with new clients. Our new company, acting as a knowledge distributor, will also find it easy to "advertise" those intellectual services that can only be provided by lawyers – those, who will be actively cooperating with our company.

This new model of operation might lead to another interesting consequence concerning lawyers (though not positive for everybody): the web will enable us to obtain (create) a number of documents based on various templates (contracts, last wills, settlements, applications, etc) that will be cheaper than the documents obtained directly from lawyers. It will soon become clear that not all the services provided by lawyers are real legal advice, and that they generate a lot of income by simply providing administrative services that can, in everyday practice, be done by their secretaries. No law forbids non-legal persons from preparing their own documents (even legal ones) or from obtaining help from other non-legal persons if they can, in this way, save some money. As a consequence, some lawyers might make less money by doing routine tasks, but they will have more time for the provision of real legal assistance (remember that everybody is entitled to legal counselling!). However, some lawyers (probably the young and computer-literate ones) will be able to earn more than they have been earning so far if they get in touch with our new company and participate in the preparation and updating of templates. The results of such cooperation will be beneficial to everybody: the productivity of the lawyers will increase and the costs of the end users will decrease.

Example: According to a modest estimation, a well-organised company can "relieve the lawyers of routine tasks" to such an extent that its income from such services is approximately 10% of the income of all the lawyers operating in any market.

Taking into account the specific nature of their work, similar collaboration will have to be set up with other professionals, mainly with experts, valuators and translators.

Knowledge database

All the specialists in IT agree that the future of a modern IT service lies in its content ("Content is King"). Only the companies that can collect and manage large amounts of information will achieve long-term success. 

The operation of IN-FORM Ltd. will be based on the continuous collecting of high-quality knowledge, which will, of course, also have to be appropriately selected and updated. In this way the company will become an increasingly important reference source as well as a potential partner for several other economic and non-economic entities, while its value will continually increase due to the constant expansion of its accumulated knowledge base.

Ljubljana, 23. 1. 2003                                                                        Anton Tomažič

*The above initiative has been well received in Slovenia, where, on 13 June 2003, 20 partners set up a company, named INform Knowledge Distribution Ltd., and started to realise its goals. Most of the efforts have been focused on the development of the specific software needed for the interaction between users and authors. They will meet at a special portal, where the authors will make use of a web editor to prepare templates and procedures, while the users will be able to access applications at a very low price.