How To Find The Hidden Value
BARRY DILLER, chairman, InterActiveCorp
By Duff McDonald

(Business 2.0) – You ran the Fox movie studio and were always considered a major player in Hollywood. So when you took over the Home Shopping Network and a handful of piddling websites, people viewed it as a strange move. Now IAC is a $6 billion company. What did you see that others didn't?

For me, the guiding principle in deciding which route to take in business has always been to follow my own curiosity. Of course, you also need a willfulness to make real, practical use of that curiosity. The one doesn't work without the other.

With respect to InterActiveCorp, I was intrigued by the computer. And it led me, three years before the Internet really took off, to get involved in what was then a primitive convergence of sorts. One step followed another as the world radicalized around us, ultimately offering us opportunities that we couldn't have even considered taking in the past, as they were nowhere in sight. So it was curiosity—and serendipity—that opened up some opportunities in interactive commerce, and we capitalized on them. When we considered our choices, we knew that there was no right or wrong. There was just our instinct.

Yet at the same time, I was also quite curious about people who would come to us saying, "We're going to be the leader in this space, and be the first one in, but we won't make any money because we're going to sell things for less than they cost us." My training came from the retail business, which taught me that you should look for opportunities that have solid gross margins in them. I've tended to stay away from those that don't.

The healthiest thing in the world is to be discounted. If you're curious enough that no one thinks what you're doing makes any sense at all, then they'll leave you alone. If everyone is skeptical, you can concentrate and stay focused. And curious. — D.M.