Voiceglo (TGLO-OTC: BB)
Interview with:
Edward A. Cespedes, President
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Voiceglo is offering the fastest way in the world to a working U.S. telephone number

Computer Services


110 East Broward Boulevard Suite 1400
Fort Lauderdale, FL 33301

Phone: 954-769-5900

Edward A. Cespedes

Interview conducted by:
Lynn Fosse, Senior Editor
March 10, 2005

Edward A. Cespedes, President

Edward A. Cespedes has served as the president of theglobe.com since June 2002 and as a director of theglobe.com since 1997. In 2002, he co-launched its subsidiary,   Voiceglo, a Voice over Internet Protocol (VoIP) communications company, and currently serves as its president. Mr. Cespedes is also the president of E&C Capital Partners, a privately held investment company. He also previously served as the vice chairman of Prime Ventures, LLC, from 2000-02. From 2000-01, Mr. Cespedes served as the President of the Dr. Koop Lifecare Corporation and was a member of the Company's board of Directors. From 1996-2000, Mr. Cespedes was a Managing Director of Dancing Bear Investments where he had primary responsibility for all mergers, acquisitions, and capital markets activities for Dancing Bear and its portfolio companies. Prior to joining Dancing Bear Investments, Mr. Cespedes was the director of corporate finance for Alamo Rent-A-Car. In the late 1980’s and early ‘90’s, he worked in the Investment Banking Division of J.P. Morgan and Company, where he focused primarily on mergers and acquisitions. In his capacity as a venture capitalist, Mr. Cespedes has served as a member of the board of directors of various portfolio companies. He is also the founder of the Columbia University Hamilton Associates, a foundation for university academic endowments. In 1988, Mr. Cespedes received a bachelor's degree in International Relations from Columbia University.

Company Profile:
Headquartered in Fort Lauderdale, Fla., Voiceglo (OTCBB: TGLO) is a global communications and networking company. A subsidiary of theglobe.com (www.voiceglo.com), Voiceglo provides award-winning communications services to thousands of customers worldwide via broadband or dial-up connection. Voiceglo's strategy is to provide easy access to Internet phone services for consumers and businesses worldwide to make local, long distance and international calls at rates lower than traditional telecommunications companies. Voiceglo's products include the GloPhone (www.glophone.com), a Web and PC-based phone that enables users to make calls while online; GloPBX, a next-generation wireless communications system that turns wireless routers into virtual PBX systems; and GloConnect (www.golconnect.com), a new overlay application that interacts with Web messengers and allows instant messaging (IM) users to communicate across all IM platforms using advanced IM, e-mail and voice functions.

CEOCFOinterviews: Mr. Cespedes, what was your vision when you started Voiceglo, and how has that developed for you?
Mr. Cespedes: "When we started Voiceglo, our view was that the internet was a more efficient means to transfer voice and for that matter, anything else. We realized right away when we saw the business plan that in the future, and it is already happening that the internet would be basically and virtually the only way that voice was moved around the world in the future. We wanted to build a company that would be in position to take advantage of that new economy. That was the genesis of Voiceglo. Once you have determined that the medium is right, the question becomes how do you let people access the medium. We realized immediately that the wrong way to do it was to get right in the faces of the big phone companies, so we developed a desktop solution that is known as GloPhone. It is going well so far. We are at about three million desktops throughout the world and we have paying customers (although still small in numbers) in around ninety countries. That means that people all over the world are getting and using U.S. and Canadian phone numbers courtesy of the GloPhone Network."

CEOCFOinterviews: How have you gotten to these three million desktops and how do you get on more?
Mr. Cespedes: "The three million have come from a combination of partnerships marketing and word-of-mouth. Part of the benefit of having the GloPhone, is you can talk to any other GloPhone in the world free. Someone like you gets the phone and their first call is to somebody else, and they encourage them to get the phone so now they can speak free of charge. Aside from the value asset, partnerships have been important. VOIP is very hot right now; it is not much different than the internet was in 1988 or 1989; it is something people are watching and it is the next big thing. Many people want to play in it that don’t have necessarily the expertise of being a VOIP company. That is why we have some partnerships. We have been able to partner with Office Depot (NYSE: ODP) and others. We leverage those partnerships as well for new customers. Going forward, I think with any product that starts free and is as cheap as fifty bucks a year for phone service, the key driver of a product like that will be word-of-mouth and the key driver of word-of-mouth advertising is having a good product that works every time. We continue to improve the product and add features and functionality to it. We just launched in BETA something called GloConnect, which enables people who use instant messengers, to turn those instant messengers into fully functioning phones. That is how we plan to grow, by continuing to improve the product and thereby extending the market."

CEOCFOinterviews: What do you need in-place in terms of infrastructure to make this happen?
Mr. Cespedes: "It is very small. This is the advantage of the business model compared to what we will just call Legacy voice systems. I have spent in the lifetime of Voiceglo, on infrastructure, probably less than $20 million dollars and maybe less than $15 million. We offer phone service or voice service in virtually every area code in America and Canada globally. When you compare that to Bell South for instance, they offer area codes in the southeast part of the United States, they have 100,000 employees and literally billions of dollars invested in their infrastructure. The 10 or $15 million that I have invested so far would virtually represent most of their required investment until we surpassed millions of customers. What that does, and you see it already is it enables us to offer our services extremely cheap. With us you can literally get a working U.S. telephone number with the minutes included for $49 dollars a year or as little as $4.99 a month. All of these efficiencies in our infrastructure translate to consumer savings."

CEOCFOinterviews: You mentioned the U.S. phone numbers availablity; are people outside the U.S. looking for that, and how important is that on  a global basis?
Mr. Cespedes: "It is extremely important and yes, they are looking for it. In the United States, the 290 million people, 49 million like them are like me; I am a first generation American. My parents come from Peru. There are 49 million people in this country that are either immigrants like my parents or first generation Americans like myself, who have a couple of things in common. The first is they speak a second language equal to or better than they speak English and in my case it is Spanish. They still have a significant portion of their family, friends, and professional relationships etc., outside of the country. There is a tremendous demand for voice service among those 50 million people just naturally. What happens in the case with my family,   which I will use as an example, is my grandmother in Peru has a local Florida number to my mother in Fort Lauderdale. What used to be $400 dollars a month in calling card costs for my mother is now free and they talk ten times as much.

It turns out that there is quite a bit of demand for U.S. telephone numbers outside of the U.S. The cheapest international long distance minute in the world, originates in the U.S. and terminates outside of the United States. I can deliver a call from New York to London, for four cents a minute or less; a call from Paris to London might be eighty cents a minute. That Parisian who calls London frequently, by getting a U.S. based GloPhone, now spends four cents a minute to London instead of eighty cents. It has a very powerful toll by-pass aspect to it as well. It is important to know that when you think of markets in the world and economy, you usually are driven right to the United States as a sort of growth and ability to absorb new products. There is absolutely no reason why we couldn’t or wouldn’t provide phone numbers outside of the United States as we got critical mass in-place. We are looking at adding numbers in the U.K. and Mexico as regulations there free-up a bit. It is just a matter of deciding where it is important to have local numbers. Right now, the U.S. numbers are very effective marketing tools."

CEOCFOinterviews: How does a company get numbers?Mr. Cespedes: "We contract with between twelve and fifteen major tier one and tier two carriers such as MCI (NASDAQ: MCIP) and Global Crossings Ltd. (NASDAQ: GLBC). They have exceptionally cheap networks available and have all been through bankruptcy etc., and there is a massive over-capacity. We get numbers from them and we do that by buying circuits from them and that is how we are able to provide numbers anywhere in the U.S and Canada."

CEOCFOinterviews: It is a popular space that you are in; will you tell us about your competitative advantage?
Mr. Cespedes: "We think of competition a little differently than you might imagine. We have never once felt that the competition was all of the new VOIP companies coming to market. There are what seem to be ten new ones everyday. We are very aware that the competition or existing phone companies, cell phone companies and cable companies, not because they can do VOIP any better than we can because they cannot, but because they have all of the customers. Everybody in America has a cell phone, and most people in American still have home phones. The challenge for us in terms of competition is, that is who we are up against. You cannot turn the television on without seeing the 'can-you-hear-me-now' guy from Verizon or that strange sprint guy in the trench coat from Sprint. Those are the kinds of dollars and competitors we are up against. They are also the ones that are most at risk because it is very hard when your base product is on average fifty bucks a month. You have tens of millions of customers and you all of the sudden wake up one day and say I am going to be in the five dollar a month phone business to compete with voice club. We are in an interesting space. The reason there is a lot of entrance is because it is among the biggest markets in the world and the Legacy players cannot move swiftly enough to adapt. We have positioned our company to compete with them but also to be able to work with them as partners if necessary. Where we are different from some other players that have come to market and said, instead of paying fifty bucks for your phone service, you can have ours for twenty-five bucks. We are on a desktop, we are global where five bucks a month is free and we think that is a win for us."

CEOCFOinterviews: Where are you free and how does that work for you?
Mr. Cespedes: "We are free for anyone who goes to glophone.com and downloads a GloPhone and that encourages anyone someone else to dial at a GloPhone so they can speak free. Any GloPhone user anywhere in the world, without paying us a dime, can speak free to any other GloPhone user anywhere in the world. How we make money off that is, in about the second half of this year we will begin to overlay an advertising model on that. For example, this call from me to you has been a GloPhone to GloPhone call; prior to completing the call, I would have heard a message like this; this free Glo Phone call proudly sponsored by Coca Cola. That would be the only advertisement you would hear, and then that call would be monetized that way for the company. It is very appealing to consumers because it is not so disruptive, and I am not forcing you to hear a one minute ad or I am not forcing you to answer six questions about who you are and how much money you make. It is a simple, non-intrusive advertisement that takes a few seconds."

CEOCFOinterviews: What happens when you are not in front of your computer?
Mr. Cespedes: "You don’t have to be in-front of your computer. We have in our lap now what we call Wi-Fi phones and probably in the second half of this year you will begin to see the first of what are called combination Wi-Fi cell phones. When you are in a Wi-Fi hotspot, you would automatically default to the GloPhone. A bunch of companies are competing in the Wi-Fi space to get Wi-Fi out there and that will be more prolific as time goes by. We have all kinds of call forwarding features so if I want to forward my GloPhone to my cell phone that is easy to do. Mobility in wireless is the future. We work with all Wi-Fi devices and we will be very mobile as time goes by. We are new so we announce new products as fast as we can; we have to make sure they work right and there is a little development cycle."

CEOCFOinterviews: I see you have won a fair number of awards; what does that mean for Voiceglo?
Mr. Cespedes: "If you just go to Google and do a search on voice-over, I am sure you will probably come up with thousands of names. To try and differentiate yourself in a crowded space, is difficult. The awards, and especially the awards that make their living from analyzing industries like Frost and Sullivan, a global leader in growth consulting and some others, helps to legitimizes us. If anything else, it helps in the sales process. Other than that, it is nice to win awards. We don’t put a lot of stock in them; we don’t walk around wearing medals or anything, but it is important. It is important from a public relations perspective, from a legitimacy perspective and certainly internally. It helps with moral and lets our staff know that we are doing something meaningful."

CEOCFOinterviews: You are part of a public company; will you tell us how you are funded for the development that is ahead?
Mr. Cespedes: "Voiceglo is 100% wholly owned subsidiary of The Globe.com, of which I am also the president and my partner and I control. We have market capitalization of somewhere between 70 or $80 million today; I think the company is worth a lot more than that. We have been funded by ourselves; my partner and I have put our own money in. We have also raised some outside money from some very sophisticated investors; large funds. We also own another subsidiary called SendTec, and that is a profitable business that helps us fund the company internally."

CEOCFOinterviews: What should potential investors know that they might not realize when they look on the surface?
Mr. Cespedes: "I think what they should know that an investment in our company should be looked at as a high-risk/high-reward situation. They should know that my partner and I are seasoned businessmen whom have lived through ups and downs and we really do look at this as a business that we think we can create a lot of value. They should also know that when they make an investment in our company, risky as it is, it is right next to our investment in the company, and that we have millions of our own dollars at risk here. We have not sold a single share since we took over the company in June. Secondly, despite all the noise in VOIP, we are still just at the beginning. VOIP is now sort of where the internet was in 1998. We don’t know how it is going to play out for sure. In 1998, we certainly understood that the internet was going to become an imbedded, important, and critical part of everyday life. That turned out to be true. We are certain that voice-over internet will be the majority of voice traffic, just do to pure efficiency in the future.  How people access networks, who the winners and losers are, is still very much in question and with that comes a lot of risk. We are very up-front with our investors all of the time. We are not in this for ten cents but for ten times or one hundred times the money. If we hit it right, that is what it is worth and if we hit it wrong, there are many other players out there. I think those are the things that are readily apparent."

CEOCFOinterviews: In closing, what would you like our readers to remember about Voiceglo?
Mr. Cespedes: "I think that what readers should remember about Voiceglo is that it is a global company and that in the midst; we actually call it the fastest way to a working U.S. telephone number in the world. Someone sitting in Paris, can log on to glophone.com and have a working U.S., New York City phone number in less than three minutes. That is unparalleled anywhere in the world and no other company can do that. There is no equipment required. All you need is an internet connection, dial-up or broadband. That is the message it is a sort of instant global telepathy. You don’t have to wait between 12:00 and 5:00 for the phone guy to show up; that is the message."


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"I think that what readers should remember about Voiceglo is that it is a global company and that in the midst; we actually call it the fastest way to a working U.S. telephone number in the world. Someone sitting in Paris, can log on to glophone.com and have a working U.S., New York City phone number in less than three minutes. That is unparalleled anywhere in the world and no other company can do that. There is no equipment required. All you need is an internet connection, dial-up or broadband. That is the message it is a sort of instant global telepathy. You don’t have to wait between 12:00 and 5:00 for the phone guy to show up; that is the message." - Edward A. Cespedes


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