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September 21, 2005

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Publication Date: Wednesday, September 21, 2005

Group has $500,000 ready to invest in Kepler's Group has $500,000 ready to invest in Kepler's (September 21, 2005)

** Investors would own 70 percent of store's shares if negotiations with landlord result in bookstore's reopening.

By Rory Brown

Almanac Staff Writer

A 17-person patron's group is ready to play a major role in reopening the doors to Kepler's Books and Magazines in Menlo Park. But like former employees, customers and supporters, the investors can't help Clark Kepler's store until negotiations are reached with the site's landlord, the Palo Alto-based Tan Group.

The investors, self-labeled Kepler's "patron circle," have pledged more than $500,000 toward saving the bookstore, said Anne Banta, the new chief marketing officer for Kepler's.

If and when Kepler's is back in business, the investors will own 70 percent of the store's shares, but Mr. Kepler will be the largest single shareholder, owning the remaining 30 percent of shares, he said in a conference call.

"I'm incredibly pleased with the support from the investors," said Mr. Kepler. "All of the store's everyday operations will still be in my hands. I'm receiving a lot of help from the community, from my neighbors, and it's still Kepler's -- it's still in the family."

Mr. Kepler abruptly closed the store at 1010 El Camino Real on August 31, blaming the economic downturn.
Tan Group

All the new plans still hinge on negotiations with the Tan Group.

"The Tan Group has our proposal," said Mr. Kepler. "We don't have a specific date where we need a deal, but I have a staff waiting, and relationships with vendors to maintain."

"Hopefully, we will reach a deal this week, and start turning pledges into much needed money for Kepler's," said Daniel Mendez, the founder and coordinator for the patron's circle.

Co-founder and vice president of Visto Corp., a Redwood City technology company, Mr. Mendez is one of five people on the newly established board of directors for Kepler's.

In addition to Mr. Mendez, there are three other members on the board: Geoff Ralston, an Atherton resident and chief product officer at Yahoo; Bruce Dunlevie, a general partner at Menlo Park-based Benchmark Capital; and Mr. Kepler, who will serve as president, CEO and chairman.

Like Mr. Mendez, Mr. Ralston and Mr. Dunlevie are members of the 17-person patron's circle.

There are several applicants for a remaining seat on the board, said Ms. Banta. The board is looking to add a member with extensive experience in the book publishing industry, she said.

Others who will work closely with the new board of directors include Mitch Slomiak, a Menlo Park consultant who will serve as chief financial officer for the bookstore's long-term business plan, and undisclosed law firms that will provide services, said Ms. Banta.

In addition to heading marketing operations for Kepler's, Ms. Banta said she will work pro bono for the store.

"After a [lease] agreement is reached, we've got to pay back the debt to publishers, and start buying books," said Ms. Banta. "We need to establish a long-term marketing program and new sources of revenue."

Ms. Banta said she hopes one source of revenue will be a Kepler's membership program. She noted there is plenty of support for Kepler's as has received more than 20,000 hits in less than three weeks.

Establishing specifics for the program is the "next step" following successful lease negotiations, said Ms. Banta.

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