Less than a year ago, Patrick and Alain Hanash had barely $2,000 invested in their fledgling Internet company, a basement for office space, and two employees: themselves.

Now, their Vienna company has just secured a second round of $15 million in brand-name venture capital from Draper Atlantic and Grotech Capital Partners. What groundbreaking business innovation do they have to be commanding that kind of attention so early?

Chatrooms.

That's right. The same kind of communication channel that has been around since the Internet was born, the original "sticky application" that brought fame and fortune to AOL, Yahoo!, Geocities and legions of also-rans too insignificant to count.

It may seem that, as far as new business ideas are concerned, the chatroom is such trampled ground that no one would care. But the brothers Hanash have found a compelling new angle on the chatrooms that was somehow overlooked by the giants: an international network of users who communicate across cultures and commercial boundaries.

"Everybody talks about the globalization of the Internet, but we still haven't seen any traces or hint of the Internet being a truly global medium," Alain Hanash explains impatiently.

To address that problem, the 29-year-old graduate of Cornell's computer science program left the security of his consulting job at Ernst and Young and founded Multicity.com in July 1998.

Enlisting his 31-year-old brother Patrick, a former financial consultant, they started a chat service that simply allows anyone with a website or homepage to plug into Multicity for free. The result, according to Alain, is a sprawling network that spans 60,000 sites and homepages in 20 languages around the world, achieved entirely by word of mouth in less than a year and a half.

"The idea is to create a network that's not closed. The Internet itself is a very open medium. It's not a closed entity. Yet most of the companies that you see on the Internet, including AOL, are private, closed, American companies. The idea was to create something that's more open that allows people to participate in the creation of the network," Alain Hanash says.

With a Lebanese father and French mother, and an upbringing in France and the U.S., the Hanash brothers preach cultural diversity and breaking down ethnocentrism. When describing the business opportunity, they almost sound like revolutionaries attacking the domestic influence of the American entertainment industry.

"Because we have lived everywhere, we realized that it's not just the Internet companies that are concentrating only on the American market," says Patrick Hanash. "Americans are not really looking to the outside. For example, in France the [pop music] top 10 has songs from France, U.S., Italy. Here it's very limited to American music."

"Its social change that we want," adds Alain Hanash.

Even so, the Hanash brothers are counting on advertising revenues from American movies and music attracted to their global "eyeballs." According to most estimates, non-English speakers will outnumber English speakers on the Internet by 2003.

Companies of all types are beginning to realize the potential of Internet advertising to reach those audiences at costs much cheaper than traditional marketing, and investors agree that they are tapping into an underserved audience.

"The essence of the Internet is global and open and Multicity embodies that," says Jim Lynch, a partner at Draper Atlantic who led their first funding deal. "The size of the market opportunity they represent is huge."

The appeal of the Multicity message was so apparent to Lynch and the other partners at Draper Atlantic that they offered Patrick and Alain Hanash $1 million in first-round financing 10 minutes after the brothers pitched the company idea to them. A few months later, they wowed the crowd at the annual Mid-Atlantic Venture Association fair in November 1999. Frank Adams, one of the chairmen of MAVA and founder of Grotech Capital Partners in Timonium, approached Alain as he stepped off the podium. Grotech offered to lead a second round of $15 million within days.

"Frank really saw that they were the belle of the ball," says Lynch.

Unlike most other Web start-ups, Multicity isn't eager to toot its horn until the time is right.

Recently the plain-looking site was not yet adorned with the various high-tech tools the Hanashes have at the ready, including a program that instantly translates typed chatroom messages into other languages, and another secret tool they are waiting to get patent approval for.

Patrick Hanash says the brothers have not talked too much about the company "because we are paranoid basically. We are in stealth mode and we wanted to build the network up before people see the potential."

They also dismiss the hype and valuation craze that seems to accompany most high-flying Internet start-ups these days, especially with the Nasdaq's January dives.

"With these companies, the main reason for creating that buzz is less for building the company and more for an IPO or to get more money into the company. We haven't spent a dollar either on marketing, promotion or anything like that. For us, its actually trying to build a business and fundamentals," Patrick Hanash says.

With so much money in the bank, the brothers are looking for an experienced management team to focus on growth beyond their current employee count of eight, no matter what the financial atmosphere is.

"We think the bubble will burst, and its going to be fairly soon," Alain Hanash says. "We still want to be here, a big company, that will have an impact on a social level and also on the vision of the Internet and where its moving."

Copyright© 2000 Post-Newsweek Business information, Inc. All Rights Reserved