SAN FRANCISCO (03/31/2000) - E-Trade is expected to announce that Debra Chrapaty, the company's chief media officer, is leaving the brokerage to become president and COO of BigVine.com, according to sources familiar with the matter.
BigVine.com is a Redwood Shores, Calif.-based startup that provides an online barter marketplace for businesses to exchange goods. E-Trade spokesman Patrick DiChiro declined to comment, and a spokeswoman from BigVine.com did not return calls.
Chrapaty, who joined E-Trade in 1997 as its chief information officer, was responsible for running the company's technology operations through the brokerage's period of rapid growth in 1998 and 1999. She created the underlying architecture on which the company's operations now run. In October last year, the company brought in Joshua Levine, a seasoned Deutsche Bank technology executive, to replace Chrapaty as CIO. Upon his arrival, Chrapaty became the company's chief media officer, responsible for leading its digital financial media strategy. According to sources inside E-Trade, Chrapaty's move was widely regarded as a demotion.
Prior to joining E-Trade, Chrapaty was the chief information officer of the National Basketball Association. Technology is her area of expertise, and many in the industry heralded her efforts at E-Trade. In December 1998, Chrapaty was named CIO of the year by InformationWeek. Despite Chrapaty's efforts, however, E-Trade's systems were unable to keep up with demand, and its system suffered a number of significant outages in early 1999 as online trading traffic soared.
"Why else would the CIO of the year get demoted?" asks one E-Trade employee.
"We continue to have problems with capacity. It's obvious they felt she wasn't the best person for the job."
In her role as chief media officer, Chrapaty was responsible for turning CEO Christos Cotsakos's most recent vision, E-Trade's digital financial media initiative, into a reality. Cotsakos first announced this concept over a year ago, and the company has yet to announce any tangible products or services as part of it. Insiders and observers say the company was premature in announcing the strategy, as much of its implementation will be possible only when broadband technologies are widely deployed. Cotsakos hopes to push E-Trade's brand, products, services and original content across all types of media.
The company is launching an E-Trade magazine as a part of the initiative, and insiders say the company is in talks to develop a deal with Fox Entertainment, which counts Cotsakos as a board member. "E-Trade is the most aggressive company in the space," says Robertson Stephens analyst Scott Appleby. "What sometimes happens is they make premature announcements." Appleby, who was unaware of Chrapaty's departure, considers it a nonevent, citing the increasing numbers of executives who are leaving their posts for "additional wealth and riches."
One person close to Chrapaty says she has learned a lot at E-Trade and that she is ready to take on the challenge of running a startup. "E-Trade is where she started, but it's not where she's ended," the source says. "They have brought in a whole bunch of GE-type people. Debra is part of the first-generation E-Trade; she's not part of the gray-haired pedigree they've brought in. I think she's leaving on a high note." BigVine, which launched its services early this year, should offer Chrapaty a good chance to start over.
The company counts Kleiner Perkins Caufield & Byers, American Express and Bernard Arnault's EuropAtWeb among its investors. Member of its board include GlobalCenter CEO Leo Hindery, Robertson Stephens founder Sanford Robertson, Kleiner partner Vinod Khosla and Kohlberg Kravis Roberts executive Marc Lipschultz.