• Uncorking-e-commerce

Uncorking e-commerce

Posted on November 5, 2018

Learn how the e-commerce revolution started in December 1994 when a small business worked with Wells Fargo to process credit card purchases online for the first time.

Marianne Babal
Marianne Babal is a Corporate Historian for Wells Fargo.
Aubrey Carrier
Aubrey Carrier is an Archivist for Wells Fargo. She also leads the Wells Fargo Oral History Program.
TITLE: The Virtual Vineyards story: Finding innovative solutions for customers
TITLE: The idea
CAPTION: In the early 1990s, brothers-in-law Robert Olson and Peter Granoff had an idea for a start-up company:
Virtual Vineyards, an online wine store.
TIM KNOWLTON: They were a unique combination in that you had the business expert in Peter Granoff who understood wine. He was a master sommelier. And then his brother-in-law, Robert Olson, happened to be a tech genius.
CAPTION: At the time, shopping online was a new concept.
TIM KNOWLTON: There was no concept of ordering online. You called them on the phone. That was how the internet sales were going.
CAPTION: Robert and Peter had another idea: real-time credit card payments.
ROBERT OLSON: Well, we weren’t really going to launch the business without the ability to take transactions. Because I felt that that was really central to the business we were trying to build.
TITLE: Connecting with Wells Fargo
CAPTION: Their challenge: secure online credit card payments had never been done before. Investors were unsure.
ROBERT OLSON: “No bank is ever going to work with you, because you know, the internet’s not safe and it’s scary. And all those kind of things.”
CAPTION: They needed a way for customers to pay online and approached Wells Fargo’s then-CEO Bill Zuendt
PETER GRANOFF: He not only understood what we were trying to accomplish, but was prepared to line up the resources at the bank internally. And we were off and running.
DEBRA ROSSI: Well, that was my job at Wells Fargo. How do we help customers, small business customers? How do we figure out a solution that can help them grow their business?
TIM KNOWLTON: So, a lot of the work was behind the scenes, not visible. It was how do we get this new technology to interface with this old technology?
ROBERT OLSON: Magic happened as far as I was concerned.
TITLE: The magic moment
CAPTION: In December 1994, VirtualVineyards.com went live and processed their first transaction: a case of wine.
PETER GRANOFF: It was literally within minutes of taking the server live on the internet.
ROBERT OLSON: We got really jazzed about that, because finally this thing was really happening.
TIM KNOWLTON: It was pretty exciting when it worked.
DEBRA ROSSI: We’re making history. We’re changing how business is going to be done.
PETER GRANOFF: At some point it just caught on fire.
ROBERT OLSON: People suddenly switched from saying, “I would never trust my credit card on the internet” to “Of course I’d buy on the internet.” Timing is everything.
CAPTION: Other customers soon followed in Virtual Vineyards’ footsteps.
TIM KNOWLTON: I was probably getting 100 merchants a week who wanted to sell on the internet.
DEBRA ROSSI: We were in the right place at the right time.
PETER GRANOFF: It’s kind of hard to grasp from where we sit today how much has changed, and how fast.
ROBERT OLSON: I don’t think we would’ve started the business had we not been able to securely transact credit card transactions. I would’ve found something else to do.
CAPTION: How often do you make online purchases today?
DEBRA ROSSI: To me, Wells Fargo was an innovator since 1852. This is just sort of like, you know, the stagecoach online, moving the stagecoach at speed of light. And I think when you have the customer as the focus, you know, innovation is easier.

In 1994, two small business entrepreneurs had an idea about an innovative way to sell their product, but needed a financial partner to help make their dream a reality. Peter Granoff and Robert Olson’s vision for Virtual Vineyards was to offer a curated selection of fine wines not available in traditional retailers. Wine buyers could browse selections on their website, but taking credit card payments online was a problem. No one had yet invented a way to securely send payments over the internet. Virtual Vineyards turned to Wells Fargo Bank to create a secure payments system; an innovation that launched the world of e-commerce in December 1994.

Wells Fargo Bank’s Merchant Card Services designed an encrypted and secure payment processing system that allowed Virtual Vineyards’ customers to order and pay for merchandise over the internet. An immediate success, this technology had a huge impact on growing their business. Today, consumers buy billions of dollars worth of goods online every month. But it all started with a pair of vintners and a bank willing to help them create a revolution in retailing.

Color photograph of two men in sweaters sitting at a table. On the table are a collection of un-opened wine bottles and two laptops from the 1990s. The computers are open but not turned on.

Robert Olson (left) and Peter Granoff (right), 1995. Photo Credit: Wells Fargo Corporate Archives.

Featured speakers:
Peter Granoff – Master Sommelier and Virtual Vineyards co-founder
Robert Olson – Tech Entrepreneur and Virtual Vineyards co-founder
Debra Rossi – Former Wells Fargo Merchant Card Services Executive
Tim Knowlton – E-Business Systems Consultant, Wells Fargo Merchant Card Services


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