Fast Company

A high-flying Web start-up, DEN imploded among allegations of drug use, guns, and pedophilia


A BOY'S LIFE The pilot episode of DEN's Chad's World tells the story of a boy who is adopted by two wealthy gay benefactors

Even in an era when catching pedophiles makes for must-see TV, the picture in the UK Sun was remarkable. Marc Collins-Rector, nattily dressed in a tan blazer and blue shirt, sporting a pair of Wayfarers and carrying a silver-topped cane, stands outside a PC World in London, accompanied by a teenage boy lugging a newly purchased set of high-end computer speakers. The headline: "Tycoon Paedo on Prowl in UK."

Historians of the Internet bubble might remember Collins-Rector as a cofounder of the Digital Entertainment Network, an online video empire that was one of the most talked-about new media launches of its day, before its spectacular flameout. Accused of molesting numerous teenage boys who worked for him, the 48-year-old entrepreneur went on the lam to Europe. Apprehended 21 months later, he was extradited to the United States, where, after what seems a rather lackluster prosecution, he pled guilty to eight counts of luring teens across state lines for sex, and paid a small fine. Two years later, here he was, as the Sun put it, "swanning around Britain in a chauffeur-driven limo and surrounding himself with young boys."

PASTY MONSTER Collins-Rector strikes a pose for the Florida sex-offender registry
Such brazen behavior wouldn't surprise anyone who knew Collins-Rector back when DEN was riding high. In those heady days before the Internet bust, a Who's Who of gay Hollywood flocked to notorious all-night bashes at the "M&C; estate," so named for Marc and his twentysomething cohort Chad Shackley. The pair, who met on an online bulletin board (remember those?) when Shackley was just 15, collaborated on a number of tech start-ups, including an early Internet service provider, Concentric Network Services. Flush with cash from their successful ventures, Collins-Rector (who had changed his name from the more pedestrian Rector) and his young colleague landed in Encino, California, where they took a special liking to a $4.2 million Spanish colonial McMansion that had previously belonged to Death Row Records rap impresario Suge Knight. Streams and waterfalls traced the carefully manicured 1.5-acre grounds, which housed a tennis court, an enormous gazebo, a swimming pool, aquariums, a home theater, and a hot tub built for 12. Among their new acquaintances in Los Angeles were such industry heavies as David Geffen, uber-manager Sandy Gallin, then–NBC Entertainment president Garth Ancier, and Usual Suspects director Bryan Singer. It's also where they hatched an audacious plan for a Web-based television venture that was to consign the networks to the dustbin of history. They called it DEN, and staked its business model on "narrowcasting," or marketing to thin demographic segments. An early attempt to capture the online video zeitgeist that eventually blossomed with YouTube, was instead rooted in original programming. The plan attracted major investments from key players in Hollywood, the tech industry, and Wall Street, ranging from Geffen and Singer to Intel, NBC, and Microsoft. Representative Michael Huffington wrote a check for $5 million after a lavish dinner party at M&C;, boasting to a friend that he expected to reap at least a tenfold gain from his investment.

Another regular at the mansion was DEN executive VP Brock Pierce. He was aggressive and self-assured, with blond hair and an insouciant pout. He was also still a teenager—17 years old and coming off a successful career as a child actor, with The Mighty Ducks and First Kid among his credits. According to a DEN board member, Pierce was hired as "the guy who could tell us what Gen Y-ers were likely to think." This talent came in handy not only in targeting the youth demographic, but also in bringing a supply of beautiful young men to the estate, lured with vague promises of fame as the Internet's first TV stars.

Eventually, a number of these acolytes would file lawsuits alleging they were raped and/or sexually abused at M&C; by the three cofounders. Their charges are remarkably consistent—all claim they were bullied and drugged to coerce sexual compliance, and in some cases, threatened with loaded guns. When the plaintiffs filed civil suits against Collins-Rector, Shackley, and Pierce, the three suddenly disappeared with what remained of their fortune—turning up two years later living in a villa in Spain. They were arrested by local authorities, who uncovered "an enormous collection of child porn," according to Spanish police reports. In their absence, the plaintiffs were awarded default judgments in the amount of $4.5 million, but have collected only a small fraction of that. And while Collins-Rector is living it up in London—taking his young friends to lunch at Gordon Ramsay's restaurant in Claridge's hotel, according to the Sun—Pierce has recently been lauded yet again as a New Economy genius for his role in a fast-growing Internet venture that's drawn praise from the likes of Fortune and CNN.

02-chads-world.jpgDIRTY MOVIES Before cofounding DEN, Brock Pierce starred in a string of Disney hits, including the 1996 schlockfest First Kid
For a company that brought in nearly $100 million from world-class investors and made the lofty promise that "global entertainment will be delivered over the Internet; [DEN] will create the last network," its product was stunningly bad—even by dot-bomb standards. The business plan was lacking in many respects. A major selling point that Collins-Rector touted to investors was a feature that would allow viewers to click on, say, a shirt or lamp in one of the shows and immediately buy it online. Unfortunately, the click-to-purchase technology never materialized, and the venture was vexed by a more troubling technological issue: Broadband was still a rarity in the late '90s, so most of the intended audience had to access the programming via 56K modems. "We all bought into [Marc's] vision of the technology," says DEN's chief marketing officer, Edward Winter, now chairman of the youth-marketing firm Tracy Locke, "but soon we were being told by Internet experts that 'you can't stream video right now.' It became pretty clear that it wasn't going to work."

Still, DEN pressed on, shrinking the format and utilizing shots with as little movement as possible. The company built a space-age headquarters in Santa Monica, furnished with $1,800 chairs and a state-of-the-art newsroom that was put to little use. Instead, DEN's founders devoted most of their attention to the network's flagship show, Chad's World, which targeted gay and questioning teen boys. Filmed at the M&C; estate, Chad's World was the founders' most personal creative effort. Co-written by Collins-Rector, produced by Pierce, and loosely based on Shackley's life, it featured one of the boys who would later accuse the DEN founders of molestation.

Chad's World starred a 14-year-old actor named Brian Stark as Chad, and Seann William Scott—who shortly thereafter won a starring role in American Pie—as Jim, a California entrepreneur based on Collins-Rector. While the film's production quality was more in line with down-market porn than network programming, the producers doled out a mind-boggling $12 million in salaries for the series. (Contacted by Radar, Stark declined to comment on the show. Scott's agent thanked Radar for "thinking of Seann" but similarly declined to comment.)

The pilot episode revolves around two young men coming to terms with their sexuality. Chad convinces his close friend Paul to come out of the closet to his cartoonishly repressive parents. Upon learning that his son is gay, Paul's father calls him an "abomination against God," provoking the spurned boy to blow his own brains out. "It's for the best," Dad muses. Brushing off the brains of his friend, a despondent Chad runs outside and makes a "Why, God?" gesture to the skies as grunge rock burns in the background.

Before long, he meets his high-flying benefactor, Jim, who lives with Chad's older brother at a suspiciously familiar mansion. The duo, who are shuttled around in dark sedans and surrounded by phalanxes of black bodyguards, invite young Chad to live with them, generously dispatching a few of their bodyguards to stomp Paul's homophobe dad on his lawn.

Cheerfully, Chad moves to Encino to play-wrestle with his new roomies and enjoy a lavish new lifestyle. "Oh, yeah!" he exults after being presented with a BMW and black driver of his own. "I think I'll be able to hang here!"

When Chad's World debuted on in June 1998, many critics couldn't even download it—which was probably a blessing for all involved. "Chad's World was the first signal that maybe things weren't right [with the company]," says Winter. "It was definitely, um, ahead of its time."

It felt like a "gay pedophile version of Silver Spoons," adds another industry observer who saw the pilot and five unaired episodes. "I first thought it was some sick fantasy of theirs," he adds. "When I found out about the molestation charges, I realized that it was more a case of art imitating life."
A Web-based TV hub, DEN promised to make the networks history, and drew major investments from Hollywood A-listers, the tech industry, and Wall Street

Other DEN shows also targeted thin slices of the adolescent male demo, including young Latinos (Tales From the Eastside, in which, according to one former employee, every line of dialogue began, "Yo! Ese!"), Asians (The Chang Gang), Christians (Redemption High), frat boys (Frat Ratz), and punks (Fear of a Punk Nation). Though the company promised to reach 1.5 million viewers, never surpassed 5,000 hits per day.

A $75 million IPO was planned for October 1999, but days before it was filed, a young man from New Jersey, identified in court filings as Jake W., served papers for a lawsuit claiming he'd been molested by Collins-Rector for three years, beginning in 1993 when he was just 13. Collins-Rector quickly paid a settlement, and his attorney fired back in the press, calling the suit "classic IPO blackmail" and describing the settlement as "a token payment to save the company."

In the same way he'd met Chad, Collins-Rector had connected with Jake via an Internet bulletin board. The executive offered the boy a job at his pre-DEN venture, Concentric, and Jake began working from home for $10 an hour. Soon, though, Collins-Rector decided he needed Jake at the Michigan office and flew him out from New Jersey, lodging him in a spare bedroom. During the visit, according to the lawsuit, Marc repeatedly asked, "Do you trust me?" with his hand roaming across the boy's body. Then he performed fellatio on him.

With the FBI investigating Jake's allegations and investors panicking, all three founders immediately quit their executive posts (retaining substantial stock positions), leaving DEN's new chairman, Howard Ritts, in charge of the company.

Within months, all three of the company's founders had been hit with a flurry of civil lawsuits. Boys who had been paid for vague jobs with the company under the condition that they agree to attend parties at the M&C; estate began telling stories of sexual abuse at the hands of Collins-Rector, Shackley, and Pierce, as well as other highly placed Hollywood figures.


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