Family Christian Stores Launches $30 Million Internet Venture for Nation's 85 Million Christians.

iBelieve.com Teams with Madison Dearborn Partners

To Integrate Content, Community and Commerce

CHICAGO, Sept. 27 /PRNewswire/ -- Family Christian Stores, the nation's leading Christian retail chain, today announced plans to launch a comprehensive web destination site aimed at helping Christians enrich their spiritual lives, communicate with each other and purchase products and services online through an innovative contextual commerce model.

Family Christian Stores said it is teaming with the $4 billion private equity firm Madison Dearborn Partners to build the premier destination site for online Christians -- iBelieve.com. Chicago-based Madison Dearborn is leading a first-year $30 million investment to launch the standalone venture.

"This new venture is more than just a retailer-goes-online strategy," said Family Christian Stores President and CEO Leslie Dietzman, also serving as iBelieve.com's CEO. "iBelieve.com is a standalone company with its own operations and management team committed to integrating e-commerce capabilities within the framework of proprietary content and community programming to satisfy all of a Christian's life intentions."

"The trusted reputation, industry knowledge and dominant commercial position of Family Christian Stores will provide a critical competitive edge to iBelieve.com," said Ben Chereskin, principal of Madison Dearborn Partners. "We are pleased to ally our financial resources with iBelieve.com's innovative business model and strong team to help facilitate its accelerated growth strategy."

iBelieve.com will be a one-stop destination site for Christians and other morality-concerned individuals, offering information resources, interactive channels, faith-based programming, activities and events, outreach and community offerings, and contextual e-commerce. The site will leverage the bricks-and-mortar presence of Family Christian Stores, including its nearly six-million-member affinity program, to build awareness and traffic for the site.

"iBelieve.com is the best positioned site to serve the rapidly growing online Christian community," said Dietzman. "The consumer intimacy and supplier relationships of Family Christian Stores, our credibility among potential alliance partners such as ministries and missions organizations, and our ability to attract a partner of the caliber of Madison Dearborn will enable us to create the ultimate and all-encompassing online experience for Christians."

Family Christian Stores is the industry leader in the $3 billion Christian retail market. The Grand Rapids, Mich.-based retailer operates 335 stores and has posted annualized revenue growth in excess of 30 over the last five years. This online initiative is intended to complement Family Christian Stores' rapid retail growth and expansion plans, projected to include a total of more than 130 new stores in 1999 and 2000.

Dietzman said the Christian retail market remains underserved at the store level and even more so on the Internet, inspiring the aggressive growth plan for this online venture.

According to an August 1999 national survey commissioned by iBelieve.com and conducted by Barna Research Group, 44 of self-proclaimed evangelical Christians, or more than 35 million people, are online. An additional 2.5 million Christians are expected to go online within the next six months. The research also found, however, that only 15 of the Christian respondents feel strongly about the Internet as a source of information about matters of faith.

"A void exists for the millions of Christians on the Internet, and we intend to fill it with a robust, all-encompassing online experience," said iBelieve.com President Jef Fite. "iBelieve.com will captivate online Christians by being original and relevant and staking the claim as the trusted, single source for Christians on the web."

Site Profile

Leading up to the scheduled launch of the site in January 2000, iBelieve.com will debut a growing assortment of information and offerings. A pre-launch site is currently live on the Internet and features brief profiles of the site, coming attractions, and an interactive, online poll on the "Most Influential Christians of the 20th Century."

At launch, iBelieve.com will offer personalized content and community programming generated by its ministry and mission organization alliance partners and its internal publishing and content team. This site will help Christians search for a closer walk with God, address the issues and opportunities that arise in their everyday lives, offer ways to reach out to their local community or the world, and develop a virtual community for Christians where they can interact and develop relationships with one another.

The e-commerce component of the site will provide visitors thousands of SKUs spanning all categories of Christian products from books and Bibles to music, gifts and apparel, as well as service offerings such as travel, entertainment, money management and health. The products will be offered in a typical e-commerce store format, as well as integrated throughout the site in the content and community offerings.

The site will employ leading-edge technology to ensure speed, ease of navigation and reliability for online users. Product fulfillment and customer service systems will closely mirror the high performance operating systems currently in place at Family Christian Stores, which ensure diverse selection as well as rapid replenishment.

Leadership Depth

The management team of iBelieve.com is led by Leslie Dietzman, who will hold the CEO title at both Family Christian Stores and the Internet venture, and President Jef Fite. Dietzman has led Family Christian Stores since 1994, joining the company following senior level positions at Wal-Mart, Ames Department Stores and Mervyns. Fite is a former Family Christian Stores special projects and technology executive and served for a number of years as an information and operating systems specialist at Andersen Consulting.

Other members of the leadership team include chief content officer Allen Arnold and chief customer officer John Nardini. Arnold joins iBelieve.com from senior vice president of marketing at Word Publishing, a division of Thomas Nelson, the world's largest Christian books and Bibles publisher. The former Ogilvy & Mather branding and advertising executive led Word's marketing, special events and advertising efforts for eight years. Nardini joins iBelieve.com from vice president of marketing for Chordant Distribution Group, the nation's largest Christian music distributor. Nardini was the CBA (Christian Booksellers Association) "Impact X2 Innovator of the Year" in 1999 as the individual most responsible for growing the industry, and is a former H.J. Heinz and Procter and Gamble marketing executive.

Fite said: "We are building an organization with proven leadership and an aggressive vision to ensure iBelieve.com sets the standard, not just as the leading Christian online site, but as a model among all affinity-based Internet strategies."

Family Christian Stores is the nation's largest Christian retailer with 335 stores in 38 states. Family Christian Stores' mission is to offer an extensive selection of high-quality, Christian-related products of exceptional value in a family environment. Family Christian Stores locations offer thousands of products including Christian books and Bibles, music, gifts and cards, apparel, children's merchandise and church supplies.

Madison Dearborn Partners is a private equity firm based in Chicago, Illinois, which manages a portfolio with more than $4 billion of capital under management. Madison Dearborn's objective is to partner with companies that have outstanding management teams and the potential for significant long-term growth. This includes investments in companies in the consumer, financial, industrial, communications, natural resources and health care services industries. MDP's Consumer team has significant experience investing in and working with companies in the retail and direct marketing sectors.