Phase2Media Files For $57 Million IPO
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In a move at once bold and curious, Silicon Alley Internet advertising and marketing shop Phase2Media Inc., has registered with the Securities and Exchange Commission to offer up to $57.5 million worth of common stock.
The company did not disclose an offering price range but did say the stock would be quoted on the Nasdaq market under the symbol PTWO.
Robertson Stephens will serve as lead underwriter, with Chase H&Q, Thomas Weisel Partners and DLJdirect acting as co-managing underwriters.
The announcement comes about two months after the company closed a third round of venture funding of $18 million, led by GE Equity. At the time of the early March announcement, Richy Glassberg, chairman and chief executive officer, said those funds would enable Phase2Media to double its staff of 120 employees and boost overseas expansion efforts.
The move to enter the markets, as Internet plays have become the scourge of investors, is bold one for the company, which reported $12.9 million cash in hand as of the end of March. Phase2Media reported pro forma net losses for the first quarter of $3.3 million (or 54 cents per share) on revenues of $5.2 million, compared to a loss of $5.8 million (58 cents per share) on revenues of $4.4 million during the fourth quarter.
But the company's use of direct sales reps -- in an on-line advertising category increasingly driven by automation -- may prove a competitive advantage as Web sites continue looking for ways to help their advertisers wring more from their buys.
Compared to ad representatives for Web properties that use a network to distribute clients' ads, Phase2Media takes a more hands-on approach with individual site representation. For example, the company deploys a dedicated sales staff for Hachette Filipacchi Web properties and Prodigy. Other clients include the Elle Interactive Network and Maxim Magazine Online. And in a partnership with BMCMedia of Australia, the company owns the North American and European rights to sell advertising for the Olympic Committee's official Web site.