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RealTime IT News

A Friday Feast of Internet Offerings

If the four Internet IPOs that have priced this week but not yet gone public begin trading Friday--and there's no reason to expect that they won't--it will be the single busiest day of 1999 for Net debuts.

The quartet includes "Gen Y" Web community site/fashion etailer Alloy Online; online Visa card dispenser NextCard; Internet services vendor Scient; and Web stock broker onlinetradinginc.com.

We've already covered Alloy Online. The only thing new to report is the New York-based company has priced at $15, above the $10-$12 offer range for its 3.7 million shares.

Of the remaining three, expect NextCard to draw the most interest among investors, despite its relatively short operating history and big first-year net loss. Some analysts believe that NextCard, based in San Francisco, has established a unique business model that puts it way out in front of prospective competitors.

NextCard offers consumers instant online credit card application processing and approval, the first company to do so. Besides its NextCard Visa, issued by Heritage Bank of Commerce in San Jose, Calif. (at rates ranging from 2.9% to 9.9%), the company provides cardholders online customer service and account management, as well as Internet shopping. Yes, that's right, you can get your money and spend it all on one convenient site.

The company's business plan has attracted an A-list group of venture backers, including Brentwood Venture Capital, Kleiner Perkins Caufield & Byers and Sequoia Capital. Lead underwriter for the IPO is Donaldson Lufkin Jenrette.

NextCard was formed in 1996, but didn't really begin generating revenue until last year, when the company had sales of $1.1 million against net losses of $15.6 million. Early investors are looking past those unenviable numbers and focusing on NextCard's open playing field and plans to form NextBank, which would allow the company to ditch its online middleman status and issue its own credit cards accounts while accepting customer deposits.

Having priced its 6 million shares Friday morning at $20--above the $17-$19 proposed range--NextCard hopes to raise $120 million with its IPO. The company's Nasdaq ticker symbol will be NXCD.

Scient, also based in San Francisco, provides customers such as eBay and Chase Manhattan with a range of Internet consulting and integration services. The company had revenues in 1998 of $20.7 million and net losses of $11.7 million.

On Thursday Scient priced 3 million shares at $20 (also above a proposed $17-$19 offer range). It will trade on Nasdaq under the symbol SCNT. Lead underwriter for the offering is Morgan Stanley Dean Witter.

Small-capper onlinetradinginc.com priced 2 million shares at $7 each on Wednesday, but didn't go public Thursday. The company pitches its Internet stock broker services to wealthy individual investors and small to mid-sized financial institutions.

Based in Boca Raton, Fla., onlinetradinginc.com reported $6 million in revenue and a $117,298 net profit for the fiscal year ended Jan. 31, versus $3.7 million in revenue and a $19,428 net loss in 1998.

Lead underwriter is Werbel-Roth Securities. The company will trade under the Nasdaq symbol LINE.

WebMD Bails on IPO For Second Time

Atlanta-based online health care information provider WebMD has filed a formal request with the SEC to withdraw its initial public offering of stock.

It is the second time that WebMD has pulled out of IPO plans. The company cancelled a stock offering last summer after the Internet IPO market turned cold. The reason for the latest pullback appears to be that the company has attracted investment interest from Microsoft and possibly some other large players.

WebMD had planned an early May IPO, with plans to raise $55 million.


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