Latest Internet IPOs Span Range of Business Models
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There may be no marquee Internet companies going public this week, but the range and breadth of economic models being explored by 'Net entrepreneurs is on full display among this week's group of expected IPOs.
The nine Internet companies tentatively slated to debut on Wall Street include a provider of e-commerce enabling services, a Tier 1 ISP, a search engine for hire, and a content/community Web site for educated yuppies and Gen X'ers.
Among the companies that may test the IPO waters this week are:
AppNet Systems, which offers corporate customers e-commerce consulting and outsourcing services. The company has built an impressive list of clients, including Ford Motor, the U.S. government and AOL.
Internet services and access provider CRL Network Services, which plans to raise $79 million in an offering of 5.85 million shares in the $12 to $15 price range.
Besides connectivity and Web hosting, CRL offers remote access management, network integration and other services. The San Francisco-based company has built its own Internet backbone with 30 points of presence in the U.S.
Founded way back in 1983, CRL had $11.7 million in revenue last year against a net loss of $0.2 million. That revenue figure was only 12% higher than the $10.4 million posted in 1997, a year that also saw a nearly $1 million profit. CIBC World Markets is lead underwriter; Nasdaq ticker symbol will be CRLX.
Search engine upstart GoTo.com, which generates revenues by allowing advertisers to bid for the best placements in search results. In other words, that first result listed by GoTo.com will direct users to a site run by the advertiser that paid the most money.
The company, which was profiled in the April 19 Midday Report, hopes to raise $60 million in an offering of 5 million shares priced between $11 and $13. While GoTo.com had only $822,000 in revenues in 1998, its Q1 '99 sales were $1.45 million. Lead underwriter is Donaldson, Lufkin & Jenrette; Nasdaq ticker symbol will be GOTO.
Online publication Salon Internet, perhaps the most recognizable of this week's crop of IPO contenders.
Salon's main claim to fame to date has been its involvement in the Clinton-Lewinsky scandal. The site broke the story about Illinois congressman Henry Hyde's five-year "youthful indiscretion" that began when he was in his 40s, and has been accused by conservatives of being a tool of the White House attack dogs.
From fiscal '98 to '99, revenue grew from $1.2 million to $2.9 million, while net loss in that same time grew from $3.8 million to $6.2 million.
Also based in San Francisco, Salon relies primarily on advertising revenue. The company reports that 1.2 million unique users visited site in March.
Salon, which will trade on Nasdaq under the symbol SALN, plans to sell 2.5 million shares at $10.50 to $13.50 each for an offering of $30 million. Lead underwriter is W.R. Hambrecht & Co.
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