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Follow up:
FreeMarkets, Inc. (FMKT-NASDAQ) had an eye-popping debut on Dec. 10. FreeMarkets priced at US$48.00, above the expected pricing range, and opened at a whopping 416% premium. The stock traded above US$290. Hold off on any aftermarket buying, because it's the hype that's driving the share price.
Interwoven, Inc. (IWOV-NASDAQ) continues its steady price climb since its IPO. ChannelPoint, SmartAge.com and myplay, inc., the latest online businesses to realize the critical nature of content management, have chosen Interwoven TeamSite software to build and manage all content critical to their eCommerce initiatives. Our IPO position is up 823%.
Red Hat, Inc. (RHAT-NASDAQ) continues to ride the Linux bandwagon. With the recent IPO success, perhaps the biggest opening for an IPO, of VA Linux (LNUX-NASDAQ), Red Hat traded above US$300. We're already up 1,671% in four months!
Akamai Technologies, Inc. (AKAM-NASDAQ) has been unstoppable since its IPO. With the holiday season shopping at a high, several leading e-tail Web properties have selected Akamai's FreeFlowSM Internet content delivery service for enhanced speed, performance and reliability of their Web sites. Companies include Ashford.com, Bluefly.com, KBkids.com, Lands' End, marthastewart.com, ShopNow.com Inc., Ticketmaster Online-CitySearch and Wrenchead.com, who demand constant site uptime to remain profitable during the busy holiday season. Our IPO position is up 784%.
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RealNames fulfills the need for speed and simplicity on the Net!
by Siu-Yee Ng
Back in 1984, the Domain Name System addressing system was established with the primary purpose of allowing user-friendly e-mail addresses, such as JOHNDOE@REALNAMES.COM, to run on top of IP addresses. As a result, users no longer had to remember a numeric address but could identify an e-mail address by a word or company name. DNS proved to be very effective as a platform for e-mail, which had used the Simple Mail Transfer Protocol but was difficult to use for locating other Internet resources.
While the domain name is a simple way of creating an e-mail address, the domain name and its extension, the uniform resource locator, is a relatively complex way of creating an address for Web pages. As companies add Web pages to the Internet, they must layer more and more prefixes and suffixes to their domain names to create URLs identifying those Web pages. As a result, URLs have become less intuitive and more difficult to remember.
Going senile?
Having trouble with www.???Forget the exact site name? RealNames Corp. (NAME-NASDAQ) has developed a new addressing system based on Internet Keywords that simplifies navigation on the Internet. Internet Keywords are generally intuitive, familiar words and phrases, such as company, product, brand and personal names. They can be used instead of search engines, directories and even URLs, to navigate directly from any point on the Internet that recognizes Internet Keywords.
This simplifies Internet navigation for users and allows companies to promote their brands as direct connections to their Web pages. Internet Keywords are available to more than 60% of U.S. Internet users, according to the August 1999 Media Metrix data. This is a result of being integrated into search engines, directories and portals such as AltaVista, DogPile, GO Network, LookSmart and MSN.
Internet Keyword functionality is also integrated into Microsoft's Internet Explorer 5.0, which Stat Market estimates to have a greater than 30% share of the installed base of web browsers.
Web surfing for dummies
How many unique URL sites can the Internet have? With more sites popping up, URLs will only get longer and more complex to remember, making them an inefficient means of locating specific Internet resources and reaching online customers, businesses and communities. For example, Internet users who wish to navigate directly to the Honda Accord Web page through its URL must input the lengthy Web address WWW.HONDA2000.COM/MODELS/ACCORD_SEDAN/INDEX.HTML.
Search engines have been one way Web surfers have looked for sites. Search engines are great for research but when entering a specific topic, they generate many results, and usually only one, if any, is the Web page which the user wants to navigate to.
URLs have also generally been ineffective in promoting online brand identity. The limitations of navigating with URLs have created a challenge for companies seeking to bring their offline brands and identities onto the Internet and have made it difficult for them to promote their online existence to viewers, listeners and readers of their offline marketing activities. Just as domain names replaced long, difficult-to-remember numerical addresses for e-mail, there is a need for something to replace long, difficult-to-remember URLs for Web pages.
The RealNames Service, using Internet Keywords, allows users to efficiently navigate to the online location of companies, brands and products and people and enables companies to leverage their well-developed offline brands and identities. Internet Keywords operate on the RealNames platform, a new layer of Internet infrastructure that is designed to provide an intuitive navigation interface that hides complex and lengthy URLs.
Bread makers
Sales are done through RealNames' Web site as well as reseller partners such as Network Solutions, which sells annual, fixed-priced Internet Keyword subscriptions and provides qualified customer referrals.
The company recognizes revenue from Internet Keywords and banner advertising. Revenues are generated from license fees for Keyword prefixes, amounts paid per visit or per completed transaction when the user accesses the customer's Web page using Internet Keywords, and fixed-priced annual subscriptions to Internet Keywords.
RealNames has never been profitable. But that's to be expected with any start-up.
Revenues were approximately US$1.1 million for the six months ended June 30, 1999 compared to no revenues for the six months ended June 30, 1998. Revenues were US$537,000 for the year ended Dec. 31, 1998.
The net proceeds from the offering will be used to satisfy the company's revenue share, marketing and facilities commitments, recruit and hire personnel in all operating areas, expand internationally, recruit additional distribution partners, establish additional data centers and aggressively market the RealNames Service.
Big bucks
RealNames formed a major alliance with Network Solutions, the exclusive provider of all .com, .net and .org domain names. Network solutions has a 10% stake in the company with the option to purchase 20% of RealNames' common stock. Other shareholders include VC firms Draper Fisher Jurvetson, idealab! and Capital Partners. RealNames has also formed partnerships with search engines AltaVista and LookSmart and customers include eBay, Amazon.com, Federal Express, HealCentral.com, and FedEx.
RealNames have been busy since the filing with the SEC in October. The company lined up 27 companies who have agreed to resell Internet Keyword subscriptions along with their Web address services.
Another plus to its global expansion, RealNames Internet Keyword service is now available in both American and French versions of the Viola Network, France Telecom's international network of portal sites that provides localized search solutions and content throughout Europe and the U.S. And in December, the company added the AltaVista German site to its Internet Keywords and navigation service.
Ivy league team
The chairman of the board, president and CEO co-founded RealNames in November 1996. He co-founded and served as chief technical officer at The Easynet Group, an Internet Service Provider. He also founded Cybercafe, an Internet company, and has served on its board of directors since its inception.
The executive vice president, chief financial and administrative officer was a partner with the law firm of Wilson Sonsini Goodrich & Rosati.
The executive vice president of strategic business development joined RealNames in May 1998 as executive vice president of sales and marketing. He co-founded and served as chief operating officer and executive vice president of development at Softbank Interactive Marketing, an Internet marketing services company. He co-founded and served as president of Network 1.0, an Internet and marketing services company. He also founded and served as president and publisher of Consumer Direct Access, Inc., a directory publishing company, from January 1991 to May 1995.
It's always nice to see a strong management team, but it's a plus to see directors who can lend a hand when needed. Another co-founder of RealNames has served as a director since November 1996. Prior to joining RealNames, he served as chief technology officer at NeXT Software. The company also has a director who is the chief financial officer and acting chief operating officer of Network Solutions, an Internet company, which he joined in March 1996.
I usually don't like to see investment bankers involved in an offering, but this may be an exception. RealNames also has a managing director of Morgan Stanley Dean Witter for a director. He serves as a director of Adaptec, a computer peripherals company, and Evolving Systems, a telecommunications software company.
Morgan Stanley Dean Witter, Hambrecht & Quist, Robertson, Stephens & Company, PaineWebber Incorporated and Wit Capital Corporation are the underwriters. No price or date has been set, so log on to IPO Trader for any updates.
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