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SmartMoney Interactive
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After spending the early days of the Internet's development as the poor stepsister to the browser, the search engine and the portal (in its many incarnations), email is finally having its day. On Tuesday, CommTouch (CTCH), an Israeli-Californian hybrid, became the latest to join the email investing party. Shares of the messaging-service provider soared more than 50% above the IPO price of 16.
That makes two shining offerings in a month's time; New York-based Mail.com (MAIL), whose name alone is probably worth a couple of hundred million in market capitalization, is up more than 200% since its June debut. Critical Path (CPTH), a San Francisco-based provider, was first to market in March. After rocketing to 150 amid the spring Internet fever, its shares have settled at around 50, still more than double the offering price.
"It's amazing to me that it's taken so long," says Gerald Gorman, CEO of Mail.com, in response to a recent, and sudden, surge of interest in email outsourcing outfits.
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But now it seems that the next big thing in Internet investing has been sitting on our desktops since the dawn of cyberspace. Not only has email become a necessary tool for Internet service providers, portals, commerce sites and corporations, it is becoming so complicated that it makes sense to let somebody else take care of it. That's good news for this spate of new offerings.
"The market opportunity is huge, and frankly, I'm surprised that there are only three or four large competitors in this segment of the industry," says CommTouch CEO Gideon Mantel. "You would expect a larger number of players."
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