Why the hell would or should they do that! With do respect, Insweb's model is nothing more than a transitory step. Healthaxis is a revolution and they are having success in convincing the industry that this is the future. An industry, I might add, that has been slower than most at embracing new technologies.
The company is building both a brand and a platform to be the dominant provider of insurance over the internet. They have not yet been recognized for it, but they will. This is the ground floor. Similiar doubts were put before E-trade and Ameritrade before their biz took off.
Healthaxis has one of the more powerful business models on the net (they create an annuity, reccuring biz with the opportunity to cross sell other products) versus Insweb which is the on-line version of a direct mail piece. Yes, it does help you find what multiple providers that have what you are looking for, but it stops there.
The equivilent of insweb would be a shopping service (many of which were started on the web a few years back) that would allow you to search for a product or product category, find all the retailers in your area that carried (like Insweb finds the carriers that offer product in your state)the product and then gave you the specs and price. Then they would give you the address of the store and you could go pick it up. Sounded good.
But some smarties like the guys at Amazon, e-toys, and the multiple on-line retailers realized that if you already have them on-line, complete the sale and make their life easier. Even better, you could offer a discount because you didn't have the same expense structure, and so on, etc.
Insweb is a transitionary company. Healthaxis is a revolutionary company. Model for model, Healthaxis wins hands down. The pieces are in place, the capital is in the bank and the roll up is being finalized. Then the fireworks begin. All the shorts who babble on Yahoo or elsewhere are fools. Worse, they are not even shorts, check the short interest, its tiny.
All the PAMC bashers are people they threaten (brokers in the industry, middlemen related to the industry that will lose business, employees of INsweb?). It is all just noise. The most interested institutional investors that have dug deeply into the company are the guys who have now invested nearly $50 million this year privately. It is the analyst community that will create the real buzz and coming out party when they complete the roll up and PAMC is a memory.
The first run up was a little premature, although some people made a lot of cash ($7 to $40). The next run will be real and supported by real growth and significant analyst coverage. PAMC has next to nobody even following it. Not many mutual funds buy a company like that. This is a jewel hidden under the symbol of an old line, underperforming insurance underwriter. That biz is gone and a new one has been born. Buckle up folks, this teenager is going to get old fast. |
