Thought you might want to see some comments on GNET by:
- internet.com's -
I N T E R N E T S T O C K R E P O R T
By Tom Taulli
Senior Analyst (mailto:ttaulli@internet.com)
isdex.com
"Where Wall Street Meets The Web"
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Go2Net: Going Nowhere
What's your opinion of Go2net? The stock has been perking-up lately.
Reply: It was the Paul Allen investment that saved Go2Net (GNET) from virtual extinction. Basically, Go2Net was a microcap IPO, issuing 1.6 million shares at $8 a piece. The underwriter was third-rate, Maxwell Capital. In fact, the President and CEO of Maxwell Capital was the brother of Russell Horowitz, the CEO of Go2Net and the firm had never
completed an IPO (it was less than one year old). Because of the conflict, Go2Net had to find a so-called "qualified independent underwriter" (under Rule 2720 of the Conduct Rules of the NASD), which was National Securities Corp., another third-rate underwriter.
Being a small underwriter, Maxwell Capital lacked the resources to give visibility for Go2Net. Interestingly enough, Horowitz was a founder of another company, called
Active Apparel Group (AAGP) , a similar microcap IPO. The stock is selling for $2-25/32.
True, now Go2Net's bank account is much healthier. But this is no guarantee of success. In fact, after the Paul Allen deal, the stock has been, well, unexciting. Perhaps the big reason is that the company has an unfocused management team. This has been evidenced by the chaotic acquisition strategy.
Go2Net is supposed to represent the portal for Paul Allen's vision of a "wired world"; unfortunately, that is being pursued by a management with little vision.
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