Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : Tulipomania Blowoff Contest: Why and When will it end? -- Ignore unavailable to you. Want to Upgrade?

To: KeepItSimple who wrote (2049)	10/2/1999 3:51:00 PM
From: lifeisgood	Read Replies (2) \| Respond to of 3543

big brokerages illegally distribute non-public information all the time. Eventually, people are going to go to jail for this. I doubt it, there aren't enough jail cells.

To: KeepItSimple who wrote (2049)	10/2/1999 5:36:00 PM
From: Mad2	Respond to of 3543

Standard operating proceedure. Only problem those who get the information arn't supposed to go bragging about it. It's pure human nature to help those who help you. In a similar vein see this interview with Softbank.....they pretty much admit that they have their own little kiretsu (INTC, MSFT and CSCO) and they don't invest (read help) in companies whose interests aren't alligned with their's. We have been raised with a certian set of ideals (that's good) of fairness, honesty and so on. These ideals are perfectly fine when it comes to dealing with people on neutral ground, however business is a jungle where you don't sht where you eat, don't eat your young, and relish eating the young of others (species). mad2 SHOW: DIGITAL JAM 19:30:00 pm ET September 10, 1999; Friday 7:40 pm Eastern Time Transcript # 99091007FN-l11 TYPE: INTERVIEW SECTION: Business LENGTH: 1491 words HEADLINE: Tech Sect/Reg Guest, CNNfn GUESTS: Gary Risechel BYLINE: Bruce Francis BODY: THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. BRUCE FRANCIS, CNNfn ANCHOR, DIGITAL JAM: Internet venture capital group SoftBank has its stamps on many of the most successful business on the Web. From ETRADE to Yahoo! , SoftBank has bet billions on big and small ventures. Will look at what's next on the world of the Web. SoftBank Technology Ventures executive managing director Gary Rieschel joins us again from Palo Alto, California. Welcome back to the JAM Gary. Good to see you. GARY RIESCHEL, EXEC. MANAGING DIRECTOR, SOFTBANK: Good to see you thank you very much. FRANCIS: First of all as we noted yesterday just a few minutes ago rather, it's been a remarkable run up for the Nasdaq and a nice rebound for Internet stocks in particular. You folks must be pretty happy with how your portfolio is performing. RIESCHEL: Yes. I joke sometimes that I can't tell you plus or minus 500 points where the Nasdaq is on a daily basis but the last week I think has caught everyone's attention. FRANCIS: What's your feeling about the capital markets right now? We hear a lot of crumbling about the crowded IPO calender. Is that something that concerned you? You is someone who is often on the supply side of that equation. RIESCHEL: It concerns us in the sense that the difference in the quality of the deals back and forth that are currently in the cue. I think that institutions are getting wary, quite correctly, about all the different deals that are being pitched at them. And I think that the bankers are struggling to articulate stories in the increasingly crowded market. So we worry that some of the real quality deals can't get out so that will concern us. But over all the number of IPOs that has occurred this year have been extraordinary. FRANCIS: Would you not encourage one of your investment, invested companies here to go public in this environment because of the crowded calender? RIESCHEL: I think it depends who your banker is frankly. I think the bankers with the strong analyst teams are still getting out the deals that they want and they're prioritizing the deals that they know can get out and institutions are going to accept. But I think right now if you have concept deal, the likelihood of it having a successful after market performance is very low. FRANCIS: Earlier this week I attended a news conference with your boss and the folk at Global Crossing and Microsoft talking about Asia Global Crossing. Sounds like bandwidth is a major part of the SoftBank strategy. Are you looking forward to seeing that help power a lot of the e-commerce and content companies you're funding? RIESCHEL: There been three dimensions to our strategy going back three years. The first was to invest very broadly in the service sector in the U.S. because the network in the U.S. was fairly well mature and you could start to invest in service companies. Overseas there's an opportunity to participate early in the infrastructure. So it's -- there's an opportunity to actually participate in Speednet (ph) in Japan or the Global Crossing Asia Pacific ventures, whereas those opportunities would not have been present in the U.S. several years ago. So its a natural extension in the last several years, participating in the entirety of building out the Internet on a global basis. FRANCIS: A lot of the buzz these days is about a business to business Internet business models versus business to consumer. What's your, what's your feeling? RIESCHEL: Our take is that the business, the business to consumer side has a long way to run. Business to business three years ago people made a lot of bets on that happening faster than business to consumer. And the reason it didn't was that the business rules between organizations are very difficult to define. So between a Cisco and some of its suppliers or some of its customers. You still have a lot of rules you have to get in place and very few companies have been as sophisticated Cisco about building those systems. So I think business to business is going to be huge. But I think its a more complex selling process. And I also think that's far more likely to run into Y2K implementation issues than business to consumer. FRANCIS: But does that complexity speak beneath or a lot of solutions and that's a lot of market opportunity? RIESCHEL: Yes the market opportunity is clearly huge and the number of transactions that are occurring are huge. We just think its a more difficult, it a more difficult sell and a more difficult start to a company. FRANCIS: We've seen this week a tremendous run up off shares related to Linux and some folks have said gee associating you stock or your company these days with Linux is just like adding .com (OFF-MIKE) use to be. Have you guys looked at Linux ventures or have them pitched since your recently, and what's your feeling about Linux related business models? RIESCHEL: Yes, we've made a decision in our group that we will not invest in the Linux area per se. And the reason is that if you go back to our basic premise were investing in the services that take advantage of the Internet. SoftBank clearly the last month has demonstrated some extraordinary relationships with Microsoft. It is not that we are against Linux but it's the standpoint of we would not invest in an operating system company. We don't invest in semiconductors and we won't invest in equipment companies. And part of that's due to our large corporate relationships with Intel , Microsoft, and Cisco. So I think practically speaking I think Linux is a great thing. Clearly the market is responding very favorably to the companies that have gone public. But it's not an area that we're going to pursue. FRANCIS: I know sometimes you got to keep your cards close to the vest because you're operating in a very competitive arena. But what can you tell about anything you've seen recently that just made you think gosh we got to be in that or this is all going to be a whole, a whole new sector. What's really turning you guys on these days? RIESCHEL: Well in the last 90, in the last 90 days we've made some very large bets in communications. One was in Net2Phone which went public recently. There're several others in the messaging. Both unified messaging, global messaging, voice mail, e-mail, fax integration. I think the fact that with an IP network in place and IP equipment, the programming challenge for telephony services is so far its so much easier. It's much easier to do that programming than it is to program to the old switch interfaces. That I think that area is simply going to explode. FRANCIS: One thing that we saw a lot of for a while. Is a lot of consolidations in all kinds of Internet companies. It seems to have slowed down a little bit. What's your sense? You think we're going to see more consolidation, particularly within members of the SoftBank family? RIESCHEL: Well I think particularly within members of the SoftBank family or not. I think you are going to see a lot of consolidation. I think that you know a company like Yahoo! acquiring GeoCities Broadcast.com , clearly they're understanding how to use their currency and I think they will continue to do that. I think that other companies in the SoftBank portfolio as well as Kliener Perkins (ph) and Benchmarks (ph) and Sequoia's, you know clearly they're getting acquisitive because when you have a public market security like it is available today, and you have all these interesting companies that have been started. You have a very quick make versus by decision and the by decision is very attractive when you have the kind of public market valuation some of our companies have. FRANCIS: But with the public market also looking maybe kind of iffy right now, will that increase the chances of consolidation or decreases, hard to the handicap? RIESCHEL: I think that it will if the market gets very sketchy as we would say, I think it will increase the likelihood of a number of acquisitions and consolidations. I think that the companies have demonstrated really high sustainable revenue lines are not going to be hit that much in any market down turn and there's and obvious list of 10 to 12 companies on the net now that have literally hundreds and millions of dollars in evaluation. I think they'll be rewarded disproportionately if the market goes soft for any extended period of time. FRANCIS: All right Gary. We're going have to leave it there. Thank you very much for joining us. Good to see you again. RIESCHEL: My pleasure. Thank you. FRANCIS: Gary Rieschel SoftBank. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 888-CNNFN-01 OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT WWW.FDCH.COM LANGUAGE: ENGLISH LOAD-DATE: September 10, 1999