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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium -- Ignore unavailable to you. Want to Upgrade?

To: DlphcOracl who wrote (99668)	4/23/2000 4:28:00 PM
From: puborectalis	Read Replies (2) \| Respond to of 108040

Parent of 30-odd dot-coms now wants to go public itself, even as the tech mania wanes by Karen Kaplan and Debora Vrana Los Angeles Times Idealab, the business incubator that has launched more than 30 dot-com companies, plans to raise as much as $300 million in one of the biggest initial public offerings (IPO) ever for an Internet company. The offering, filed Thursday, could give the Pasadena company a valuation of more than $10 billion, analysts speculated. It will also give investors a chance to own a piece of the company behind online toy retailer EToys, free Internet-service provider NetZero, Web search firm Goto.com and dozens of other Net start-ups. The company did not specify how many shares it would sell or at what price they would be offered. Idealab plans to use the money to start more companies and for general corporate purposes. The incubator has already expanded to Silicon Valley, New York, Boston and London. The Idealab IPO comes at a time when tech stocks are down generally, especially Internet incubators. Some analysts questioned taking the company public in such a volatile market. While nearly all of Idealab's offspring are losing money, the incubator itself reported a profit of $118.5 million for its 2000 fiscal year, which ended Jan. 31. The bulk of that income came from selling more than 3.8 million shares of Santa Monica, Calif.-based EToys for a gain of $193 million. But like most Internet companies, Idealab's filing with the Securities and Exchange Commission reveals it had an operating loss of $241.2 million in the 2000 fiscal year, a dramatic change from the $11.5 million loss the year before. The filing said Idealab has more than $700 million in cash and other assets on hand, which analysts called encouraging. When the company sells its shares to the public - which is expected in about two months - it should be a huge payday for founder Bill Gross. As chairman and chief executive of Idealab, Gross earns a relatively modest salary of $250,000. But the 41-year-old serial entrepreneur owns more than 351 million shares of Idealab, or about 45 percent. Four-year-old Idealab develops only businesses that it believes will serve large markets, usually with a unique twist. Idealab companies must also be able to grow quickly and efficiently, and they should give customers an incentive to refer new customers to the business. The incubator prefers to nurture companies that will benefit other firms that are already in its network, since it retains significant financial stakes in them. Its board of directors includes General Electric Chief Executive Jack Welch and Compaq Computer Chairman Ben Rosen. The bulk of Idealab's companies are in the so-called business-to-consumer realm, selling items like cosmetics, furniture, cars and even electrical power to online shoppers. Another group of companies offers free services over the Internet, such as free home pages on the Web, free access to the Net and free corporate intranets. Idealab also has spawned a few companies that make software "infrastructure," such as tools for online communication and electronic commerce. Seven of Idealab's offspring have gone public or merged with companies whose shares are publicly traded. Some of those companies, such as EToys and NetZero, are onetime high-fliers that have been slammed to Earth by skeptical investors wary of seemingly limitless losses. That could dampen investor enthusiasm for the company that hatched them, analysts said. "You look at the public companies and there's not a stellar track record," said Tom Taulli, an analyst who follows initial public offerings. But Taulli speculated that Idealab might have interesting companies in the works that it can't discuss because of the "quiet period" imposed by the SEC. "Their reputation is great," Alison Ressler, a securities lawyer with Sullivan & Cromwell in Los Angeles, said of Idealab. "But the market for these types of companies has been hard hit." Idealab was able to file after qualifying for an exemption - after much red tape - to a 60-year-old federal securities law that requires some companies to be classified as a mutual fund or investment firm because of its stakes. A company is considered an investment company or mutual fund if its investments in companies that it does not control represent 40 percent or more of its total assets. Such companies face strict SEC disclosure rules and increased shareholder rights. Copyright ¸ 2000 The Seattle Times Company

To: DlphcOracl who wrote (99668)	4/23/2000 6:57:00 PM
From: johnsto1	Read Replies (1) \| Respond to of 108040

DlphcOracle...do me a favor and restrain from proclaiming what I am or am not dead wrong or right about. All you "defend at all cost" posters carry little weight in any of my evaluation. Your not objective. Good luck with your longs,I'll be riding those buses,just not long term. If you don't like Barton Briggs or Barrons then that's your thing but it's rude to assume it should be mine. Take care and I'll see you in the winners circle.