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Technology Stocks : CyberCash a buy? -- Ignore unavailable to you. Want to Upgrade?

To: PeterR1700 who wrote (1719)	7/14/1998 6:51:00 AM
From: jjs_ynot	Read Replies (1) \| Respond to of 3990

A sale of 100000 shares by Mr. S Elefant was reported to SEC on July 2. Who is this, the CEO?

To: PeterR1700 who wrote (1719)	7/14/1998 8:56:00 AM
From: chirodoc	Read Replies (1) \| Respond to of 3990

Formerly Web Week Search IW Weekly Newsletter Sign up for the free Internet World Weekly Digest E-mail newsletter! July 13, 1998 CyberCash Cuts Staff; Is Sale Next Step? Layoffs blamed on merger with ICVerify, but analysts question company's viability By Whit Andrews CyberCash has trimmed its U.S. workforce by about 20 percent as its executives insist that the company's star is on the rise. The company, which now specializes in clearing credit-card and electronic-check transactions for Web stores, remains on target to sign up 10,000 merchants by year's end, said Maureen Loftus, senior vice president of corporate marketing and strategy. "The layoffs were across the board," Loftus said. The company recently completed its merger with ICVerify, and there was overlap among some positions, she said. About 200 staff remain in the United States, and 100 developers are based in India. CyberCash also adopted late last month a poison-pill provision to ward off unwanted buyers. And the company recently announced a pilot project for the fall with Digital City in which Washington, D.C.-area users are to pay their utility bills through the Digital City site. It's brave talk and action for a company that cracked $2 million in revenue for the first time in the quarter including Christmas 1997, and which has stated it expects losses to remain significant, although not exceeding about $5 million quarterly, for the foreseeable future. Most of its revenue comes from the transactions it reconciles for Web sites, which pay an initial setup fee. Banks then pay CyberCash a cut of every transaction the company clears. Some comes from ICVerify's real-world in-store credit card terminals, in which the company is a distant second to Hewlett-Packard subsidiary VeriFone. Analysts are bemused at the company's longevity, and many expect it to sell out shortly to a protector. "Right now, they just have to position themselves to be bought by a larger company," said Chris Gwinn, an analyst at the Yankee Group. "I think that's what they're trying to do." CyberCash's challenge is that having been an early entrant in the electronic-commerce business, it must now make money at tasks that others have joined it in performing. Clearing credit-card transactions was an unusual trick three years ago, but is now offered as part of various software packages for online storefronts (albeit sometimes through CyberCash even then). The company was also among the first to recognize the likely value from paying for things bank-to-bank online the way people use checks in traditional transactions. But its PayNow service, which allows such transactions, is well ahead of the market and may not catch on for some time-maybe until competitors catch up. "They are first-to-market with interesting and good technologies, but it seems that time and time again the market got away from them," said Scott Smith, an analyst at Current Analysis. He pointed, as an example, to CyberCash's entry into bill presentment ahead of MSFDC, a joint venture between Microsoft and First Data Corp. "Along comes MSFDC and does a cannonball into the pool," Smith said. "Sure, CyberCash has active customers and MSFDC has none. That still doesn't change the perception that runs counter to CyberCash's business case." To be sure, all is not lost. CyberCash had more than $30 million in the bank at the end of March, the date of its last public filing showing the figure. If it meets some performance goals, it will get a second cash infusion from Rose Glen Capital Group, a Wayne, Pa., investment group that injected $15 million into the company in February. CyberCash also has a record of reacting quickly to market changes. Now facing Microsoft's intention to hand out a free "wallet" for financial transactions over the Internet, CyberCash hints broadly that it is pursuing a relationship with a search site to provide a free co-branded wallet for users. Tying its brand to more powerful ones like the search engines could prove the salvation for CyberCash, which has strong technology and product lines but trouble developing the widespread recognition that drives success in the small-business, retail, and consumer markets, Smith said. "If you're going to hand something out," Smith said, "you might well want to hand it out at a busy intersection."