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To: KeepItSimple who wrote (46889)	3/23/1999 10:43:00 AM
From: Mark Fowler	Respond to of 164684

Never mind...

To: KeepItSimple who wrote (46889)	3/23/1999 2:53:00 PM
From: Glenn D. Rudolph	Respond to of 164684

21 The Internet Capitalist Manifesto Why “Capitalist”? The Internet is interesting and hip. It's also popular and cool. Unfortunately, recognition of these facts wouldn't have necessarily made you much money over the last few years. Indeed, an investment strategy based on these gleanings would have left you with a portfolio of Java, VRML, and “push” technology vendors. And though each of these might have created shareholder value on the margin, none would have compensated you for the risk inherent in Internet investing or for the opportunity cost of not being more fully invested in profitable Internet themes. Our goal, then, with “The Internet Capitalist” is to identify and profit from the dislocations that the Internet has created for businesses and consumers alike. We start by asking three basic questions: Which companies have identified the revenue opportunities created by the Internet's growth as a consumer and business medium? Which have the skill sets and management breadth to execute against these opportunities? and Which have business models that will create substantial shareholder value over time? Our answers to these questions should help you capture the arc of our thinking in this industry as it evolves from a network for academics into a medium for the masses. Why “Companion”? We hope this piece asks as many questions as it answers, and generates as much debate as it satisfies (which we plan to include). Coupled with a user friendly layout, we want “The Internet Capitalist“ to stimulate and ease the investment decision. The mental framework with which we parse Internet investments is defined broadly and driven by a few relatively simple themes. Within this framework, however, there are multiple paths to generating superior, above-market returns. “The Internet Capitalist” is our attempt to illustrate those paths on an ongoing basis, determine the commonality among them, and suggest how shareholder value will be impacted and where it will flow. And though you'll find us to be bullish on the Internet sector generally, our expectations for these stocks are tempered by three realities. First, that the market remains relatively inefficient for these securities, which makes taking a substantial ownership position both difficult and costly. Second, valuation levels leave little to no room for errors of execution or strategy. Third, profits (or cash flow) matter; progress toward meaningful profitability is a necessary condition for an increase in shareholder value. With those caveats, we still believe investors can achieve superior returns based on a patient, disciplined, long term strategy toward investing in this sector. We hope “The Internet Capitalist” becomes an indispensable tool toward that end.