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To: cyberman who wrote (742)	3/26/1999 3:47:00 PM
From: steve harmon - analyst	Respond to of 4337

The firm hosts 5 million email accounts now across 100,000 domains and uses load-balancing to keep the mailflow flowing smoothly. But we think the real market is ahead. If you consider the 10 million small-to-medium sized businesses in the U.S., the Fortune 500, the global companies, the increasingly-sophisticated email offerings to come, then the market for Critical Path seems ahead in many ways. Makes complete sense, rather than have a staff on hand twiddling with the email servers day and night why not let another do it. Same reason why companies don't have telephone technicians standing around keeping the dial-tone going. Risks? plenty of course. rivals aren't idly standing by: USA.NET and iName are two well-known challengers with strong footholds with portals and companies. There's also the Y2K bug. Nobody really knows what it could do to email routing as the new millennium draws near. And the nearly 5,000 U.S.-based ISPs may be content providing clients with email as part of their daily bread. Investors in Critical Path include Mohr Davidow Ventures, Benchmark, CMG@Ventures, E*TRADE, US West. While early documents don't say how many shares will be offered at what price. We estimate that based on the IPO market now and given the target amount it wants to raise that Critical Path could seek a valuation of about $300 million on IPO market cap (its pricing) The after-market has been strong for Internet issues with lesser-potential candidates doing extremely well. This more mission-critical service could offer more bang in our view, especially over time. More analysis as this one makes its way through the IPO pipeline.