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opportuni ties before the competition. The sooner you find such gems in the rough, the cheaper you can pick
them up, and the more you will be able to shape them in your own image.
David has shown an uncanny ability to find companies before they have attracted much attention, and has made
himself and his investors a pretty penny because of it. In January 1996 he met with David Bohnet, founder of
GeoCities, a build-your-own home page Web site. David saw a hot opportunity and wasted no time. As soon as
Bohnet finished his demo at CMGI's office he had a handshake agreement to sell a third of his company to
Wetherell for less than $6 million. Two years later, Wetherell sold his stake to Yahoo! in a deal that brought
him a net gain of more than $1 billion.
Another big win was Reel.com, a Web-based video store. David kicked in about $7 million, brought in some
additional outside investors, helped select a new CEO, and held promotional events on its affiliated Web sites to
beef up the business. He sold it for $100 million to Hollywood Entertainment in less than a year.
Mark Your Territory
In what was arguably Wetherell's best move yet, he bought into search engine Lycos when it had only one full-
time employee in 1995. He paid just $2 million for 80 percent of the fledgling online information fetcher.
David pocketed $138 million in capital gains by gradually selling down CMGI's stake. He was the company's
largest shareholder with a 17.5 percent stake in February 1999 when Barry Diller proposed merging his
television and Internet conglomerate, USA Networks, with Lycos. All but one on the Lycos board were thrilled
with the idea. David dissented. He told Boston Magazine he thought "the media companies need a portal
strategy a lot more than the portal companies need the media companies.'' He voted against the deal, and quit
Lycos's board in March.
David's move sent a clear signal about the strength of Internet media businesses. Lycos's stock rebounded after
the deal fell through; investors realized his point was valid; they were better off without the sluggish media
company. (He was proven right again with AOL's masterful purchase of Time Warner in January 2000.)
David's 17.5 percent stake would now be worth more than $1 billion. If he had not voiced his concerns about a
merger, the results might not have been so positive. Lycos's stock could have fallen further, David would have
lost money in his investment; moreover, the company would likely have changed tracks and business strategies,
with the result that it would no longer provide the same sort of partnership capabilities for his portfolio as when
he first invested.
Method to the Myriad Collection
Though David runs a conglomerate of seemingly myriad companies, he remains steadfast to his business plan of
focusing on certain business models that he thinks will make sense within his portfolio.
Marketing and Advertising
The oldest investment advice still rings true: buy what you know. The counsel isn't lost on David. While
running CMG he learned direct marketing tactics, and, as he told Business2.0 "The Internet is the perfect
channel for direct marketing." In a conference call in December 1999, David told investors, "CMGI is building
an online marketing powerhouse." In that fourth quarter alone CMGI spent more than $3 billion on acquisitions
in advertising and marketing.
One such investment was Yesmail.com, which outsources direct marketing technology for e-mail. He bought
the company in a $500 million stock swap announced in December 1999. Shareholders of Yesmail.com, which
went public at $11 a share in September, received one-eighth of a share of CMGI for each share of
Yesmail.com stock that they own.
CMGI also invested in Flycast Communications, a direct response advertising company; AdSmart, a branding
and marketing company for businesses that want to combine Internet and real world marketing and advertising
efforts; and AdForce, a direct marketing company that helps manage business Internet advertising accounts.
Community and Content
CMGI was among the first to realize the potential and importance of online content and community sites,
knowing that the tighter the allegiance to the Web site, the more frequent and longer the visits by members, and
the higher the site can charge for advertising.
Two of CMGI's most successful community-building sites are Lycos and GeoCities. Wetherell wants to take
that concept another step further with deep personalization customization, multimedia, self-publishing, and new
community platforms.
The Raging Bull investors' forum is a perfect example of an online place with which people will develop a
relationship, and to which they will return often.
Other recent investments include Oncology.com, which provides comprehensive cancer content and community
services, such as research, conferences, chat, and more. Ecircles enables visitors to create their own Web groups
based on a common interest, such as their kid's soccer league, or a local group for people who enjoy hiking and
want to organize trips to the trails. There's also Findlaw, for people in the legal profession or others who may be
interested in litigious matter; MyFamily, a Web site where families can share photo albums and update each
other on new developments for faraway relatives; and Ancestry.com, a genealogy site for families who want to
re-create their family tree. Wetherell also invested in specific, or vertical, interest sites such as Boatscape.com
and Craftshop.com.
E-commerce
An important component to a revenue-generating group of companies is commerce. After all, once you
determine someone is interested in a certain subject you can guarantee they'll be interested in purchasing
something in that category sometime.
So far CMGI has bought interests in e-merchants such as PlanetOutdoors, for gear for ice climbing;
Furniture.com, for a nightstand; and MotherNature.com, for Echinacea and vitamins in the event you catch a
cold on your trip.
If you are interested in the arts, you could log onto NextMonet to purchase a contemporary art painting and then
look into Productopia for advice on which track lighting would properly accent your new painting. After that
you could click over to BuyersEdge, where you could auction off your old couch, which no longer goes with
your new décor.
Enabling Technology
CMGI describes the companies within its enabling technology category as the glue that holds the Internet
together. They provide the strategies, designs, and technologies to help companies, both online and off, to
exploit the full potential of the Internet.
In this group are investments such as Critical Path, which controls electronic messaging, and Activate.net,
which makes streaming media technology for broadcasting, as well as1stUp, an ad-supported Internet service,
which provides the technology to target visitors' interests and provides the visitor with an ad to download.
With All Thy Getting, Get a Point of Entry
David knew that as good as his Internet companies may be, he would need a point of entry for visitors to attract
customers and usher them through to the other sites. Through a partnership with Compaq he purchased 83 [ Pobierz całość w formacie PDF ] - zanotowane.pl
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