September 27, 1999 6:15 PM PDT
AltaVista to climb new heights with IPO
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CMGI to acquire free ISP 1stUpSeptember 27, 1999
According to CMGI chief executive David Wetherell, CMGI will file to take AltaVista public near the end of October. Speaking on conference call to reporters and analysts, Wetherell said he hoped to launch the public offering in January.
The decision marks a quick turnaround for Web holding company CMGI, which completed its $2.3 billion dollar purchase of a majority share in AltaVista just last month.
But it also highlights just how seriously Wetherell takes AltaVista as the newfound centerpiece of the CMGI's Web strategy, which rests on integrating dozens of its disparate companies and services as tightly as possible.
"The reason AltaVista was so attractive in the first place was that there was so many synergies," said Deidre Moore, a spokeswoman for CMGI. "It will be an important driver of traffic for our properties."
CMGI's overall strategy has long rested on investing in prominent Web companies, building them up, and taking them public. Notable early successes include early stakes in Lycos and GeoCities.
The company has acquired many companies outright. But it also has invested in a wider variety of smaller companies though its venture capital arm, called @Ventures. Based in Menlo Park, California, this division now has a stake in close to 40 different companies.
Wetherell said today he would create four new venture funds that would increase CMGI's ability to invest in promising companies. Two of these will be regional, concentrating on firms in Europe and Asia. The two other funds will focus on e-commerce companies and Internet start-ups, respectively.
But since its purchase of AltaVista, the company has also refocused attention on creating a kind of crown jewel in this network of companies, which can share its enormous Web traffic with smaller sites and serve as a host for CMGI affiliate companies' services.
Those affiliate companies are diverse, from stock site Raging Bull to Web advertising network Adsmart.com. Today, CMGI expanded this list, agreeing to acquire free ISP service wholesaler 1stUp.com. That company will be used to provide CMGI companies and partners with their own branded ISPs service, similar to what AltaVista already operates, executives said.
The focus has already changed the look and feel of AltaVista, which was previously operated by computer manufacturer Compaq. Several new services have been added every month since news of the CMGI acquisition hit the streets, including the free ISP service, as well as several new categories and content channels.
But that's just scratching the surface, AltaVista and CMGI insiders say.
An altogether new version of AltaVista is slated to launch in October, which will include far greater integration with other CMGI properties.
Launching at the same time will be an extensive effort to "rebrand" the site, including a multimillion-dollar marketing campaign aimed at Web-savvy users, sources have said.