From: Adam Rifkin -4K (adam@XeNT.ics.uci.edu)
Date: Sun Jan 09 2000 - 00:32:34 PST
As a followup, here's the second round of David Wetherell posts on the
public message boards.
Got this from
http://www.ragingbull.com/mboard/boards.cgi?board=CMGINW&read=1037
The following collation are more insights posted by CMGi's CEO David
Wetherell to the Raging Bull CMGI board. Gotta love a day and age where
a company's CEO can "close the loop" by answering investors' questions
in a public forum. Once again, the rest of this FoRKpost is to be read
in "the voice of Wetherell"...
[BTW Rohit, apparently CMGi *is* open to seed scenarios...]
> @Ventures funds will consider any stage, but we prefer earlier stage,
> including seed stage. We typically do not invest less than $2-3mm in the
> first round, and we typically like to lead the round.
> ----------------------------------------------------------------------
On Community "Viral" Models
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50403
Most traditional personal publishing community models are continuing to
perform well as far as fundamental metrics are concerned. Where some
have fallen down is in monetizing the page views. Targeting
technologies, like Engage should be of great assistence in this area,
and we are just beginning to see Engage applied to this area of the Web.
Many non-traditional community publishing models, such as Ancestry's
MyFamily.com and Raging Bull, continue to grow strongly in all metrics,
including revenue. The community model is very much alive and well and
still represents one of the strongest "viral content" models on the Web.
Since AV has filed its S-1, and hence, is in a quiet period, I cannot
comment on AV related questions.
On Forms of Advertising
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50404
TV is not a bomb for Web advertisers, just some Web advertisers, which
also is true of cars, soap, cereal, etc. Of coursse, successful
advertising depends on many factors. If companies have the budget for
it, they should have an integrated ad campaign across many forms of
media, but it depends on what the product/service is that they are
offering. Longer run, an increasing amount of our time spent watching TV
and listening to radio will be interactive. This will make possible the
delivery of individually targeted ads, just like on the Internet (In
most situations, it will be the Internet). Again, Engage should play a
significant role in this future market.
On Micropayments
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50405
We perceive 1ClickCharge's approach to micropayments to be a better
solutions all around [than Compaq's Millicent], but we are looking at
ways to work with the best of both.
On Broadband
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50406
We do not see any companies limited from broadband, since once a user
has broadband access, he/she is free to go to any web site and make it
their home page. Certainly, those sites that are the default homepages
for broadband services have an advantage. It is our goal to get our
sites to be the default homepages to as many users as possible. This can
happen in many ways, including through our partnerships in Asia, MyWay's
deal with Bell South, and upcoming DSL offerings through our own network
service, NaviNet. We are continuing to pursue other such opportunities
around the world.
On Ad Rates; Also, Raging Bull
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50407
Advertising deals are typically for a fixed amount of impressions or the
advertiser will take all available impressions up to a limited number.
Raging Bull pages views will be included in with the ALTA (and hence
CMGI) Network as soon as the deal is closed, which is anticipated to be
by the beginning of February.
On CMGI's Direct Share Program
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50410
I am no securities law expert, but my understanding is that non-U.S.
resident shareholders participating in CMGI's IPO's is not possible.
Sorry.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50409
The program now allows for up to 500 shares per person, I believe,
depending on demand. Since the demand has been so great, no one has been
able to get more than 100 shares. It is our goal to provide as many
shares as possible through this program, but we need to keep a
significant amount available for the institutions, as well. It's amazing
to me that some people do not seem to understand that the company can
only offer a finite number of shares. Several times I've heard the
question, "Why don't you provide everyone who wants 100 shares with the
shares?" For those who still wonder that, it's simply because the
individual companies going public are only selling so many shares (or
put another way, raising a certain amount of money), and shares must be
set aside for institutions, as well.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50411
This is a program to benefit the smaller investor, especially those that
have been loyal to the stock for a long time. Because of the split and
the heavy demand in the past for the DSP program, we felt it was best to
make it 200. I realize this is a stretch for most just getting into the
stock. It certainly does reward the smaller investors who have been in
the stock for a longer period. I believe long term loyalty should be
rewarded, too. If there was a way to reduce the volatility caused by
day-traders with this program, I would do so. Even my stomach has
difficulty on occasion, such as today. ;)
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50413
There are no plans to replace WIT for the DSP. Certainly, the first time
we tried the DSP with Engage, there were many problems, some of them
with WIT, and we heard about them. The complaints far exceeded the
thanks, even though roughly $12mm of shareholder value was created.
We listened hard to the complaints, we met with WIT, decided on ways to
improve the service, tried it one more time with NaviSite, and found
that the complaints were greatly reduced, while the number of
shareholders expressing their appreciation increassed dramatically.
This program is alot of work, and we are reviewing whether or not it is
worth it. Our business is to create as much shareholder value for all
shareholders, not just those that are fortunate enough to receive this
dividend. Despite how smoothly NaviSite went, and despite how much
shareholder value was created for those that did receive shares, we may
not continue the program after ALTA, because of the dissatisfaction
created for some of those that do not receive shares. They create a
tremendous amount of work for Investor Relations.
For those of you who did not receive any shares, let me say I am sorry,
especially if you have been long term shareholders. The good news for
the long term shareholders is that you have been more than handsomely
rewarded by the exceptional performance of CMGI. For those of you
fortunate enough to receive the shares, I hope the benefit outweighed
the difficulty of obtaining the shares. If you still own those shares, I
know it has. We will continue to try to improve upon the process. I know
WIT is doing the same.
In closing, please realize we are trying to do a good thing that to my
knowledge had never been done before. Given the difficulties
encountered, I think I know why it's never been done. There really is no
financial upside in this for CMGI, but there is the good feeling that
comes from knowing we have done a good thing for some smaller investors.
Despite the problems encountered, I know there are many out there that
have benefited that could really stand to benefit. That's a good thing.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50460
All shareholders have an equal opportunity to get DSP shares. If we
allocated them in a prorated fashion, as you suggest, the institutions
would get 60 percent of the shares and employees would get roughly 20
percent, leaving everyone else to try their best to get the remaining 20
percent. With Engage, I think we only had 600,000 shares to work with in
the program. That would leave only 120,000 shares, or enough for 1200
shareholders at 100 shares each. With the way we did it, 6,000
shareholders benefited.
I'm sure the employees did not care, as they also have shares/options.
I'm sure the institutions did not care at the end of the day if they did
not get their prorata share, since they already get IPO shares. Also, it
is my guess they would rather invest in a company that is watching out
for the greater good of the greatest number of its shareholders. IMHO.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50490
OK, OK. The DSP program will live on forever (unless the board makes me
eat my words - unlikely), despite its drawbacks. I am convinced by the
overwhelming support on these boards for the program that it is a key
asset of our overall strategy. Many thanks for your helpful posts. We
will continue to try and make the DSP program better.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGIOT&read=59058
The first thing Jack Welch (chairman/CEO of GE, of course) said to me
when we met was his wife loved the CMGI DSP program, and he thought it
was really a neat idea. Though she is not exactly the target, I thought
it was great she appreciated it. I guess she has a WIT account. ;)
On iCast
[Adam: here's the screenshots of iCaster... cool...
http://members.home.com/cyberkid/icast.html ]
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50414
We are not revealing more about our plans for iCast than we have
already, which is that it is our goal to be the number one entertainment
portal on the Internet. That will not happen overnight, but from what
I've seen and what I know of the immediate and future plans, I think the
goal is attainable. We showed iCaster at our recent Annual Shareholder
Meeting, and overall we are pleased with the feedback. I think Margaret
Heffernan, the COO of iCast who demoed it was just pleased the early
beta code didn't crash. ;) a testament to the fine work being done by
the iCast team.
They are pulling together a tremendous amount of work. What you will see
day one will only be the beginning of a long range set of services and
features that will unfold over several months and years.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50415
All artists will be welcomed at iCast.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50416
The Web is about empowering the individual. iCast and iCaster will
follow suit.
On CMGi's @Ventures VC Arms
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50417
Each of the new funds will have the ability to invest in later stage
deals, though we will probably continue to invest mostly in earlier
stages. We may still set up a crossover only fund.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50418
The assumption that @Ventures keeps all the for-sale securities may not
be a valid one. We are reviewing and evaluating the best ways of setting
up @Ventures, Inc. for a subsequent IPO to determine if it is really the
best thing to do. It is too early to speculate on constructs.
Our reason for filing to sell up to $1B in securities was to have more
expansion capital available for the opportunities that we see.
I do not see how @Ventures being an "Inc." would affect the operating
companies in any way but a positive one, inasmuch as we would only do it
if it were to make @Ventures stronger. This would provide more leverage
for the operating companies, since they enjoy a first mover advantage to
incorporate or service our investments.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50419
Other than the International funds, CMGI will be the sole limited
investor all of the new funds. We retain the right to add other limiteds
for subsequent funds. For the International Funds, it is anticipated
that we will have a small number of strategic partners.
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50420
@Ventures funds will consider any stage, but we prefer earlier stage,
including seed stage. We typically do not invest less than $2-3mm in the
first round, and we typically like to lead the round.
On MotherNature.Com
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50421
I like Mother Nature's service overall, although when I went there to
reorder recently, it was not readily apparent where to find the "What
Ails You" content, which I thought was their long suit. (I wanted to
find a cure for declining stock price.) An @Ventures partner sits on
their board and I send them ideas on how to improve the site/service,
but I do not hear back. I'll keep trying. In all fairness, they were
about to go on their roadshow when I last sent a set of ideas.
In addition, last I checked, MyWay.com was promoting their site.
On CEOs Using Public Message Boards
http://www.ragingbull.com/mboard/boards.cgi?board=CMGI&read=50443
Official thanks to Zbeach's team, which I just found out from an email
was: lvlamb, Zen, CurveRider, Sentinel, and Aircooled. Clearly, there
has been great cooperation all around from the broader community team,
and for that, thanks. Believe me, this is very useful for me, too. I
sincerely learn a great deal on these boards. I recommend it to any and
every CEO out there.
---- Adam@4K-Associates.comCommercial software companies spend a great deal of effort to maintain backwards compatibility; in many cases, e.g. Microsoft operating systems, this is widely belived to be at the expense of quality and usability. Re-use is a powerful tool, but one should not always maintain legacy code at the expense of quality and future maintenance. I believe the Gale system is a reasonable design that can, with incremental changes and additions, meet the needs for a messaging system in the foreseeable future. In this documented I have presented the case for the (admittedly disruptive) switch from Zephyr. -- http://gale.org/why.html
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