posted 10-08-1999 11:04 AM         

Excerpts:
Their business model based on the theory that verticality is the key to the future of the Internet in terms of content sites. So the homepage is usually not the starting site - a specific member of their network is. They get great press, but it's about the specific sites, not the internet.com brand. They don't mind because the advertisers know about it and the readers know about it and our traffic grows with very, very, very little promotion.

In other words, except for shareholders, they don't care if their brand is unknown. CEO Mercker said "I couldn't care less. The more important thing to me is that IBM knows about it and other advertisers -- there are over 600 advertisers that we have on our site that are growing by a hundred every quarter with 90% retention rate".

Regarding profitability, Mercker says they are one of the few sites that can actually state that it will be profitable sometime in the year 2000 off of banner advertising. The reason he gives: "When you have a business-to-business site such as ours where the only people that would possibly populate our site our read our pages would have to be somebody who's fairly heavy duty, you don't have a problem attracting reasonably high to very high cpms whether it be for traditional banners, e-commerce affiliate programs, and/or email news letters...The other thing to look at, and of course we are a public company so I can't specifically state where our revenues are going, but we will be reporting our revenues on Oct. 20th for the third quarter and you're going to see that in terms of anything that has been written about us, we're going to blow away all of the numbers."

They've also set up an internet.com VC fund (and will start a second soon) to invest in startups, kind of like a small CMG or ICG.