While Web content providers continue to struggle to create the right revenue-producing business model, the easiest way to make money on the Internet is simply to go public. On Friday, Web site tool vendor Allaire Corp. did just that.
Allaire completed its initial public offering (IPO) of 2,500,000 shares, which opened at US$20. Within three hours, Allaire was selling at $40 1/2.
However, one industry analyst, somewhat tongue-in-cheek, was not impressed.
"In today's market doubling your stock price on opening day is almost a sign of failure," said Jim Balderston, an Internet industry analyst at Zona Research Inc., in Redwood City, California.
Balderston amended his initial comment by saying that where stocks are related to value, a 100 percent gain would be impressive, but with stocks from start-ups going up in some cases in excess of 400 percent on their first day, doubling the price does not seem all that spectacular.
In the first nine months of 1998, Allaire lost $7,988,000 on revenues of $13,903,000.
The company was started about three years ago by two brothers -- J.J. Allaire, who is currently chairman and executive vice president, and Jeremy Allaire, who is vice president.
Allaire offers two products, the ColdFusion Web and HomeSite, which help organizations connect company information systems to the Web and also develops Internet commerce applications.
Allaire Corp., in Cambridge, Massachusetts, can be reached at http://www.allaire.com/.