The Pot of Gold
INTERNET
ina y, the
Pot of Gold
Profits arrive for dot-com survivors with critical mass and products that need shipping only in cyberspace ver since internet stueks began cratering two years ago, iiivestury have been making mental lists of ideas they shouldn't believe in anymure: selling goods for less than they cost, for example, or companies with %2 million in sales being worth $2 bilHun.
But the most important Internet idea of all may be due for revisiting. As it turns out. Web companies can make money—a lot of money—once they get big enough. At least 52 of the roughly
201) public Internet companies ^ ^ _ that survived t he shakeout of the i)ast two y ears a re profitable now under standard accounting rules, and 15 to 20 more are likely to become so by next year. Not su long ago, only online auctioneer eBay Inc. and a few software and consulting fÜTOs helping drt!amei*s build e-stores saw black ink. Now, there are money-making Internet c(im|)anies in
E
Internet Veterans
Are Starting
To Cash In
Añer more than a few bumps. Web companies are turning profitable.
Once they're in the black, earnings can rise quickly because each extra sale requires little new spending.
travel, finance, and a host of o ther industries. Four Web companies made this year's ranking of the Info
Tt'cli 100: search engine Overture Services (No. 73), auctioneer eBay (83). discount-hotel broker
Hotels.com (86), and travel site Expédia
(87). That's up from a measly one last year.
Anil all uf them a re making money.
The leaders of the
Web pack are s tarting to show that once they turn profitable, they can quickly become big moneymakers. The reason is operating leverage. That's accounting-speak for a simple concept: Once you invest enough tu build a Web site and your basic operations, you don't need tu spend much money as sales rise. After you cuver your fixed costs, the expense of processing each sale is so little that
ina y, the
Pot of Gold
Profits arrive for dot-com survivors with critical mass and products that need shipping only in cyberspace ver since internet stueks began cratering two years ago, iiivestury have been making mental lists of ideas they shouldn't believe in anymure: selling goods for less than they cost, for example, or companies with %2 million in sales being worth $2 bilHun.
But the most important Internet idea of all may be due for revisiting. As it turns out. Web companies can make money—a lot of money—once they get big enough. At least 52 of the roughly
201) public Internet companies ^ ^ _ that survived t he shakeout of the i)ast two y ears a re profitable now under standard accounting rules, and 15 to 20 more are likely to become so by next year. Not su long ago, only online auctioneer eBay Inc. and a few software and consulting fÜTOs helping drt!amei*s build e-stores saw black ink. Now, there are money-making Internet c(im|)anies in
E
Internet Veterans
Are Starting
To Cash In
Añer more than a few bumps. Web companies are turning profitable.
Once they're in the black, earnings can rise quickly because each extra sale requires little new spending.
travel, finance, and a host of o ther industries. Four Web companies made this year's ranking of the Info
Tt'cli 100: search engine Overture Services (No. 73), auctioneer eBay (83). discount-hotel broker
Hotels.com (86), and travel site Expédia
(87). That's up from a measly one last year.
Anil all uf them a re making money.
The leaders of the
Web pack are s tarting to show that once they turn profitable, they can quickly become big moneymakers. The reason is operating leverage. That's accounting-speak for a simple concept: Once you invest enough tu build a Web site and your basic operations, you don't need tu spend much money as sales rise. After you cuver your fixed costs, the expense of processing each sale is so little that