In 1994, six Stanford University students created a primitive search engine called Architext.
The following year, Stanford alum Vinod Khosla, who had joined venture capital firm Kleiner Perkins Caufield & Byers, secured $1.5 million in financing, followed by another $1.5 million from Geoff Yang of Institutional Venture Partners.
In December 1995, Architext was re-launched as Excite -- the search engine to end all search engines.
At the beginning of 1996, Excite strengthened its brand by bringing on a CEO
with absolutely no dot-com experience whatsoever -- former documentary filmmaker George Bell. Bell’s first move was to acquire two other search engines, Magellan (the purchase price wasn't disclosed) and WebCrawler for $19.8 million. Months later, on April 4, Excite went public with an initial offering of 2 million shares at $8.50/per. The company garnered distribution deals
with Netscape, Microsoft
(MSFT), and Apple
In October 1997, Bell pulled the trigger on another purchase
, scooping up comparison-shopping-service company Netbot for $35 million.
Soon after the Netbot deal, Bell bought iMall
for $425 million in stock and online-greeting-card company Blue Mountain Arts
for $780 million. In 1998, Bell dropped an undisclosed amount to sponsor
Indy driver Eddie Cheever Jr.
In 1999, Larry Page and Sergey Brin, the founders of Google
(GOOG), decided that their creation was interfering with their studies and offered it to a slew of companies (including the defunct Alta Vista, which passed, and Yahoo
(YHOO), which also passed, but had a strong enough product that they were able to stay afloat with their own technology). An offer was then made to Excite’s George Bell, who deemed the asking price of $1 million too high. Vinod Khosla of Kleiner Perkins went back for another attempt -- this time for $750,000 -- and was thrown out of Bell’s office.
On September 21, 2000, George Bell stepped down as Excite’s CEO. The stock was trading at $15.38 a share -- down from $128.34 a share in the first quarter of 1999, a 90% drop in value.
Gone were the heady days of Excite’s $35 billion market cap.
By the time the third quarter of 2001 rolled around, Excite stock had fallen to $1 a share. Chapter 11 bankruptcy came next.
"They don't have any defensible proprietary content that anybody really needs," Patrick Keane, an analyst at online research company Jupiter Media Metrix, said
at the time. "They have a huge database of names, and a direct marketer might want to purchase that."
it had "initiated a wind-down of Excite.com and other portions of the Excite Media Network."
Google is now the undisputed leader in search, with 65.4% of all Internet searches and a market capitalization of $167.5 billion. The closest competitor in the search space is Microsoft’s Bing, with 11.3%.
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.