TheGlobe.com
Encyclopedia
theGlobe.com was an internet startup
founded in 1994 by Cornell
students Stephan Paternot
and Todd Krizelman. A social networking service, theGlobe.com made headlines by going public on November 13, 1998 and posting the largest first day gain of any IPO
in history up to that date. The company's stock price collapsed the next year, and the company retrenched for several years before ceasing operations in 2008.
break and purchased an Apple
Internet Server. They founded a programming company, WebGenesis, and spent the next few months programming what would become their primary website. theGlobe.com went live April 1, 1995, and attracted over 44,000 visits within the first month. They readily recruited talent from the Cornell computer science department and had 17 employees by the site's first anniversary.
The pair used the popularity of the site and the increasing interest in the internet in 1997 to secure $20 million in financing through Dancing Bear Investments. As a result, Paternot and Krizelman received salaries in excess of $100,000 and revenues from preferred shares sales of $500,000 each. Both were 23 years old at the time.
In 1998, plans were made to take the company public. On Friday, November 13, 1998, theGlobe.com issued its IPO. The stock's target share price was initially set at $9, yet the first trade was at $87 and the price climbed as high as $97 before closing at $63.50. At the end of the trading day, the company had set a record for IPOs with a 606% increase over the initial share price. The company floated 3.1 million shares, raising $27.9 million and bringing its market capitalization
to over $840 million. Based on their holdings, the young founders were worth close to $100 million each.
During the late 1990s, theGlobe.com expanded into gaming, purchasing Computer Games
magazine, happypuppy.com (a computer gaming site), and Chips and Bits, an online store for computer and console gaming.
. In 1999, CNN filmed Paternot during a night on the town. He was shown in shiny leather pants, dancing on a table at a trendy Manhattan
night club with his girlfriend, model Jennifer Medley. During the piece, he made the statement, "Got the girl. Got the money. Now I'm ready to live a disgusting, frivolous life." He was derisively dubbed "the CEO in the plastic pants" and became a visible symbol of the excesses of dot-com millionaires.
That year also marked the change in the momentum of the dot com boom
and theGlobe.com's stock price was hit heavily. As investors grew increasingly skeptical of the "new economy", share prices began to decline rapidly. theGlobe.com saw its share price drop from a high of $97 to less than 10 cents and its market capitalization shrink by more than 95% to around $4 million in 2001.
In 2000, Paternot and Krizelman were forced out of the company and it was taken over by a former VP of the AICPA, but the company, which had never turned a profit, was forced to cut back severely. theGlobe.com shutdown its flagship site and laid off 50% of its employees in August 2001. The company continued hosting some of its partner sites and publishing Computer Games, but the domain of www.theglobe.com displayed nothing more than an informational message about the site's termination until 2003.
That year, theGlobe.com launched GloPhone, a VoIP phone service similar to Skype
, and used its eponymous domain as the product's website. Although teamed with networking site Friendster
, reviews were bad and sales were poor. A lawsuit was filed by Sprint Nextel
for patent infringement. theGlobe.com had continued publishing Computer Games and it was considered one of the top 3 PC gaming magazines in the US (along with Ziff Davis
' Games for Windows
and Future Publishing's
PC Gamer
). The company expanded its print enterprises to include Now Playing
magazine (2005) and MMO Games
magazine (2006), publications focusing on popular entertainment and massively multiplayer gaming, respectively. theGlobe.com made a decision to send unsolicited messages to MySpace.com users and was subsequently sued under the CAN-SPAM act and a similar anti-spam law in California. A California court ruled against theGlobe.com. Subsequently, the magazines stopped publication, Chips & Bits' home page announced the site's closing, and GloPhone ceased operations on March 13, 2007. The anticipation of a large federal judgement (estimated as high as $120 million) effectively spelled the end of theGlobe.com.
top-level domain
. By mid-2007, the domain theglobe.com redirected to the home page of Tralliance. The company then sold Tralliance on September 29, 2008. theglobe received earn-out rights from Tralliance Registry Management, which will constitute the only source of future revenue for theglobe.
With the sale of Tralliance, theglobe.com became a shell company with no material operations or assets.
under the symbol TGLO. Net revenue for the three months ended March 31, 2009 was $0 compared to $544,000 for the three months ended March 31, 2008.
As of the company's March 31, 2010 financial report, it had only $7618 in current assets to offset over $3.1 million in liabilities, and was running a loss of about $20,000 each quarter. Management has stated that the Tralliance earn-out must perform very well, or they will need to raise additional capital, or the company will file for bankruptcy.
Startup company
A startup company or startup is a company with a limited operating history. These companies, generally newly created, are in a phase of development and research for markets...
founded in 1994 by Cornell
Cornell University
Cornell University is an Ivy League university located in Ithaca, New York, United States. It is a private land-grant university, receiving annual funding from the State of New York for certain educational missions...
students Stephan Paternot
Stephan Paternot
Stephan Paternot is a film producer, author, and IT entrepreneur, mostly known as the founder of theGlobe.com, one of the first social networks, during the late nineties dot-com bubble.-Biography:...
and Todd Krizelman. A social networking service, theGlobe.com made headlines by going public on November 13, 1998 and posting the largest first day gain of any IPO
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...
in history up to that date. The company's stock price collapsed the next year, and the company retrenched for several years before ceasing operations in 2008.
Early success
While undergraduates at Cornell, Paternot and Krizelman encountered a primitive chatroom on the university's computer network and quickly became engrossed. Realizing the business potential, the two raised $15,000 over the 1994 ChristmasChristmas
Christmas or Christmas Day is an annual holiday generally celebrated on December 25 by billions of people around the world. It is a Christian feast that commemorates the birth of Jesus Christ, liturgically closing the Advent season and initiating the season of Christmastide, which lasts twelve days...
break and purchased an Apple
Apple Computer
Apple Inc. is an American multinational corporation that designs and markets consumer electronics, computer software, and personal computers. The company's best-known hardware products include the Macintosh line of computers, the iPod, the iPhone and the iPad...
Internet Server. They founded a programming company, WebGenesis, and spent the next few months programming what would become their primary website. theGlobe.com went live April 1, 1995, and attracted over 44,000 visits within the first month. They readily recruited talent from the Cornell computer science department and had 17 employees by the site's first anniversary.
The pair used the popularity of the site and the increasing interest in the internet in 1997 to secure $20 million in financing through Dancing Bear Investments. As a result, Paternot and Krizelman received salaries in excess of $100,000 and revenues from preferred shares sales of $500,000 each. Both were 23 years old at the time.
In 1998, plans were made to take the company public. On Friday, November 13, 1998, theGlobe.com issued its IPO. The stock's target share price was initially set at $9, yet the first trade was at $87 and the price climbed as high as $97 before closing at $63.50. At the end of the trading day, the company had set a record for IPOs with a 606% increase over the initial share price. The company floated 3.1 million shares, raising $27.9 million and bringing its market capitalization
Market capitalization
Market capitalization is a measurement of the value of the ownership interest that shareholders hold in a business enterprise. It is equal to the share price times the number of shares outstanding of a publicly traded company...
to over $840 million. Based on their holdings, the young founders were worth close to $100 million each.
During the late 1990s, theGlobe.com expanded into gaming, purchasing Computer Games
Computer Games Magazine
Computer Games Magazine was a computer gaming print magazine. It was formerly Computer Games Strategy Plus, and before that, Strategy Plus, which had been founded as Games International in the UK in 1988. While its initial focus was on strategy games, it covered a wide range of game genres...
magazine, happypuppy.com (a computer gaming site), and Chips and Bits, an online store for computer and console gaming.
Decline and downfall
As the fortunes of a number of very young people grew literally overnight, the public and the media began to scrutinize these new economy wunderkindsChild prodigy
A child prodigy is someone who, at an early age, masters one or more skills far beyond his or her level of maturity. One criterion for classifying prodigies is: a prodigy is a child, typically younger than 18 years old, who is performing at the level of a highly trained adult in a very demanding...
. In 1999, CNN filmed Paternot during a night on the town. He was shown in shiny leather pants, dancing on a table at a trendy Manhattan
Manhattan
Manhattan is the oldest and the most densely populated of the five boroughs of New York City. Located primarily on the island of Manhattan at the mouth of the Hudson River, the boundaries of the borough are identical to those of New York County, an original county of the state of New York...
night club with his girlfriend, model Jennifer Medley. During the piece, he made the statement, "Got the girl. Got the money. Now I'm ready to live a disgusting, frivolous life." He was derisively dubbed "the CEO in the plastic pants" and became a visible symbol of the excesses of dot-com millionaires.
That year also marked the change in the momentum of the dot com boom
Dot-com bubble
The dot-com bubble was a speculative bubble covering roughly 1995–2000 during which stock markets in industrialized nations saw their equity value rise rapidly from growth in the more...
and theGlobe.com's stock price was hit heavily. As investors grew increasingly skeptical of the "new economy", share prices began to decline rapidly. theGlobe.com saw its share price drop from a high of $97 to less than 10 cents and its market capitalization shrink by more than 95% to around $4 million in 2001.
In 2000, Paternot and Krizelman were forced out of the company and it was taken over by a former VP of the AICPA, but the company, which had never turned a profit, was forced to cut back severely. theGlobe.com shutdown its flagship site and laid off 50% of its employees in August 2001. The company continued hosting some of its partner sites and publishing Computer Games, but the domain of www.theglobe.com displayed nothing more than an informational message about the site's termination until 2003.
That year, theGlobe.com launched GloPhone, a VoIP phone service similar to Skype
Skype
Skype is a software application that allows users to make voice and video calls and chat over the Internet. Calls to other users within the Skype service are free, while calls to both traditional landline telephones and mobile phones can be made for a fee using a debit-based user account system...
, and used its eponymous domain as the product's website. Although teamed with networking site Friendster
Friendster
Friendster is a social gaming site that is based in Malaysia, KL. The company now operates mainly from the three Asian countries namely in the Philippines, Malaysia and Singapore....
, reviews were bad and sales were poor. A lawsuit was filed by Sprint Nextel
Sprint Nextel
Sprint Nextel Corporation is an American telecommunications company based in Overland Park, Kansas. The company owns and operates Sprint, the third largest wireless telecommunications network in the United States, with 53.4 million customers, behind Verizon Wireless and AT&T Mobility...
for patent infringement. theGlobe.com had continued publishing Computer Games and it was considered one of the top 3 PC gaming magazines in the US (along with Ziff Davis
Ziff Davis
Ziff Davis Inc. is an American publisher and Internet company. It was founded in 1927 in Chicago by William B. Ziff, Sr. and Bernard G. Davis. Throughout most of its history, it was a publisher of hobbyist magazines, often ones devoted to expensive, advertiser-rich hobbies such as cars,...
' Games for Windows
Games for Windows
Games for Windows is a brand owned by Microsoft and introduced in 2006 to coincide with the release of Windows Vista. The brand represents a standardized technical certification program and online service for Windows games, bringing a measure of regulation to the PC game market in much the same way...
and Future Publishing's
Future Publishing
Future plc is a media company; in 2006, it was the sixth-largest in the United Kingdom. It publishes more than 150 magazines in fields such as video games, technology, automotive, cycling, films and photography. Future is the official magazine company of all three major games console manufacturers...
PC Gamer
PC Gamer
PC Gamer is a magazine founded in Britain in 1993 devoted to PC gaming and published monthly by Future Publishing. The magazine has several regional editions, with the UK and US editions becoming the best selling PC games magazines in their respective countries...
). The company expanded its print enterprises to include Now Playing
Now Playing Magazine
Now Playing was a short-lived entertainment magazine that focused on popular entertainment, including movies, television, music, DVDs, and games. It was published by the media conglomerate theGlobe.com, starting life as a special section in Computer Games magazine in 2004. In April, 2005, Now...
magazine (2005) and MMO Games
MMO Games Magazine
MMO Games Magazine was a short-lived computer magazine that focused on the massively multiplayer online gaming market. It was published by the media conglomerate theGlobe.com as a sister publication to Computer Games magazine. The magazine's website was launched in June 2006, and the first issue...
magazine (2006), publications focusing on popular entertainment and massively multiplayer gaming, respectively. theGlobe.com made a decision to send unsolicited messages to MySpace.com users and was subsequently sued under the CAN-SPAM act and a similar anti-spam law in California. A California court ruled against theGlobe.com. Subsequently, the magazines stopped publication, Chips & Bits' home page announced the site's closing, and GloPhone ceased operations on March 13, 2007. The anticipation of a large federal judgement (estimated as high as $120 million) effectively spelled the end of theGlobe.com.
Tralliance
On May 9, 2005, the company acquired Tralliance Corporation, a company which maintains the .travel.travel
The domain name travel is a top-level domain in the Domain Name System of the Internet. Its name suggests the intended and restricted use by travel agents, airlines, bed and breakfast operators, tourism bureaus, and others in the travel industry....
top-level domain
Top-level domain
A top-level domain is one of the domains at the highest level in the hierarchical Domain Name System of the Internet. The top-level domain names are installed in the root zone of the name space. For all domains in lower levels, it is the last part of the domain name, that is, the last label of a...
. By mid-2007, the domain theglobe.com redirected to the home page of Tralliance. The company then sold Tralliance on September 29, 2008. theglobe received earn-out rights from Tralliance Registry Management, which will constitute the only source of future revenue for theglobe.
With the sale of Tralliance, theglobe.com became a shell company with no material operations or assets.
As a shell
The company continues to trade on the OTC Bulletin BoardOTC Bulletin Board
The OTC Bulletin Board or OTCBB is an interdealer electronic quotation system in the United States that displays real-time quotes, last-sale prices, and volume information for many over-the-counter equity securities that are not listed on the NASDAQ stock exchange or a national securities exchange...
under the symbol TGLO. Net revenue for the three months ended March 31, 2009 was $0 compared to $544,000 for the three months ended March 31, 2008.
As of the company's March 31, 2010 financial report, it had only $7618 in current assets to offset over $3.1 million in liabilities, and was running a loss of about $20,000 each quarter. Management has stated that the Tralliance earn-out must perform very well, or they will need to raise additional capital, or the company will file for bankruptcy.
External links
- theGlobe.com's current website.
- Stephan Paternot's official website
- 1999 Interview with Paternot and Krizelman