Who Wants to Be a Billionaire?

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That's why Mishek says she doesn't see bluemountain.com as Hallmark's online competition. Instead, gift sites like amazon.com and disney.com pose a bigger challenge.

American Greetings's online subsidiary and E-greetings.com presumably have similar strategies, though neither company could comment for this article because both have announced plans to seek public investment and so are in their federally mandated "quiet period."

E-greetings was co-founded by Tony Levitan, a former marketing bigwig at Leo Burnett. Although he's no longer with the company, Levitan once said its goal was to "provide a combination of demographic and psychographic data about the consumers using our service" to advertisers. Not exactly the touchy-feely approach.

If bluemountain.com cards are overly folksy, E-greetings.com's selection seems excessively hip. In addition to traditional holiday cards, it features everyone from Austin Powers to Christina Aguilera, complete with Shockwave sound samples of her "Genie in a Bottle." It may be cool to hear, but it's a drag on an older computer's resources. Plus, it's more of an online advertisement than a greeting card -- you and your intended recipient are only one click away from purchasing her album.

American Greetings currently has partnerships with Web portal Lycos and America Online, in addition to its own Web site that offers the opportunity to create and print your own free cards. It also sells various cards.

Jared Schutz soon recognized that like these companies, bluemountain.com had endless opportunities. But he and his parents also recognized that their resources to pursue them were limited.

The Schutzes seriously considered an IPO to raise capital, perhaps as much as several billion dollars, but it was a "long, risky haul," Jared says. "If Internet valuation metrics radically changed between now and our public offering, we would have been screwed."

Besides, going public also would have meant "bringing in a bunch of suits," which would have been somewhat at odds with Blue Mountain's Boulder-friendly, traditionally laid-back work environment.

So instead, the Schutzes began listening to potential suitors. Bluemountain.com's traffic made it a very attractive proposition.

Particularly to [email protected]

[email protected] is a company with two interrelated missions: It is a Web portal like Yahoo!, which includes a search engine and a plethora of features and services for visitors, and also an online access point for super-high-speed cable modem Internet access (which AT&T Cable Services says won't be available throughout Denver until sometime next year).

The price that Excite paid for bluemountain.com -- $350 million in cash and $430 million in [email protected] stock -- was remarkable, but less than other offers, according to rumors circulating before the sale. The Wall Street Journal had the rumored asking price as high as $1 billion. It also cited such potential suitors as Massachusetts-based CMGI, an Internet conglomerate, and eToys Inc. (CMGI denies it had any interest in bluemountain.com; an eToys spokesman says only, "It's our company policy to not comment on rumors and market speculation.")

If bluemountain.com attracts enough visitors during the holiday season, the Schutzes could also qualify for stock bonuses, pushing their $780 million windfall closer to $1 billion.

What made bluemountain.com so valuable to [email protected]? The company certainly didn't have assets or revenues that equaled nearly a billion dollars -- not in the old way of valuing a company, at least.

But according to Tom Taulli, senior analyst for the Internet Stock Market Report in Santa Ana, California, the traditional variables of estimating a company's worth go out the window with the Internet. In the old way of thinking, a company's worth is set as a multiple of various factors -- its earnings, its assets (such as real estate or technology), or even its revenues. "The problem with Internet companies is you don't have earnings," he explains. "So you look at revenues. You don't have revenues, so you would look at the industry norm." And in the Internet industry, everything seems to be built on buzz. "Leaders tend to stay leaders," says Taulli.

According to a study published by the Stanford University business school on how corporate executives estimate the value of Internet stocks, the way companies are valued today "may be totally anachronistic by the end of next month."

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Chris LaMorte