Founders Buy Back Webshots
Three young entrepreneurs who struck it rich during the dot-com boom took a stab at capitalizing on the high-tech crash Friday by paying $2.4million for online photography site Webshots--the same service they sold to Excite@Home for $82.5million in late 1999.
Webshots co-founders Andrew Laakmann, 32, Narendra Rocherolle, 33, and Nicholas Wilder, 29, reclaimed ownership of the service when U.S. Bankruptcy Judge Thomas Carlson approved the sale as part of Excite@Home’s liquidation. Redwood City, Calif.-based Excite@Home plans to go out of business in March.
For Excite@Home, Friday’s deal represented another humiliating reminder of how badly the Internet economy has crumbled since the company went on a multibillion-dollar shopping spree in the late 1990s.
Before selling Webshots at a 97% discount from the price it paid in October 1999, Excite@Home sold Excite.com for $10 million and let go of online greeting card service Blue Mountain for $35 million. Excite@Home paid $6.7 billion and $780 million, respectively, for those two sites in 1999.
For Laakmann and his partners, the Webshots deal represents an opportunity to keep their creation alive and make more money.
The partners predict Webshots will be profitable within 60 days. They say their confidence is well-founded because the site made money soon after it was started in 1996.
To generate revenue, Webshots plans to charge for some services. The rates have yet to be determined. Many services will remain free for the site’s 13 million registered users, Laakmann said.
After selling Webshots, the three co-founders continued to work on the site as Excite@Home employees.
To buy back the site, the Webshots co-founders formed a limited partnership, Two Fold Photos.
When it bought Webshots, Excite@Home paid Laakmann and his partners in stock--a currency that plummeted from a split-adjusted high of $59.75 in late 1999 to 15 cents before the company’s September bankruptcy filing.