Many of the recent victims had perfectly sound long-term business models but were unable to bridge the gap between the first and second round of financing. Mike Murphy, MD of Ebop, claims that the company was eight weeks from breaking even when the liquidators were called in. Two unsuccessful attempts to float on AIM had not helped their market value. In the past, people looked at the internet as a whole new business model when really it was just another delivery medium. On the day Murphy had to break the news to their staff, Ebop reported their highest-ever user figures.
Flotations are now very out of fashion.
They have a fiduciary duty to their clients. That was the pre-Cambrian growth phase and this is the great extinction phase. Only those who are number one or two in their particular market will survive. Far from thinking that the internet has been overhyped, most analysts believe we are underestimating the effect it will have on our lives. Ironically, this should be the time for a spurt of growth among content providers.