SAN FRANCISCO – Salon.com, an online publication and community site, went public June 22, offering 2.5 million shares at $10.50 apiece. The company’s stock priced at the low end of its $13.50 to $10.50 filing range.
W.R. Hambrecht & Co. and Daiwa Securities America Inc. underwrote the initial public offering, which left 10.73 million shares outstanding.
There were no selling shareholders. Adobe Ventures I and II, H&Q Salon Investors, Constellation Venture Capital, Wasserstein Adelson Ventures and DOTCOM Ventures were venture backers.
Salon.com produces 10 Web sites for different demographic targets and a variety of online communities designed to attract premium Internet advertisers and electronic commerce partners. While much of Salon.com’s revenue is derived from advertising sales, the company is trying to expand its network of distribution partners and increase its e-commerce revenue.
The estimated $26.3 million in proceeds generated by the offering will be used to expand the company’s sales force, improve its business operations and technology infrastructure and for other general corporate purposes.
Salon.com has not been profitable in recent years, losing $6.2 million in the fiscal year ended March 31, 1999 and $3.8 million in fiscal 1998.
Standish O’Grady, managing member of H&Q Venture Associates, joined the company’s board of directors in December 1995, followed in November 1997 by Sada Chidambaram, president and director of ASCII Investment Management, manager of DOTCOM Ventures. Ron Celmer, managing partner of Bear, Stearns & Co. Inc. and general partner of Constellation Ventures was named a board member in April.
Salon .com – Selected Financial
(in thousands, except per share data)
Year Ended March 31,
1997 1998 1999
Net revenue 280 1,156 2,921
Net loss -1,944 -3,825 -6,233
Net loss per share -3.84 -10.20 -16.62