Evite's hopes stirred; Geocast interred

The invitation Web site is courting suitors for a cheap buyout, while Geocast rivals are recruiting employees at the floundering company.

4 min read
For those of you tired of hearing me carp about February as though it were the longest month of the year, you'll be happy to hear that spring has decisively sprung here in San Francisco. The sun is shining, the fog is far out at sea, and from the top of San Bruno Mountain, with a pair of good binoculars, you can make out a string of commercial For Rent signs all the way to Mountain View.

It looks like those of us afflicted with full-blown Seasonal Affective Disorder are not the only ones eagerly anticipating a long-awaited reprieve. The winter of Evite's discontent is on the verge of coming to a close, Skinformants tell us--though the continued chill gripping the market for dot-coms is bound to result in some cold comfort for the pioneering invitation Web site.

Starting in November, Evite was clearly up for sale. As competitor Mambo.com went dark and portals including Yahoo and AOL easily engineered their own knockoffs, Evite hired San Francisco investment house Hambrecht & Quist to find it a home.

H&Q has succeeded as an agent, Skinformants say, scoring Evite auditions with the likes of AOL, Yahoo, Excite, and NBCi. Some of these megaportals already had their own invitation service, but Evite might have brought them valuable engineering talent, extra eyeballs and a brand that has the currency of Kleenex in the Web-based invite universe.

But all of the above took a pass on Evite. Skinsiders also ruled out About.com, which signed a co-branding agreement with Evite in June.

Evite finally has found a couple of serious suitors and is excruciatingly close to inking a deal. Rumor has it, however, that buyers are eyeing fire-sale prices--to the basso profundo tune of seven figures.

Evite and H&Q declined comment on the negotiations. But sources close to the action describe Evite board members and management as pleased with their prospects--considering present market conditions. After all, you can do a lot worse these days than sell your dot-com for cheap. Just ask eToys, where the .com edition of Monopoly is selling at 63 percent off.

Or you could ask Geocast Network Systems, the Mayfield- and Kleiner Perkins-funded venture rumored to be shutting its doors this week.

Geocast was the talk of the Valley when it launched a few years back, because it brought a slew of Netscape engineers into the fold. Geocast was building a device to receive cached Web pages, video, software, music files and what have you from terrestrial and satellite digital broadcast sources. The company has about 200 employees at present, having slimmed down after 20 percent layoffs earlier this year.

Skinformants say the company--not available to return the Rumor Mill's calls--ran clean out of money after failing to secure a new round of funding. Geocast burned through its second round--$74 million courtesy of Allbritton Communications, Royal Philips Electronics, Mayfield, Kleiner and Institutional Venture Partners--in less than a year.

"Basically the company ran out of money, and in the current climate they can't get more," said one Skinsider. "That's the bottom line. But the concern with management didn't help."

That concern centered around a prolonged game of musical chairs in the executive corridors, as Chairman Joe Horowitz yielded the throne to DirecTV alum Jim Ramo, only to take it back months later. In addition, co-founder and Kevin Mitnick nemesis Tsutomu Shimomura and several other executives left or scaled back their involvement with Geocast (Shimomura is still listed as a member of the board).

Geocast competitor iBlast is said to be recruiting heavily among orphaned Geocasters--as is WebTV inventor and former CEO Steve Perlman, who is looking to bolster his stealth start-up Rearden Steel Technologies. But recruiters are running into some resistance as certain members of Geocast's talented engineering team are banding together to possibly strike out on their own.

Which brings us to another unpleasant rumor churning through the mill these days--is E-Stamp going out of business? That's the word on the street, and E-Stamp is not quick to deny it.

"We're exploring a number of options to maximize shareholder value," an E-Stamp representative responded.

The company, which in November gave up on electronic postage to focus on shipping and logistics products, last week reported a loss smaller than last year's--and laid off 45 people.

But--cry E-Stamp partisans--it can't go out of business now. Then it won't be able to attend its scheduled appearance before the Nasdaq Listing Qualifications Panel--to avoid being delisted for not being in compliance with the exchange's minimum bid price requirement. Every day I'm not delisted is another day I can receive your rumors.