Saturday, March 12, 2005

The InfoSpace Con

InfoSpace boss

The Seattle Times has an interesting story on the rise and fall of InfoSpace, and how they were able to con people out of billions:


Five years ago this week, at the height of the dot-com stock frenzy, a young Bellevue company called InfoSpace was worth more than Boeing.

Wall Street analysts hailed the startup, which promised to bring the Internet to everyone's cellphone, as "a new Microsoft," and its charismatic leader, Naveen Jain, as a visionary.

Microsoft co-founder Paul Allen had hundreds of millions invested. Small investors such as Bev Hess, a real-estate agent in Phillips, Neb., poured their retirement savings into what appeared to be a sure bet.

At its peak, InfoSpace was the Northwest's biggest Internet business, worth more than $31 billion. Jain, a man obsessed with being more successful than Bill Gates, was himself worth $8 billion. He bought a palatial waterfront home in Medina down the street from his idol and another nearby on Mercer Island, along with two yachts and a piece of the Seattle SuperSonics.


Amazing how someone thinks they can get away with something like this.

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