Gay.com Did Their IPO on the NASDAQ Today
SAN FRANCISCO - There was no big stir on Wall Street, but a San Francisco-based Internet company marked a cultural milestone Thursday by becoming the first gay-directed business to trade its stock on a major exchange.
PlanetOut Inc., which operates several gay and lesbian-themed Web sites, made an initial public stock offering of 4.65 million shares on the Nasdaq Stock Market. The shares gained 16 percent on the first day of trading, closing at $10.40.
In a nod to both its mission and as a statement of gay pride, PlanetOut adopted "LGBT" ? an acronym for lesbian, gay, bisexual and transgender ? as its ticker symbol.
While businesses catering to a gay clientele have appeared on the Australian Stock Exchange and smaller markets, PlanetOut has broken new ground by meeting the requirements for longevity and stability to get listed on Nasdaq, said Walter Schubert, a stock broker who founded Gay Financial Network.
"For years now, we've heard about the gay market and heard about how lucrative it is," said Schubert, who does not own any PlanetOut stock. "Here now is the first publicly traded company where those who are interested in taking advantage of an investment opportunity that's part of that market would find a pretty good opportunity."
In a prospectus filed with the Securities and Exchange Commission (news - web sites), PlanetOut said it hoped to raise $39 million through the IPO, money that would be used to bolster traffic at its Web portals, gay.com and planetout.com, increase the number of subscribers using its fee-based service for personal ads, and expanding into more countries.
The company is also considering using its strong online presence to move into other media, such as print, radio or broadcast.
Unlike many other Internet startups, PlanetOut managed to survive the dot-com collapse by broadening its revenue sources to add subscriptions as well as advertising, by reducing expenses and by adding new features, such as separate travel and shopping sites.
The company posted its first profitable quarter in 2003, but has ended the each of the last three years with a loss. During the first six months of 2004, PlanetOut had a net loss of $416,000 on revenues of $11.6 million, compared to income of $103,000 on revenues of $8.9 million for that period in 2003.
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