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IExchange.com Says It Laid Off 15 Workers

May 31, 2000|Walter Hamilton

In the latest example of a "dot-com" company undergoing cutbacks, IExchange.com, a Pasadena-based company that runs a stock-picking Web site, has laid off about one-third of its work force.

The company said Tuesday that it terminated 15 of its 46 employees May 19 in a bid to preserve cash at a time when the financing spigot has all but closed for dot-coms.

The privately held company also said that David Eisner, IExchange.com's co-founder, has relinquished his role as chief executive to become vice chairman. That change had long been planned, the firm said.

IExchange.com runs a Web site (http://www.iexchange.com) that allows anyone to become an "analyst" and write reports recommending individual stocks. IExchange.com then tracks the performance of the pickers and their stocks.

The amateur analysts charge small fees to other individuals for access to their reports. IExchange.com gets a portion of the revenue from each sale.

The problem, Eisner said, is that though many people have perused the site, not as many have purchased reports as had been anticipated.

"The revenue model had been a little slower to pick up than we had expected," he said.

IExchange.com has garnered financing from top venture-capital firms, including Idealab, Kleiner Perkins Caufield & Byers and Capital Z Partners.

IExchange.com has almost $35 million in cash and won't need additional funding for 18 to 24 more months, said Heath Schiesser, acting chief executive.

A number of dot-coms have announced layoffs recently, as investors have soured on the prospects for unprofitable Net firms. Faced with the inability to raise additional funding, many dot-com companies are seeking to preserve cash.

IExchange.com is taking several steps to boost sales of its analysts' reports, including redesigning the site and adjusting pricing, Schiesser said. The company also is considering joint ventures or other collaborations with other firms.

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