Actua Corporation

» see actuacorp.com as it lived, on the wayback machine

~ the obituary ~

I was fifteen in 1999, on a 56k modem in Ankara, and the NASDAQ was not a thing that reached me. Internet Capital Group reached almost nobody as a product, because it did not have one. It was a holding company in Radnor, Pennsylvania, and for a short stretch at the end of 1999 the market said it was worth more than fifty billion dollars.

Ken Fox and Buck Buckley founded it on 4 March 1996. Both came out of Safeguard Scientifics, Fox running West Coast operations and Buckley as a vice president of acquisitions, and they brought the house model with them. Safeguard called it a keiretsu, borrowing the Japanese word for a network of companies bound together by cross-holdings. ICG would take positions in business-to-business e-commerce startups, involve itself heavily in how they were run, and arrange for the startups to do business with each other.

Put plainly, it owned pieces of a lot of young companies and encouraged them to be each other's customers. In a rising market that looks like a strategy. In a falling one it means your portfolio's revenue and your portfolio's spending are the same money going in a circle.

~ the case file ~

~ the best IPO of the year ~

ICG went public in August 1999, offering 14.9 million shares at 12 dollars, and the price doubled on the first day. IBM took 3.75 million shares at the offer price and Dell took a million. By the end of that first month the stock was at 58. By December 1999 it was trading above 200.

That is a gain of 2,733 percent, and it made ICG the best performing initial public offering of 1999, in a year with a great deal of competition for the title. The company's own article gives the peak valuation two ways, over fifty billion in one place and nearly sixty billion in another, and the gap between those numbers is itself a fair description of how carefully anybody was counting at the time.

~ fifty one cents ~

The collapse is best read as a list of prices. February 2000, down 41 percent. April 2000, 35 dollars. October 2000, nine dollars. October 2001, in the weeks after the September 11 attacks, 51 cents a share. Two years after the peak the whole company was worth 200 million dollars, down 99.5 percent.

Most of the dot-com graves on this site belong to companies that sold something to someone, too cheaply or too early. Webvan delivered groceries and Kozmo biked videotapes across Manhattan, and both of them had a real operation underneath the valuation, however badly it was losing money. ICG's business was owning the others, and when the others stopped being worth anything there was nothing left to shrink back down to.

~ the slow sale ~

What makes this one unusual is how long it took to die and how competently it died. The company did not file for bankruptcy. It spent most of two decades selling what it owned, and the prices got better rather than worse.

In February 2013 it sold its stake in Channel Intelligence to Google for 60 million dollars. In December 2013, Procurian went to Accenture for 375 million. In September 2014 it renamed itself Actua Corporation, with the stock around 20 dollars and the business worth roughly 700 million. GovDelivery went to Vista Equity Partners in October 2016 for 153 million. Its interests in VelocityEHS and Bolt Solutions went in December 2017 for 328 million, and FolioDynamix followed on 2 January 2018 for net proceeds of 166.3 million.

Once the last business was sold there was nothing left to be a holding company of. Actua filed an 8-K on 18 April 2018 and underwent liquidation. The dot-com crash is usually told as a set of sudden deaths in 2000 and 2001, and this one simply refused to be sudden: the company that lost 99.5 percent of its value in twenty four months then took another sixteen years to put itself away, and actuacorp.com today serves a 195-byte error page telling you to contact your service provider.

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