Netscape Ipo - 3013 Words

It all started with the development of a graphical software program that gave rise to the notion of surfing (Netscape s). Netscape Communications can trace its roots to a group of science students working at the University of Illinois at Urbana-Champaign who turned a simply software program called Mosaic , into a platform that enabled non-technical computer users to access and retrieve information that was becoming more and more available on the worldwide web. Founded in 1994, Netscape Communications Corporation provides a comprehensive line of client, server and integrated applications software for communications and commerce on the Internet and private Internet Protocol (IP) networks (Netscape s). A key feature that the company†¦show more content†¦The optimal capital structure minimizes the firm s composite cost of capital and saves money for other opportunities. Therefore, the mandatory use of optimal capital structure and risk management is becoming increasingly import ant. Netscape s operating result in 1995 had showed the Current ration (1.45) was low, the Debt to total capital ration (0.18) was high, which compared with its competitors: Microsoft (4.17, 0.00), AOL (1.00, 0.08), and Spyglass (13.75, 0.00). More long-term debt would decrease the Current ration, and increase the Debt ration. Additionally, of Netscape s competitors were now operating as publicly held companies. Netscape had been injected with various forms of investment capital, which included private equity investors. Continuing the same method to fund capital will further dilute Netscape s ownership. Although, Netscape had a net loss of over $4 million on total assets over $42 million, and had never declared a profit in its short operating history, there must certainly be characterized as a risky IPO. However, based on the research of Wall Street and the positive results of Netscape s road show, Netscape s underwriters had the confidence that the market demands would be enormously high, and would continual to grow. According to all of the factors we have mentioned above, by balancing the intense competitions, the business risks, the high market demand, and the costs involved, we feel confident that Netscape would gain moreShow MoreRelatedNetscape Ipo2102 Words   |  9 Pages------------------------------------------------- Top of Form Netscape IPO Introduction The case analyzes the Initial Public Offering (IPO) of Netscape Communications Inc., in order to recommend a justifiable share price for the IPO. Founded in April 1994, Netscape Communications Corporation provided a comprehensive line of client, server and integrated applications software for communications and commerce on the Internet and private Internet Protocol networks. The primary revenue generator for Netscape at the time IPO was it s InternetRead MoreNetscape IPO Case Study1362 Words   |  6 Pagesï » ¿Case Study 2: Netscape’s IPO February 17, 2015 Executive Summary Netscape was founded in 1994 and it provided internet applications for communications and commerce. In 1995, Netscape decided to raise capital by initial public offering. Although initial price for shares was at first $14, underwriters suggested increase the price to $28 one day prior to the initial public offering. The board of Netscape was not sure of the high price and fell in dilemma because the firmRead MoreKey Facts Of Netscape Communication Corporation1889 Words   |  8 PagesSummary of Key Facts Netscape Communication Corporation was founded in April 1994. â€Å"The company provided a comprehensive line of client, server and integrated applications software for communications and commerce on the Internet and private Internet Protocol networks† (P1) Netscape developed a popular product which offers a variety of internet functions at 1994. The product was outstanding back to that era, and it was successfully taking large amount of market share for the company. Since the marketRead MoreNetscapes Initial Public Offering Case1565 Words   |  7 Pagesstrategy: * Firstly, Netscape with its strategy â€Å"give away today and make money tomorrow† offered people the free access to its software in order to build a customer base as well as the foundation of entering the Internet market. * After paying Spyglass a one-time fee for the original Mosaic code, Netscape made its own and new brand to occupy a position in the new field. * To set a new standard, Netscape created a rival program (named Mozilla and then changed to Netscape Navigator) to destroyRead MoreNetscape Case Memo1377 Words   |  6 Pages1. Why are investors excited about Netscape? What is Netscape’s business model? What must Netscape accomplish if it is going to be successful in the long run? What are the risks Netscape faces? Marc Andreessen, along with the other founders of Mosaic, accomplished what other Internet providers before failed to do: they created a Web browser that did not require the user to have expertise in HTML coding. Mosaic’s user-friendly click-and-point interface allowed for a wider customer base. After purchasingRead MoreNetscape Case Study1193 Words   |  5 PagesCorporate Finance: Case Netscape 1. Why has Netscape been so successful to date? What is its strategy? How risky is its current competitive situation? Netscape follows a â€Å"give away today make money tomorrow†-strategy. Netscape currently has 75% of web browser market, making it by far the most popular browsing software. Netscape is making money by selling server software to companies that require marketing access to potential consumers, by selling its software packages and through providingRead MoreShould Netscape Go Public to Satisfy Capital Needs1063 Words   |  5 PagesShould Netscape go public to satisfy its capital needs? Netscape does need to go public to satisfy its capital needs over the next three to five years. Netscape is in a position to capitalize on the consolidation of the technology sector. Further, they need to remain competitive against Micorsofts Internet Explorer. By taking the company public, Netscape will also be able to raise capital to expand its business, finance acquisitions, pay debt and have greater access to capital in the future Read MoreNetscape Case Study1036 Words   |  5 PagesThis case is about Netscape Initial Public Offering (IPO) in 1995. Netscape had a successful starting in the market mainly because of their strategy of â€Å"Give away today and make money tomorrow†, which let them capture 75% of the web browser market, making it the most popular browsing software. The successful strategy consists in gaining its large market share by initially giving away its product for free. Netscape had to create a new industry standard to succeed in the long term, beside s make revenuesRead MoreNew Opportunities For Young Software Companies1527 Words   |  7 PagesIntroduction: When Netscape was founded, the Internet market was facing a dynamic evolution, creating new opportunities for young software companies like Netscape to grow rapidly. Netscape took advantage of these conditions, becoming the first to focus on one-web browsers. There was little competition in this space at the time. They became the market leader, commanding strong customer loyalty and high brand recognition. Netscape introduced a competitive line of products, which were innovative andRead Morenestel harward case study Essay4354 Words   |  18 PagesHarvard Business School 9-296-088 Rev. May 16, 1997 DO Netscapes Initial Public Offering NO August 8, 1995 had taken an unexpected turn for Netscape Communications Corporation’s board of directors. Earlier that morning, the day before the company’s scheduled initial public offering (IPO), Netscape’s lead underwriters proposed to the board a 100% increase in the original offering price from $14 to $28 per share. This recommendation came in response to the remarkable oversubscription