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February 21, 1999


By CBR Staff Writer

Shares in two internet software companies began trading healthily on the Nasdaq-Amex exchange Friday, seemingly oblivious to the recent downturn in internet stocks. WebTrends Corp, a supplier of web traffic analysis and reporting software has gone public through an initial offering of 3.5 million shares, 3.0 million of them new, at $13.00 each, raising $39.0m for the company before expenses. And Vignette Corp, the Austin, Texas-based company that produces web content application development tools, sold 4.0 million shares, 3.68 million of them new, at $19 per share, raising $69.9m before expenses. Both firms enjoyed hugely successful first day’s trading, with Vignette finishing higher in absolute and percentage terms, although it started at a higher price. Vignette opened the day at $41, rose to a high of $52, before closing up $23.6875, or 124.7% at $42.6875. WebTrends opened at $36.50 hit $38 and then closed the day at $27.0625, a rise of $14.0625, or 108.2% on the offer price. Portland, Oregon-based WebTrends raised the price and size of the offering earlier last week by 500,000 shares and to $13- $14 from $11-$12. Vignette’s market capitalization at the opening bell on Friday was $1.07bn – 67 times the company’s revenues for 1998. Vignette increased revenues from $7.4m to $26.1m last year, though losses climbed from $7.4m to $26.1m. The frenzy around Vignette has been created by its involvement in the current sector of choice, enabling companies to develop and manage online customer relationships. With the boom predicted for e-commerce, the market clearly believes Vignette has a massive future. Its StoryServer application platform enables companies to engage web site visitors with personalized interactions that are designed to stimulate buying and strengthen customer loyalty. The package offers decision support capabilities to analyze customer preferences, analyze where they live and determine the popularity of individual products and services. Vignette is about to ship its Syndication Server platform, which is designed to enable a companies to distribute electronic goods and services outside of its own web site through a network of reseller, affiliate, and partner web sites. Vignette reckons it has little direct competition at present though the very success of its IPO will have big players looking closely at the potential of the market.

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