Digital Planet once tapped the inside of Madeleleine's Mind; now it wants to tap individual investors. The Southern California-based Web creative shop plans to file for an initial public offering soon, using the services of Direct IPO.
"This is really a very appropriate mechanism for the early adopter on the Net to invest in a company they understand," says Direct IPO chairman Michael Terpin about the planned offering.
Terpin and Direct IPO president Mark Perlmutter believe the upcoming Digital Planet stock sale and others like it will give the small investor an opportunity to back a company at a second financing stage - previously available, for the most part, only to venture capital firms like Kleiner Perkins Caufield Byers and Hummer Winblad Partners.
The self-underwritten offering by Digital Planet will take place under the SEC's Regulation A, which covers companies selling up to US$5 million in shares. Details on the filing, including the number of shares to be sold and the exact offer price, are expected to be available on the Direct IPO Web site in 45-60 days, after the SEC declares it to be effective.
Terpin and Perlmutter say there's a big difference between Digital Planet's plans and previous efforts to procure Net-based public financing by firms like New York's Spring Street Brewing Company and its owner, Andrew Klein.
"We don't want to make any enemies," Terpin says. "Andy Klein was out there saying he wanted to bring Nasdaq to its knees. We want to help these companies to get to Nasdaq."
