theGlobe.com: A 606% IPO Pop, Plastic Pants and a Zombie Stock Ticker

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theGlobe.com began in 1994 when Cornell University undergraduates Stephan Paternot and Todd Krizelman became fascinated by a chat room on the school's network. Over Christmas break they raised $15,000, bought an Apple internet server and started a programming company called Web Genesis, then launched theGlobe.com on April 1, 1995. The site drew more than 44,000 visits in its first month as users built personal homepages and joined forums, and by its first anniversary it had 17 staff. In 1997 it raised $20 million from Dancing Bear Investments, and on November 13, 1998 it listed on Nasdaq as TGLO. Priced at $9, the stock opened at $87, peaked at $97 and closed at $63.50, a 606 percent first-day gain that was then the largest in IPO history.

In 1999 CNN aired footage of Paternot in shiny vinyl pants at a Manhattan nightclub declaring himself ready for a disgusting, frivolous life, and the press dubbed him the CEO in the plastic pants. As the bubble burst the stock fell below 10 cents, the founders were forced out, half the staff was cut and the original community site was shut down. Under a CEO who had been a vice president of the American Institute of Certified Public Accountants, the company tried an internet phone service, print magazines and spam sent to MySpace users, and lost a California anti-spam case. By 2011 it reported about $6,000 in assets against $3.2 million in liabilities, yet the ticker kept trading as a shell, and in 2017 liquefied natural gas exporter Delfin Midstream bought nearly 71 percent of the shares.

• Each founder received a $500,000 payout from selling preferred shares in 1997, on top of salaries over $100,000.
• IPO cash went into gaming websites and print titles including Computer Games Magazine, later joined by Now Playing and MMO Games Magazine.
• Sprint Nextel sued the company for patent infringement over its voice over internet protocol technology.
• Legal estimates put potential liability from the spam suits as high as $120 million, and all magazines and gaming sites closed by March 2007.
• In 2008 it sold Tralliance, operator of the .travel domain registry, while keeping earn-out rights that became its only income.