alarm:clock

Search - Friday, January 11, 2008

Infospace Founder Files IPO For Intelius

Naveen Jain is a witch. The Seattle-based entrepreneur is able to defy skeptics time and again. After having worked at Microsoft Jain founded Infospace and made a small fortune when he took that company public. Jain was later embroiled in a scandal at Infospace but was able to escape that relatively unscathed - save for his reputation and fines.

Now Jain has filed to take his latest startup - Intelius - public. Intelius offers a paid online directory whereby users can get background checks on potential employees, a baby-sitter or someone they're dating. It has recently made the Inc. 500 list and has seen its revenue more than triple in the past three years. Intelius says it did $60.2M in revenue for the first nine months of 2007, moreover, it has been profitable with net income of $6.1M during this period.

The Seattle PI draws attention to a couple of problems that Intelius might face. Firstly, Wall Street might not like it that Jain is CEO given the bad taste left by Infospace. To that Jain might say tough. Intelius didn't raise much from outsiders and the other top managers came from Infospace and are Jain loyalists. Who is going to ask Jain to step aside for the best interests of the company?

Secondly, there has been and may continue to be a ruckus over privacy infringements by Intelius and the company states this risk in its filing.

One observer with a keen eye notes that Naveen Jain put $3-4M per year in Intelius marketing expenses on his personal credit card. That should get him a few free mile rewards.

(Full disclosure - Naveen Jain was an angel investor in the original alarm:clock - a print magazine - although he is not a current stake-holder in this venture.)

View - site
Read - SEC filing