End of the world for theglobe

theglobe.com is shutting down its main website

One of the first darlings of the tech stock boom is to close its doors.

Theglobe.com - which offered a community and hosting service for the web pages of its members - has said it will be closing its original website on 15 August 2001.

"The market downturn over the last year has made it increasingly difficult to cover the costs of operating theglobe.com's website and services", the company said in a statement.

Theglobe.com has cut 60 staff, half the total workforce, and is looking to sell off its remaining games website businesses.

The move marks a complete turnaround in fortunes for a company that was seen as the blueprint for internet flotations during the tech boom.

Trailblazer

When theglobe.com floated on Nasdaq in November 1998 it set a record for the biggest first-day price leap in history, clocking up a six-fold increase on its opening value.

The flotation made the company's founders - twentysomethings Stephan Paternot and Todd Krizelman - into internet trailblazers and paved the way for the boom in tech stocks.

Following the success of theglobe's flotation, many other internet companies rushed to the market.

Investment banks were only too willing to help them float, and for a while it looked as though internet firms could do no wrong as the price of technology shares went through the roof.

Globe stops spinning

Despite theglobe.com's storming start the website struggled to make money and its share price fell back until, in April 2001, it was delisted from Nasdaq after its shares fell below $1.

Now the company is moving out of its New York headquarters to a smaller building.

It had diversified into online games through websites such as Happy Puppy and Kids Domain, which it now hopes either to sell or combine with another business.

To add to theglobe.com's woes, investors have filed a lawsuit against the company alleging that they were misled about its financial position.