StarNet Aims High with IPO
Does an IPO from an ISP stand a chance? Well find out in spring 2002, when StarNet goes public in what could wind up as an investor referendum on the future of fixed broadband wireless.
The seven-year-old company provides broadband wireless and wholesale dial-up services in its home base of suburban Chicago, and by the end of this month, it will have launched broadband wireless in Las Vegas. StarNet CEO Russ Intravartolo says Miami, Dallas, Phoenix and Sacramento also could be up and running by the time of the IPO.
Unlike rivals AT&T Wireless and Sprint, which recently shut down or mothballed fixed broadband wireless, StarNet uses technology that doesnt require a license and has far lower infrastructure costs. That means a faster return on investment: Intravartolo says that StarNet starts turning a profit on a customer inside of four months, while rival broadband wireless services usually take at least a year.
Despite its wireless success, StarNets bread and butter will continue to be wired dial-up, where the company has managed to outlast competitors and add enough customers to hit No. 232 on Inc. magazines 2001 list of fastest-growing companies. "Were not trying to monopolize the market," says Intravartolo, a former Motorola exec. "Were very good at sharing."
The IPO will be the first time that StarNet has sought outside investment. Why now? Intravartolo points to a recent pick-up in IPO activity and his companys success thus far. "We expect to be north of $60 million in revenue by the time were positioned for our IPO."