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Net Profit

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Net Profit

How to Invest and Compete in the Real World of Internet Business


15 min read
10 take-aways
Text available

What's inside?

Teaching the new dogs (Internet investors) an old trick (fundamental analysis).

Editorial Rating



  • Innovative
  • Applicable


At the peak of the dot-com bubble, buying Internet stocks was momentum investing at its most pure - get in when a new stock or sector is on its upswing, and get out while the gettin’s good. But Peter S. Cohan has created new criteria for Internet investors to apply in the traditional method of fundamental analysis. Instead of looking to old-line gurus like Graham or Buffet for advice, Cohan draws on the business strategies of John D. Rockefeller to come up with fresh e-commerce attributes like economic leverage, closed-loop solutions and adaptive management for investors to measure. getabstract recommends this book to executives, employees and students with equal vigor, although consider yourself forewarned that Cohan’s extended barking-dog analogy will grate on your nerves. Nevertheless, anyone who invests in Internet companies or even traffics in Internet commerce for business or pleasure will gain insights from this book, regardless of whether Cohan’s investment criteria prove to have staying power.


Making Sense of the Internet

How does an investor make sense of the Internet? Asking the question creates an emotional dilemma. On one side is the desire to get a piece of the action; on the other side is the fear that the Internet is a straw house doomed to collapse in the near future. What does an investor do?

You can find the answer to this question in the business strategies of John D. Rockefeller. An Internet investor who reviews Rockefeller’s ownership of Standard Oil can determine that the most successful Web businesses will find the choke points in the Internet economy the same way Rockefeller found the choke points in the oil economy. Track Rockefeller’s reasoning that the oil drilling business had a low barrier to entry which encouraged thousands of companies to prospect for oil, but refining and transportation were choke points in establishing the commodity’s value. Rockefeller turned his awareness into a business strategy by investing in oil refineries and negotiating volume discounts on railroad transportation of oil products. By controlling the movement and refinement of oil, Rockefeller controlled its value.

As an investor, compare John D. Rockefeller...

About the Author

Peter S. Cohan is a technology and business expert who runs his own consulting practice. He is a commentator on CNBC’s Today’s Business and The Money Wheel and is also the author of The Technology Leaders, voted one of the top ten business books of 1997 by Management General. Additionally, Cohan was’s Top Tipper of 1998, based on the leading performance of his CNBC stock picks. He lives in Marlborough, Massachusetts.

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