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Unfortunately, the mother lode of dot-com gold has about dried up, and the vultures are circling Exodus. The Chapter 11 filing is just the latest bead in a string of bad karma: Its stock price sunk beneath "all-time-low" levels months ago, and the obligatory class-action lawsuits have been brought by shareholders. Customers are going bankrupt, cash reserves are dwindling fast, and analysts are making dire predictions about the company's ability to dig out from under a mountain of debt and turn a profit. To top off the bad news, Ellen Hancock, CEO of Exodus, abruptly resigned in September. Analysts can't agree whether it was a palace coup or a case of the captain abandoning the sinking ship. Welcome to business as usual in the A.D. (After Dot-com) era.

Before the bankruptcy filing, Hancock's departure and her replacement L. William Krause stepped in, we sat down and interviewed her as well as Exodus' president of worldwide sales, Sam Mohamed, on the future of the company. The difficulty we had scheduling time with Hancock seems indicative of the burden she faced before leaving. With the company's market base turning from bedrock to quicksand, the pressure was on for Exodus to find some solid financial footing. When we asked some questions, Hancock's hint of a nasal New Yorker's inflection betrayed a certain weariness -- illustrated by the smooth, well-practiced but rote way she answered. That's understandable. She'd heard it asked a lot of different ways, but the $64,000 question remains: You sold Web sites to dot-coms, and now the dot-coms are dead. How are you going to be in business a year from now?

Hancock never quite delivered a compelling answer -- which might explain why she doesn't work at Exodus anymore, and why it’s in Chapter 11. As Hancock drolly said, we -- meaning everyone in the industry -- might have somewhat overestimated the Internet demand. Mohamed agreed, saying, "All of us planned on continuous growth. It didn't quite pan out as hoped."

First Steps

In 1990, K.B. Chandrasekhar came to the United States armed with a master's degree in electrical engineering and physics. He also had the insight to realize that the Internet would be a key element of business in the years ahead. After starting a tiny software consulting company, Chandrasekhar founded Exodus in 1994. In those heady early years, he realized that not every company had the resources, expertise or inclination to start a Web site. So in 1996, Exodus launched its first dedicated data center, supplying Web sites to such companies.

By 1997, the company was focused on co-location services for dot-coms. Beginning in 1998, Mohamed says, Exodus started to see big, mainstream companies looking at the Internet as a way to talk to their customers. This is when Exodus' clients started demanding more services, such as network management, database administration and backups. It was also in March 1998 that Exodus recruited Ellen Hancock as its president and had the obligatory spectacular IPO. By September, Hancock was promoted to CEO while Chandrasekhar ascended to the board of directors and eventually left to pursue new ideas.

Now that the slowdown has hit, officials are quick to liken Exodus to the quick-moving hare, not the sluggish tortoise, using adjectives like "fast" and "nimble" to describe their company's advantages over the competition. We agree that, because it owns the physical components of its business -- the network and data centers -- and because it has a fairly expert staff, Exodus does have considerable flexibility to adapt to tough times and, failing that, has an tempting dowry to bring to an acquisition.

In addition, Exodus has been smart in the partnerships it has forged. Just last month it announced a pact with Veritas Software Corp. to offer Veritas' storage products. And in May it teamed with Counterpane Internet Security to offer a managed security monitoring service. Telseon, Volera and Yipes Communications are also on board. In addition, Exodus is part of the Content Bridge alliance, which is seeking to advance the cause of content distribution services.

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Now is the time of "mainstream maturity," says Mohamed, where enterprises are looking for complete outsourcing of Web sites as well as associated applications services.

Hancock described it as a question of ascertaining what is "core" to your business and what is "context." For most, the Internet is just the context in which you operate -- a company needs to focus on its core. "You outsource what's context," said Hancock. This dovetails with Network Computing's view of outsourcing: IT needs to focus on the core business first. If outsourcing enables that, it's worth considering.

Mohamed describes Exodus' philosophy this way: "We took a server approach, not a 'surfer' approach. We overbuilt capacity, with massive headroom." This is in contrast to an ISP or telco approach. "The telco perspective is to oversubscribe, since surfers aren't always online," he says.

When we ask about Exodus' technology edge, we hear again about flexibility and speed, and Mohamed extols the customizability of the company's applications. "Hosting companies tend to force-fit customers into platforms," he says. "We custom-fit solutions."

Exodus needs to extol its virtues as loudly as it can -- head-to-head competition with formidable telcos has brought better companies than Exodus to their knees. While telcos might be larger players, with more resources, they're not as focused as Exodus; at least, that's what Exodus says. Hancock pushed the idea that telco competitors may be larger, but Exodus has a laser focus on the Web-hosting space and its associated services. Essentially, what is compelling is the one-stop shopping -- if you need it, Exodus likely has it. Today, Exodus maintains 44 data centers worldwide. These mission-control installations are intended as oases for the 24/7 Internet world, designed to withstand natural disasters of all kinds.