Intermix On the Radar

MySpace's success came quickly and almost by accident. In 2003, small independent rock bands began setting up pages for fans. MySpace helped them out by letting them stream or download their songs, post tour schedules, set up blogs and communicate directly with fans. More than 100,000 bands now use MySpace, and millions of fans have signed up as well. Unique users surged to 5.8 million in December from 214,000 a year ago. The site is ranked the 14th most visited by Hitwise, which tracks the traffic of 25 million Internet users -- putting MySpace ahead of Amazon.com (AMZN Quote).

MySpace wasted no time in mining the site for ad dollars, which make up 90% of its revenue. It integrated the brand of a P&G deodorant, Secret Sparkle, throughout a page set up for teen singer Hilary Duff. It worked with Fox to set up a site for its hit show, The OC. And it prereleased streaming samples of REM's most recent album, Around the Sun.

Rosenblatt won't break out revenue for MySpace.com, but ThinkEquity analyst John Tinker, the sole analyst covering the stock (his firm has no underwriting relationship with Intermix), estimates it at $9 million for the fiscal year ending in March. Intermix turned MySpace into an independent unit in December, when Redpoint Ventures bought a $4 million stake in Intermix and announced that Geoff Yang, a VC behind AskJeeves and TiVo , would join MySpace's board. Rosenblatt says Intermix plans to split MySpace off through an IPO within 12 months.

Four-Point Swing

Intermix also applied social networking to Grab.com, allowing gamers to invite in friends -- or friends of friends -- to play, to create tournaments and to chat with each other while playing. Before, gamers usually played games alone on the site. Since the change, visitors spend an average of 69 minutes on the site, three times longer than when they were playing games by themselves. Launched in October, Grab.com's traffic had already risen to 1.1 million unique visitors in December.