ABSTRACT
The viability of online firms depends on their economic ability to be able to survive as a profitable operation, but also on their organizational capability – seen in terms of their methods of operation, processes, customer relationship management skills, and human resource systems. In order to be able to capitalize on the benefits of its business model, Stepstone had to internationalize its own operations at a very rapid pace whilst also managing the evolution of the e-commerce business model. The latter task was in itself risky. After its 1996 foundation, Stepstone gradually opened operations in five European countries. By 1999 it employed 200 people and had made £7m in revenue and a loss of £15m. Its goal was to become Europe’s leading recruitment and career portal. It embarked on a massive expansion throughout Europe in 2000-2001 that almost led to its collapse. In order to fund this expansion Stepstone floated the company at the Oslo and London stock exchange at the height of the Internet boom in March 2000 when it was valued at £530m. The floatation was twenty times oversubscribed and initial enthusiasm doubled the share price, valuing the company at more than £1 billion. Stepstone already had a strong position in the UK market and beyond that in Europe but in order to become the leading recruitment and career portal in Europe it had to grow rapidly.
