By KAISER KUO | CHENGDU
Posted Sunday, June 29, 2003; 14.08BST
Charles Zhang is not afraid of heights. Last month Zhang, the 39-year-old founder of Chinese Internet portal Sohu .com, was clinging to the face of Mount Everest, 6,666 m above sea level. That's high, but it's nothing compared to the altitude of his company's stock price. On June 25, Sohu shares stood at $26.24 on NASDAQ — a gain of almost 200% since April 1.
More impressive, Sohu shares are worth 36 times their value during the dark days of the Internet bust. Sohu, which started in 1996 as the first Chinese-language search engine, surprised critics by turning profitable in the third quarter of last year. Revenues ($28.7 million in 2002) continue to grow at double-digit rates. But the climb has not always been smooth; during the shakeout that followed the dotcom crash, Zhang's shareholders questioned the company's heavy dependence on banner-ad revenue. Hostile board members and disgruntled investors wanted professional management to replace him. Zhang says his nonconfrontational style — what he calls "playing Tai Chi" — helped him hold on, but the experience "was the worst sort of psychological torture."
Short-messaging service (SMS) helped the company turn around. SMS generated total revenues of $750 million in China last year, and now accounts for 48% of Sohu's revenues. Zhang, who holds a Ph.D. in physics from M.I.T., found Everest all too familiar. "The temperature was sub-zero, with winds threatening to blow my tent over, and I was constantly out of breath. But as bad as it was, I'd sooner do it all again than repeat what I went through after the bubble burst." Is he out to climb more mountains? Undoubtedly; he's not afraid of heights.
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