Digital Entertainment Network: Startup Or Non Starter?

A sex scandal clouds Webcaster DEN's IPO

It has all the makings of a great turn-of-the-millennium Hollywood saga: flamboyant characters, big dollars, giant corporations, and a sizzling Internet concept. With its plans to create the online equivalent of a TV network targeting the mercurial tastes of 18- to 24-year-olds, Digital Entertainment Network Inc. has already raised close to $50 million from the likes of Microsoft, Dell Computer, two Chase Manhattan venture-capital units, and several top executives at Lazard Freres. No less than Ford Motor, Microsoft, and PepsiCo have signed on as charter sponsors. And since filing in September to raise $75 million more through an initial public offering led by Credit Suisse First Boston, the stage has been set for DEN to burst out of the pack of Web wannabes.

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