William N. Melton, foun-der, president, and chief executive officer of Cybercash Inc., has cast a vote of confidence in the company.
Mr. Melton, whose start-up successes included Verifone Inc. in 1981 and Transaction Network Services Inc. in 1991, bought 350,000 shares of Cybercash for $3.5 million 10 days ago. He paid 23% above the market price.
Cybercash, which made its initial public offering in the 1996 Internet- related boom, sells software and services for secure electronic transactions. The share price went as high as $64 but fell back to earth.
The price was $8.09 when Mr. Melton made his purchase, down from a 52- week high of $27.75. The closing price Friday was $8.50, down 10% for the day.
Mr. Melton's move and word that Cybercash had topped 7,000 merchant users helped buttress the stock.
"He made the investment and bought it at a premium because he believes we are on the right track," said James Condon, chief financial officer.
He noted that Rose Glen Capital, Philadelphia, had invested another $15 million in Cybercash in July, completing the third and final tranche of a private placement.
Mr. Condon said Cybercash processes about 140,000 on-line transactions a day, up 150% from the yearend rate. The profitability point is 700,000, Mr. Condon said.
First-half revenue totaled $3.6 million, up 271% from a year earlier. The net loss increased 1%, to $15.6 million.