In late 2000 and early 2001, however, financial resources once again became the primary
constraint. Wall Street, in a shockingly rapid change in perspective, started evaluating dotcoms based
more on profitability than on revenue growth. Anticipating the pressures this would create, Mr.
Nisenholtz initiated conversations with the Company about the possibility of layoffs. Subsequently,
the Company made a series of incremental cuts to NYTD’s budgets. Two painful rounds of layoffs
followed in January and in April. As a result, many existing features that were not drawing
significant user attention were discontinued.