"You have to look at the Internet sector as a brand new industry with mostly development-stage companies," Alex Cheung told CNBC in April 1999, when he was portfolio manager of the Monument Internet Fund. Although the fund itself invested no more than 25% in emerging Internet companies and Cheung is still not keen on pure-plays, especially those still in the red, he was, at the time, one of the many Internet soothsayers advising investors to throw traditional P/E valuation models out the window in favor of the potential to make money.

Look for a company with a "business model with a clear path to profitability" - "and money in the bank," he said.

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