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On The House

Sometimes, the best way to make millions is to provide something free of charge.

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This story appears in the June 2000 issue of Entrepreneur. Subscribe »

Justin Kitch has raised millions of dollars by giving things away. Homestead.com Inc., the 120-person Menlo Park, California, business he co-founded in 1997, provides free Web sites for the asking. Anyone who wishes can get 16MB of free disk space on the company's Web servers, along with the use of free site design tools that rival costly commercial versions.

Huge numbers of people have signed up to create their own "homesteads" on the Web for free. "Last year, we started with 100,000 homesteads and ended up with four million," says Kitch, 27. "And we're currently growing at more than 15,000 new sites per day." Granted, it's not too surprising that customers like Homestead's offer. But how do you explain the more than $50 million Homestead has raised from investors over the past two years?

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