Excite (by then, Excite@Home) filed for bankruptcy on September 28, 2001. But let's not start there, let's start with 1999, when Excite was second only to Yahoo as a pure web portal. Management calculated that they could distinguish themselves by owning their own broadband pipes, and thereby surpass Yahoo and maybe even AOL in a few years.
In a $6.7 billion deal, Excite merged with @home, the leading provider of cable internet services. They established contracts with large cable companies making Excite the 'broadband portal' for most Americans with cable modems in 2000 and 2001.
However, things were turning ugly, as cash coming in from advertising contracts did not equal cash flowing out to employees and vendors. The company spent much of 2001 attempting to raise cash, selling divisions, selling convertible bonds (they raised $100 million from Promethean Capital this way), and closing unprofitable units. Unfortunately, they could not cut costs quickly enough to match the dropoff in advertising dollars. Even after firing half the staff, they were stuck with leases on the buildings those people had worked from.
From 2000q2 to 2001q2, ad revenue dropped more than 60%. Lots of people were signing up for broadband, but the @home side of the business was too small to cover for the hemorrhaging Excite portal. The company needed to get cash from the outside, and they paid for it. Promethean Capital demanded immediate repayment on the convertible bonds only a few months after buying them, claiming that Excite@Home had substantially misrepresented the state of their business.
During the firesale, they sold Blue Mountain Arts, their online gift card unit, for $35 million to Gibson Greetings. Keep in mind that they had paid $780 million for BMA in late 1999.
The fortunes of the company were closely tied to AT&T, and they acted as AT&T's broadband internet provider. This allowed them to negotiate an $85 million investment from AT&T in June 2001, but that was peanuts compared to the company's burn rate, even after thousands of people had been fired.
In August 2001, they fired their auditors, got a $50 million demand from Promethean, and had both Cox Cable and Comcast drop their service. Bankruptcy came the next month.
If you visit Excite.com today, you will see a website that looks like the old Excite portal, but it is an unrelated service that purchased the URL and logo from Excite@Home after the bankruptcy filing.
Business 2.0, August 28, 2001
USA Today, October 1, 2001
Various company press releases