The company was spun off in 1999 from Encyclopædia Britannica Inc., which owns the Encyclopædia Britannica, to develop the Britannica as an online resource. Both companies are owned by Jacqui Safra under a holding company. The initial strategy was to give content away free, and for the website to act as a portal (dubbed eBLAST) that would aggregate content from the Internet.

Its original CEO was Don Yannias, a longtime associate of Jacqui Safra; however, Yannias' tenure was marked by poor planning and management. For example, on the first day that the Britannica was made available online in October 1999, the servers crashed due to overly high traffic. Initially, the encyclopedia was made available free online (at a time when the print version cost roughly $1250); however, this changed in early 2001. Despite an enormous ad campaign, profitability was elusive. In November 2000, 16% of its workforce had to be cut, along with its chief financial officer, Jim Hurley, and its editor at large, Bob McHenry; in March 2001, 68% of its U.S. workforce was cut. In May 2001, Yannias was replaced by Ilan Yeshua, who became CEO both of and of Encyclopædia Britannica Inc.