Darren Chervitz of Jacob Asset Management has found some promising investment ideas -- right here on the Internet.
His four-star Jacob Internet Fund is up an average of 18.2 percent per year over the last five years.
Chervitz expects consumer spending to continue to be a drag, offset by international exposure and the weak dollar. He particularly likes small-cap tech stocks with beaten-down valuations, stocks of companies that appear to be likely targets for acquisition.
(See below for CNBC.com-exclusive pick)
He likes TheStreet.com, suggesting that the online market site could be a candidate for acquisition by a large media company looking for an Internet presence.
He also recommends Digital River, which helps companies move their business online. Shares were hurt when the company's largest client, Symantec, renegotiated its contract, but Chervitz expects the effects will have passed by the end of the year.
Chervitz also offered a bonus selection for CNBC.com -- not revealed on TV.
He likes Shutterfly, the leading online photo service. The company does a brisk business in personalized products like scrapbooks, beverage mugs, and calendars. It's expected to fulfill more than eight million orders this year. He also notes there has been some insider buying by management in the last week.
Chervitz owns TheStreet.com and Digital River through his fund.