ANOTHER PAIR OF WEB SHUTDOWNS
Byline: Peter Braunstein
NEW YORK — As the dot-com shakeout continues, two more Web players have given up the game: Kibu.com, which had targeted teenage girls, and product-review site Productopia.com.
For Kibu’s 65 employees, the news came on Tuesday, while the approximately 60 Productopia employees learned the news Monday. One former Productopia employee said the company’s staff had left without health benefits, severance, or vacation pay.
These latest dot-bombs will add to the more than 4,500 people who have been let go by Internet companies since June, as measured by employment outsourcer Challenger, Gray and Christmas Inc.
The newest shutdowns also show that not all Internet companies collapse because of burn rates or a dearth of investors. Kibu, launched in mid-1999, raised $22 million in venture funding this past February, and counted among its investors such Silicon Valley presences as industry veteran Jim Clark, former Excite@Home chairman Tom Jermoluk, and the high profile, venture capital firm Kleiner Perkins Caulfield & Byers.
As opposed to many of the more profligate Web sites, Kibu had “a considerable amount of cash left,” according to one investor.
The teen market online has been getting tougher to compete in with the emergence of Web sites such as iTurf, Snowball, Alloy Online, and Bolt.com. Internet consultant Jupiter Communications estimates that 47 percent of teens use the Net.
San Francisco-based Productopia’s downfall followed the same general contours. Launched in June 1999, the Web site used both in-house and nationally recognized experts to provide product information in 450 categories, including women’s apparel, beauty, men’s wear, home goods, toys, sports, and baby products. The site offered recommendations as well as information about online and offline stores where items could be purchased. In January, Productopia received $22 million in financing from investors including former Compaq computer chairman Ben Rosen, former Barnesandnoble.com chief executive Jonathan Bulkeley, CMGI@Ventures, RRE Ventures and Bessemer Venture Partners.
In June, Productopia laid off most of its production staff. Upon closing up shop on Monday, company executives were telling contractors to cash their checks quickly, according to one source. Productopia’s fall reflects a general trend in the Net’s ailing product review sector; last month, Deja.com laid off more than a third of its staff.