Byline: Katherine Bowers

LOS ANGELES — Venture-capital funding is evaporating like water in the desert, leaving start-ups that had promising beginnings high and dry.

Online business-to-business research firm Competitive Knowledge Inc., which shuttered its doors Dec. 15, was one such casualty. The company, which had counted Ann Taylor and Bebe Stores Inc. among its clients, cited unfavorable economic conditions and a “lack of funding opportunities” in a goodbye e-mail obtained by WWD.

“Our board of directors has been forced to direct management to proceed with immediate termination of operations. Each of you played a significant role in our short-lived success. We sincerely thank you,” read an e-mail from Gary Narin, president of CKI’s apparel division.

The year-old company had proposed to anonymously aggregate competitive data, such as sales per square foot, inventory turn time and accounts receivable, to provide industry benchmarks for retailers and manufacturers. Those standards would then be made available to subscribers on customized, secure Web sites.

According to Narin, the start-up was on the cusp of announcing several partnerships with e-marketplace providers, such as New York-based The Thread.

“We had projected [that the company would] reach a critical mass of 250 members in 2001,” Narin said in an interview. “It was never in our projections to reach profitability in the first year, but the market is demanding that.”

Despite approaching more than 100 potential sources of capital, Narin said, the company could not secure funding to augment the $3 million it initially raised.

It seemed likely — given that retailers and manufacturers are notoriously tight-lipped about sharing competitive data — that the company would have been stymied by market resistance. That wasn’t the case, Narin said.

“That’s probably the most frustrating thing — we had great market acceptance,” he said.

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