
All-time greatest failed Internet startup - mg1313
http://www.quora.com/What-is-the-all-time-greatest-failed-Internet-startup
======
lisper
My favorite part (with reference to eToys):

"They ditched a perfectly working MySQL application and migrated to Oracle
which caused them to hire Oracle consultants $2000 per day and spend millions
on Oracle big-iron."

Reminds me of when the ads manager at Google decided we needed to ditch MySQL
and get a "real database" for the ads system. "Real database" in that case
meant Sybase, but it was still a barely mitigated disaster. Sometimes it seems
as if the "real" databases are just a colossal scam.

~~~
dpapathanasiou
Hard to say if the switch to Oracle (and the resulting expenses) was the
reason for their demise, but I was surprised by this:

" _In 2000 they were doing around $24 million per quarter with a gross margin
of 21%._ "

Wow. How could you get off to a start like that and blow it all?

~~~
bpeebles
Well, it never was listed that Oracle was _the_ reason, just that it was one
of, and indicative of why it failed. If the MySQL solution was working, which
the answerer on Quora implied, and there was no immediate sign of its failure,
I think transitioning to Oracle at the cost of millions of dollars is a pretty
big mistake.

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steveb
How about Iridium? Over $5 billion invested, sold for $25 million.

<http://www.wired.com/techbiz/media/news/2000/03/35043>

Right now it is hard to compete with bing.com, losing 2.5 billion per year.

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Eliezer
Oh ye of little history. Do none remember Xanadu still? Inspired by Eric
Drexler's call for hypertext as a way of making society more intelligent, they
tried to invent the Web, a decade too early and with standards much too high
(cached local copies which would still receive micropayments, two-way
backlinks), and never solved the incredibly difficult programming problems
they were tackling before Mosaic and HTML came along.

~~~
neonscribe
Ted Nelson, not Eric Drexler. And not "inspired by" but founded by him. (K.
Eric Drexler is nanotechnology, not hypertext.) Not really an Internet
startup, certainly one of the longest but not the biggest tech business
failures.

~~~
Eliezer
Ted Nelson was the founder, yes. He was inspired by Drexler, who like certain
later transhumanists did human rationality on the side. Do none still remember
"Engines of Creation"? It had a whole chapter on hypertext.

~~~
Turing_Machine
Nelson started what became the Xanadu project in 1960, when Drexler was only
five years old.

~~~
Eliezer
Correction noted. I'm pretty sure though that at least _some_ of the people on
the Xanadu team were Drexler-sent.

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js2
Ah, how do I miss f'dcompany.com. :)

I'm still impressed by the VA Linux IPO:

<http://en.wikipedia.org/wiki/Geeknet>

------
Cherian_Abraham
Anyone remember BroadVision? (shudder!)

For a time there, I worked for UNext, an online University who decided that it
was not enough that their site was powered by Broadvision (using highpriced
broadvision consultants), but that their Intranet needed to run on broadvision
as well. Oh swell!!

On top of that, they decided to contract those consultants straight out of
Broadvision Inc itself, at over $300 an hour.

The CEO drove one of the $100k Mercedes Jeep type SUVs, imported ofcourse.

Not soon after, I left Chicago to go back to the Valley. And they ran out of
money soon after.

------
Hominem
Great to see Kozmo mentioned a few times, I still to this day have quite a few
Kozmo shirts they used to send out for free.

I'd like to add WinStar, they had people going pretty much door to door in
Manhattan selling services, I got a pretty decent free lunch off them.

I'd also nominate GovWorks, not huge in terms of money burned or technical
blunders, but I credit the movie startup.com for really exposing some sheer
ineptitude.

Edit: How could I forget Globix, the colo that had a coffee shop and a gym.

------
ScottBurson
Metricom burned through $600M of Paul Allen's money building out an early
wireless network that hardly anyone used, then folded. I don't know if this is
quite in the "Internet startup" category since it wasn't a Web site, but it
certainly was Internet infrastructure.

------
jonursenbach
Surprised there's no mentions of Cuil.

~~~
anigbrowl
Even their failure was a letdown.

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sradnidge
I guess technically they don't qualify, but surely Microsoft's web properties
have to be right up there. Billions later, they have yet to turn a profit.

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arethuza
boo.com was pretty impressive - $188 million in _six_ months and all lovingly
documented by their co-founder in CEO in a fairly unapologetic book:

[http://www.amazon.com/Boo-Hoo-Dot-com-Concept-
Catastrophe/dp...](http://www.amazon.com/Boo-Hoo-Dot-com-Concept-
Catastrophe/dp/0099418371)

------
pessimizer
Definitely drkoop.com. Its market cap at one point was around 1.3 billion.

[http://www.nytimes.com/2002/07/16/business/technology-
briefi...](http://www.nytimes.com/2002/07/16/business/technology-briefing-e-
commerce-drkoopcom-is-sold-for-186000.html)

------
daniel1980fl2
They ditched a perfectly working MySQL application and migrated to Oracle
which caused them to hire Oracle consultants $2000 per day and spend millions
on Oracle big-iron. They were hiring out of control. They decided to build a
new building to house their new offices because the Ocean Park Blvd offices in
Santa Monica weren't pretty enough. They opened up a London office in
Piccadilly Circus, the most expensive rental area in London. They replicated
their entire USA dev team in the UK for no apparent reason. They started work
on a German operation. They launched a warehouse in Belgium (my baby) to
service Europe. All execs flew first class between Europe and USA. Engineers
were flown around the world as needed. I was even told to expense my groceries
while in Santa Monica for 3 months. Trivial, but the little things add up.

\--- none of above would have happened, had they hired professional managers,
not a bunch of children willing to spend every single dime on anything other
than business itself.

apply that list to any business, including apple, google, microsoft, oracle,
groupon, you name it, the result would be the same disaster as with etoys.

~~~
arethuza
In some .com disasters it was actually the "professional managers" who caused
a lot of the problems as they were the ones who tried to replicate the
infrastructure, pay and perks of the large companies they had worked for
before.

~~~
daniel1980fl2
how can "professional manager" burn so much money without any profits, knowing
that spending this money will not affect the business (positively) -- is
really building your own offices because you seen five premises and dont like
the view from windows will sell more toys online??

~~~
jerf
It was a heady time. Success was so inevitable that you could just function on
the assumption that you were going to succeed, so you better be ready for it.
It was _just about_ to start raining money, the winners would be the ones with
the largest buckets, and you better invest in that bucket! Unfortunately what
actually rained down turned out to be fire from the heavens, but, well, you
know how the story went after that.

