(I can't get no) Satisfaction

This Summer C-Net provided us with the list of the 10 greatest dot-com flops. It's really amazing reading about something that never should be forgotten. How could so much money be invested in so ultimately bad business? And how could senior business people take so dramatically bad decisions? Such as:

- Employing 2,000 and expanding to 26 cities in three years (Webvan)
- Designing content that barerly no one could see on their screeens (Boo.com)
- Paying instead of receiving for every item sold, because of undercharging of shipping costs (Pets.com)

But the greatest riddle of them all is:

How could so many companies get funding when they didn't offer their customers any improvement?  In most cases every venture capitalist could have surfed in on the web site and said: Sorry guys I can't get no satisfaction here.

Or isn't a life most ordinary something for a VC?

Comments

[Billdalsbonden]

I guess we all like to point the finger every know and then and laugh at foolish mistakes we make. That's fine.

But it seems many comments on the dot.com era are becoming increasingly opportunistic and shallow. Why?

Information technology has been a true revolution with an enormous impact on almost everyone on the globe. In one way or the other. Borders have moved and powers have changed. (BTW, I am convinced it will even drive taxes down in Sweden ultimately, that's how powerful it is! Wait and see!)

VC's and start-ups are extremely important 'spieces in the IT eco-system'and if they wouldn't go wrong every now and then they wouldn't be bold enough, they wouldn't aim high enough.

So I say thank God for investors and entrepreneurs who risk their life for stupid ideas.

Those are my kind of guys!

/BB

Here is a link to another guy asking for a more positive view on the dot.com days.

http://expressen.se/index.jsp?a=422996

[Hans Eric Melin]

No, it's not black and white, is it.

But to me it has become a little bit too easy for investors to refer to an one out of ten strategy and feel fine with that. And the reason why nobody stands up and say: "we aim for one out of five" is partly because of lack of knowledge.

You can't create dramatic changes in people's buying behavior in only two years, using very expensive TV commercials as www.letsbuyit.com did. Senior management should know about that.

You shouldn't expand your business to other similar markets if you're not even close to have created a sufficient position in the first market like Webvan did. Experienced people should know about that as well.

These are questions that hasn't anything to do with IT. It's about understanding people. And that's nothing new.

[Billdalsbonden]

The post-bubble-burst debate continues. At http://www.johannorberg.net/?page=displayblog&month=9&year=2005#1273 Johan Norberg debates Björn Elmbrant bubble-critisism book and says being smart is easy - in hindsight! Listen to the mp3 as well.

And obviously some people never learn: I just read in Affärsvärlden yesterday (September 21 issue, not on the web yet) that appliances web shop tretti.se, backed by media VC veteran Jan Friedman, shoots for a quick IPO. And their recipe how to quickly change their prospective customers buying behaviour? Heavy TV-ad bombing!

Hansi, here is the challenge: Pick a stock - any in the world - and we'll match it with tretti.se as they go public. 3, 6 or 12 months later we compare ROI. If you win, I will buy you a beer, if I win I will buy you 5 beers (as you may want to drink and forget, he-he) and I will tell you over and over: senior management should know you just can't do that!

/BB

[Hans Eric Melin]

I could buy stock in Tretti.se (or not). In fact people are buying appliances today. And we are shopping the net. Thus, in this case 15 minutes commercials may be just fine. If the prices differ significantly Jan Friedmann may have a chance which he has showed in his early support of Nettonet. But can the prices really differ that much? If they don't there is not much of a competetive advantage left. And where's the excitement in buying into a business which will basically do the same thing as its competitors only with even lower margins.

Elmbrandt? Let's hope Swedish Radio have better people on board than this guy.

[Billdalsbonden]

Tretti.se - what a challenge! I don't know if you ever picked a stock to race tretti.se. Let us put it like this: it will be hard for you to get those five beers, i.e. to lose the bet. Right now, one day after the listing, the stock is down with 40%. Tretti.se has become arton.se...But I think this has less to do with the business guys of the company and more to do with greedy owvners and bankers. Having said that, my odds to win don't get any better...

[Hans Eric Melin]

Hmm, I don't remember what I have committed myself to... But I certainly agree on that greed and a portion of "fast forward" has generated hard times for a some prosperous new share holders. On the other hand, wasn't it mostly the current owners who put their investment at steak. And asking for the right price, the answer they got.