APBnews.com Exhausts Funding
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APBnews.com, a once-ballyhooed news organization devoted to coverage of crime and justice, said it has fired all of the company's 140 staff and limited its scope of operations.
The news marked the first outright Silicon Alley failure of a Web startup this year.
At a company-wide meeting this morning, the Web site's chairman and chief executive officer Marshall Davidson told employees that the company had exhausted its funding. Although a search is on for additional investors, and possible deals with major media companies, the company is not paying its employees beyond today. Employees are being asked to stay on as volunteers.
APB Online was in the midst of its third round of financing in March when the market's valuation of Internet companies drastically declined, Davidson said in a prepared statement.
The site, which now joins a growing list of failed dot-com plays that are headed for business school case studies, had received splashy coverage of a significant funding round of $20 million only a year ago. BancBoston Robertson Stephens arranged the first $16.5 million of that financing and a second infusion of $3.5 million came through one month later. At the time of the announcement, the company said it would use the proceeds to hire new people, expand its programs and strike more distribution deals.
The company was founded in 1998 and had counted among its staff more than 55 veteran newspaper and television journalists, including two Pulitzer Prize winners, as well as more than 130 freelancers under contract nationwide.