Report: Sticky Networks No More

Conceived, funded and launched inside of one year, StickyNetworks, an e-commerce Application Service

Provider, has now come full circle by reportedly shuttering operations.

In an interview with an email newsletter publication of Red Herring magazine, Sticky Networks’ CEO Robin

Johnson confirmed reports that the start-up had laid off its remaining 30 employees as of last week.

Calls to the company’s officials were not returned by deadline. In an interview with the newsletter, Sticky

Networks’ Johnson said the market wasn’t ready for the company’s offerings.

Built on a model of creating a new way for manufacturers and commerce portals to hold their customers’

interest on a site, Sticky Networks built a Java-based platform that sought to encourage users to source more

information about content already on the sites. The bottom line: retention of customers.

Despite $15 million in backing and a splashy marketing campaign that got the local industry buzzing, the

company’s June launch placed it in an increasingly chilly venture funding environment. With e-commerce plays

losing out on expected rounds of funding, Sticky Networks was faced with a tougher time selling its ASP services

to online clients as well as offline clients pulling back on their Web strategies.

Warburg Pincus Equity Partners led the $15 million the company received earlier this year, followed by Acon

Ventures, an affiliate of Texas Pacific Group and the New York City Investment Fund. Existing shareholders were

Primedia Ventures, Inc. and the Readers Digest Association.

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