Czech Startup Ends Its Operations

[Prague, CZECH REPUBLIC], once one of the most promising
Internet startups in the Eastern Europe, is going out of business after
investor’s decision to cut off the financing of the operations. was established in December 1999 as the city-search Web
site for Central and Eastern Europe. Based in Prague, Czech Republic,
with branch offices in Budapest, Hungary, Vienna, Austria and Warsaw,
Poland, it offered coverage of sights, events, contains travel and
accommodation information, reviews of clubs, restaurants and cafis. received substantial funding from the U.S. venture capital fund
Advent International in June 2000. Total amount of US$ 6 million has
been promised.

According to sources close to the company, about one half of this sum
has been actually transferred and spent – without any measurable output. with its 90 employees just burned the money in the speed
of US$ 0.5 million per month. Advent decided to disrupt the financing
surprisingly early.

Scott Rogers, founder and CEO of,
said that his company expected to have at least one more year to reach
the profitability. He sees the reason of the failure in market
conditions. “The markets have been very bad, this is evident,” he said.

Nevertheless, not all is that bad. isn’t going to file
for bankruptcy; it is able to satisfy all its obligations. “For such a
short period of time to build a base of 30 business development
partnerships, 50 paying advertising clients and experience 400+ percent traffic
growth is quite an achievement for such a young company. We are proud of
what we have accomplished in this region,” said Chip Schenck, one of
the founders of the company.

The future of is uncertain. Although officially are all
the operations to be closed in few days, Rogers simultaneously said
that several staff members will stay and maintain the Web site, hoping
that a new investor could be found.

Local Internet entrepreneurs unanimously say that the failure of is the worst possible message about Czech Internet
market. The company, established by Americans living in Prague, has been
a role model for local dot-coms: quick start, successful funding,
comprehensive plans. There is common concern that American investors may
be more suspicious about Prague – and perhaps the Eastern Europe
generally – after this fall.

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