Rendezvous With Reality

From the “I Wasn’t Wrong, Just Premature” Dept.: In mid-August, while writing about and its online furniture Web site partner, which had just shut down, I made an inaccurate, passing reference to as being out of business.

The exact quote was, “Selling furniture over the Internet has been, and will continue to be, a non-starter. It was a stupid idea for CMGI and its entry into that market, the late, and it was a stupid idea for and the world’s largest e-tailer.”

A reader objected, noting correctly that, if not exactly flourishing, was still alive.

Now it appears, in a refreshing reversal of roles, that reality has caught up with me. The Massachusetts-based home furnishings Web site on Monday announced it would cease operations and sell its assets. A dozen employees will remain to oversee liquidation.

The only real question now is what possibly possessed CMGI and other investors to sink $27 million more into in June, when its fate was already as clear as a crystal Etrurian Centerpiece Bowl that once could be yours from for only $418.

Almost anyone could see that’s investors – CMGI’s @Ventures affiliate, Bessemer Venture Partners and others – were throwing good money after bad, accomplishing little more than extending life support for a terminal patient and buying time for those employees who hadn’t yet been laid off to explore other job options.

But company officials continued to deny the obvious, claiming in a press release announcing the desperation funding that “continues to accelerate its path to profitability.”

The truth was that only days before, had been exploring bankruptcy as an option. Worse, in May, according to a July CNET story, employees were forced to “sit in the company’s call center and ‘look busy,’ helping imaginary customers while speaking into dead phone lines” for the benefit of two visiting executives from Internet incubator idealab.

It’s hard to believe that this pathetic company earlier this year was planning a public offering. If there’s one bright side to this year’s meltdown of Internet stocks, it’s that it chilled the IPO market and saved investors from losing even more money on dogs like

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