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Friends

Oct

2008

Written by David Towers

These outstanding web failures did not require a $700 billion government bail out but they did manage to burn a hole in someone's pocket!

1. Myspace

Myspace terrible website

The idea: Social networking site aimed at 13 year olds.

Spent: Rupert Murdoch paid $327 million for MySpace in July 2005 (more info).

Highlights: More than 100 million users. Users can add friends, customise their profiles, add comments to profile pages and embed music. Myspace was Voted #1 worst website by PCWorld.

What went wrong? Myspace let users personalise their pages making the majority of profiles look horrific and illegible.

More info: here and here.

2. HavenWorks.com

HavenWorks website failure

The idea: News portal

Spent: $120 per year for past 9 years (Hosting cost!)

Highlights: Homepage is over 800k! Over 3600 diggs for HavenWorks being the worst designed website on the net. Received over 70,000 visitors in March (according to Compete).

What went wrong? What didn't? How this site has been online over 9 years defeats imagination. HavenWorks looks more like a pack of sweets than a news website.

More info: Here, here and here.

3. Pets.com

Pets.com website failure

The idea: Sell pet accessories and supplies direct to consumers.

Spent: $82.5 million in 2 years.

Highlights: Most trafficked online pet store at the time. Created a famous sock puppet which appeared on TV ads (watch a medley of Pets.com TV ads here). Ran a Super Bowl ad which cost $1.2 million.

What went wrong? Unsustainable business model. Who wants to wait 2 days for your cat litter to arrive when your cat has already pooped all over the kitchen floor.

More info: Here, here, here and here.

4. Webvan

The idea: Online grocer, sold and delivered groceries within the US.

Spent: $1billion in 18 months.

Highlights: Went from a $1.2bn company with 4,500 employees to bust in less than two years. Share price went from $30 to 6 cents in a few months.

What went wrong? They built an infrastructure that cost over a billion dollars before they had made serious profit. The directors didn't understand the importance of cash flow!

More about WebVan.com here, here and here.

5. Kozmo.com

Kozmo website failure

The idea: Free one-hour delivery of any items above $10 (like DVD rentals or Starbucks coffee) within their service area.

Spent: Over $280 million in 3 years.

Highlights: Amazon invested $60m in Kozmo. Expanded to 7 US cities. Over 1100 employees. Advertised on TV. Documentary film made which portrays the fate of the company (e-Dreams, 2001).

What went wrong? How did they expect to cover the huge start up costs delivering DVD rentals and a pack of gum for free?

More info: Here, here and here.

6. Flooz.com

Flooz failure

The idea: Create an online currency. Can you lend me a Flooz?

Spent: $50 million in 3 years.

Highlights: Promoted by comic actress Whoopi Goldberg. Flooz lasted two and a half years. Russian mafia used Flooz for money laundering!

What went wrong? Who wants to use pay for products using an online currency when they could just use a credit card or when there is a better option of a rewards credit card! What were they thinking?

More info: Here, here and here.

7. eToys.com

eToys website failure

The idea: Sell toys online.

Spent: $166 million in 4 years.

Highlights: Stock went from a high of $84 per share in October 1999 to a low of just 9 cents per share in February 2001.

What went wrong? Classic boom-to-bust, spending outweighed the company's income.

More info: Here and here.

8. Kibu.com

Kibu website failure

The idea: Online community for teenage girls: "fashion, music, and boys"

Spent: $22 million in less than a year.

Highlights: Backed by a number of big Silicon Valley names including Jim Clark. Ran out of money and closed the site 46 days after the launch party!

What went wrong? A spectacular failure. Boom to bust to under a year. Some say Kibu.com was a victim of the fall in the financial markets as a result of the dot com bust.

More info: Here, here and here.

9. Boo.com

Boo.com epic failure

The idea: Sell expensive branded fashion apparel.

Spent: $135 million in 6 months.

Highlights: When Boo.com went bust, they owed over $21million to creditors. Boo.com's software and technology purchased at $70 million, were sold off for $250k.

What went wrong? They built a site using JavaScript and Flash in the days of 56k modems so users had to wait ages to load the site, they also employed 400 people when they only needed 30.

More info: Here, here and here.

10. Microsoft live search

The idea: Create a search service that people will actually use.

Spent: Several billion dollars!

Highlights: Multiple attempts to buy out Yahoo. Launched two programs to entice users to use Live: Cashback and SearchPerks. Cashback was launched in May 2008 and didn't have a significant effect on traffic numbers. SearchPerks was launched on the 1st October and probably won't do much either.

What went wrong? Live's search results are so poor, users can't even be bribed to use it! Live search has less than 10% of the search market.

More info: Here, here and here.

Feedback

What's your take on these 10 Epic failures? Please leave a comment below.

57 Comments



rick_of_racy October 06, 2008 Votes: +8	This is a great list. I remember all of these. The windows live search still sucks. I wanted Kozmo to survive so damn bad. Never got out to the boonies. I don't think a delivery business like that is really able to be profitable. report abuse vote down vote up


Philip Norton October 07, 2008 Votes: +33	Live have a search engine? I thought it was a random website generator! report abuse vote down vote up


Mike K October 07, 2008 Votes: +5	Where's cuil.com, they should be in the list, too! report abuse vote down vote up


Marc October 07, 2008 Votes: -28	I use live search on my mobile phone on a daily basis, and I can tell you it is a great app report abuse vote down vote up


g1smd October 07, 2008 Votes: +2	How the heck can they spend a Billion and get no result? Beggars belief... where did the money go? Someone should have reined it in after the first 20 or 30 million. And at the other end of the scale, some businesses won't even pony up 10K to give themselves a half-decent start on the web... report abuse vote down vote up


MattK October 08, 2008 Votes: +1	Amazing list, isn't it? I remember when Whoopi Goldberg was shilling for Flooz and couldn't help that even the comical Goldberg found the entire concept to be funny. report abuse vote down vote up


Boris October 08, 2008 Votes: -3	5% of the market share is actually a damn good amount of market share, and they are able to stay profitable. Even ask.com which has less than %4 market share is STILL profitable, so don't knock the number three guys! And also, I vaguely remember Flooz, but don't think I understand...why wouldn't someone just use real moneY? report abuse vote down vote up


Matthew October 10, 2008 Votes: -8	thank u r information it very useful u r blog Is very nice report abuse vote down vote up


Internet Marketing Joy October 11, 2008 Votes: -2	This is a very interesting read..I've learned something new today..anyways thanks a lot for sharing it with us! report abuse vote down vote up


Ian October 14, 2008 Votes: +4	On the topic of Windows Live Messenger: I think Google's so dominant that theres no point there being any other search engines. It'll take a really massive amount of creativity of exceed Googles market share. report abuse vote down vote up


Roger October 14, 2008 Votes: +0	Wait.. Flooz.. PayPal.. Difference? report abuse vote down vote up


Hosting Reviews October 14, 2008 Votes: +2	Amazing. So much money simply being poured down the drain. What a ridiculous waste. Incidentally my space is in fact the worst website ever. report abuse vote down vote up


John October 14, 2008 Votes: +1	My company hired eToys VP of customer service for the same position. She succeeded in "cutting overheard" by simply wiping out the budgets of Development and QA, cutting salaries, and replacing them with temps and contracts when they quit... to acclaim of course. She now has the same position at OG&E, so I expect to lose my power any day. report abuse vote down vote up


Doug Rosbury October 14, 2008 Votes: +0	To live according to a fantasy means that you have no foundation in reality. No foundation,No future. No reality, no substance, No foundation for analysis. No real thought. Such an activity amounts to a nothingness.---Doug Rosbury report abuse vote down vote up


Promeus October 14, 2008 Votes: +3	The creator of Myspace is disgustingly rich now and you call it a failure? What exactly is your idea of a success? Is it gross income or the positive impact the site makes on the internet as a whole? Yeah, Myspace may have no redeeming value, but I wouldn't call it a failure just because of an opinion. report abuse vote down vote up


chai g October 14, 2008 Votes: +5	the difference between Flooz and PayPal Flooz = you converted currency (say U.S. dollars) into "Flooz" or money which could only be spent at certain online retailers. PayPal= allows you transfer funds from one person to another (assuming both have PayPal accounts) or to purchase products from any online retailer that accepts PayPal. report abuse vote down vote up


miragana October 14, 2008 Votes: -4	Good day! It is very informative and has a very good quality in it. I like it... Self Improvement Modern Rifle Happy Halloween Thank you very much for your time. report abuse vote down vote up


Beau October 14, 2008 Votes: -3	Flooz is always misunderstood in these types of articles. It was a universal gift certificate, not a way for YOU to spend money. It was to give as a gift, and allow the recipient to shop wherever they wanted. I gave many people Flooz, it was quite handy. report abuse vote down vote up


JoblessPunk October 14, 2008 Votes: -1	haha, I hella remember the Pets.com sock puppet report abuse vote down vote up


Brandon October 14, 2008 Votes: +3	MySpace grossed over $850 million in revenue this year and is projected to break over $1 billion next fiscal year. The much cleaner, better looking Facebook on the other hand is still only predicting $300 million for the next fiscal year and is "valued" at $12 billion. I think Rupert Murdoch was laughing all the way to the bank. He has made his money back many times over and got a steal of a deal. The real sucker is the one who pays full price for Facebook. report abuse vote down vote up


Dpwn October 15, 2008 Votes: +1	@chai g: Flooz...money which could only be spent at certain online retailers. PayPal...purchase products from any online retailer that accepts PayPal. Huh? There IS no difference, other than the fact that PayPal took off and Flooz didn't. Or are you saying that with Flooz you had to convert the money PRIOR to the transaction? Now that it's defunct, we may never know... report abuse vote down vote up


Blake October 15, 2008 Votes: +1	Actually, PayPal can be used anywhere that accepts major credit cards and PayPal Debit. It's a Visa attached to your PayPal. Also, PayPal can be linked directly to a credit card or bank account also. With Flooz, you had to buy credits or got them as promotional items. Just look it up on Wikipedia. You'll see the differences. report abuse vote down vote up


jamie October 15, 2008 Votes: +2	How is Myspace a failure? Yes, it's horribly ugly, and yes, it's full of immature kids, but it's a moneymaking machine for a lot of people. Ask its creator - I'm pretty sure he'd call it a success, at least as far as the business aspect goes. And since this post is centered around the business aspect of these websites... report abuse vote down vote up


Reuben Pressman October 15, 2008 Votes: -2	Very very nice list! report abuse vote down vote up


Danny October 16, 2008 Votes: -1	Myspace is a complete failure, I agree! report abuse vote down vote up


Pranay October 17, 2008 Votes: +0	haha.. monumental failures. although the founders and few more vultures might have benefited, overall the business sense is busted. report abuse vote down vote up


Pranay October 17, 2008 Votes: +0	You may add AOL.com to the list sooner or later, generally sooner. report abuse vote down vote up


mike October 17, 2008 Votes: +1	Selling pet supplies on the web is an "unsustainable business model"???? Then why are petco.com and petsmart.com so successful? eToys.com is a very successful company. They serve as the platform for almost every toy website out there, including toysrus.com and kbtoys.com, among others. Failure? I think not. report abuse vote down vote up


Monty October 18, 2008 Votes: +0	not to sure how myspace is a failure except that it now doesn't have a monopoly in the "social network" sphere. It is a verified cash cow, and is currently estimated at nearly 6x (at MINIMUM)the price Murdoch paid for it. report abuse vote down vote up


tommy October 19, 2008 Votes: +0	Take it from experience. It would be real EASY to start an online company and go bust quick. report abuse vote down vote up


Bill October 19, 2008 Votes: +0	hehe - searchperks only available for residents of the United States. Counts me out! guess i stay with Google. report abuse vote down vote up


Jerke Wadde October 20, 2008 Votes: +0	Your first entry negates the entire list, as MySpace was recently valued at well over a billion, making it a pretty good investment for old Murdoch. report abuse vote down vote up


ioni October 20, 2008 Votes: +0	Funny enough people do use Live search. I see it in the results for people coming over to my site, and a considerable amount of that I clearly see it contrubutable to the Live being the default search engine in IE7. A good one. Sure, not Google, but not lycos altogether report abuse vote down vote up


1 800 Get a Car October 21, 2008 Votes: +0	the pets.com sock puppet is now on car commercials. Everyone deserves a second chance! report abuse vote down vote up


Sarah October 21, 2008 Votes: +0	My favorite Site is Cuil.com report abuse vote down vote up


Harshit Shah October 21, 2008 Votes: +0	And havenworks.com is also not a failure , for it is still running and thanks to such lists, it will keep receiving hits for it to sustain. report abuse vote down vote up


Praveen October 21, 2008 Votes: +0	Windows Live Search still in the list? I see it improved a lot and it is giving meaningful results. report abuse vote down vote up


Ibn Surfin al Intarbut October 21, 2008 Votes: +0	Myspace in BetaWeb was this area approximately 3 feet around you, iside which you only allowed your friends and lovers. MySpace in Web2.0 is the intimate area inside your head where you let the whole world poke around. report abuse vote down vote up


Garrett October 22, 2008 Votes: +1	What about beenz.com, they got raided by police for suspicion of counterfeiting. http://en.wikipedia.org/wiki/Beenz.com report abuse vote down vote up


mohan October 29, 2008 Votes: +1	cant believe that myspace and Live search in this list report abuse vote down vote up


Greathouse November 11, 2008 Votes: +1	okay...how is myspace bad????I enjoy the way I can customize it, and the fact that I can show off my musical preference by embedding the music I would usually listen to.... explain what is wrong with full customization besides the fact that some go over board with stuff that make it look horrible..... Personally, I like my myspace profile more than I like my Facebook myspace- http://www.myspace.com/tokibowl whats wrong with it??? It shows who I am..... report abuse vote down vote up


davesworkout November 19, 2008 Votes: +1	funny stuff about the pets.com, I agree - theres a lot of things i would never buy online, pet food is one of them. report abuse vote down vote up


dollarMAN November 20, 2008 Votes: +0	THANK YOU!!!!!!!!!!!!!!!! That ePet sock puppet has been selling auto insurance lately. I couldn't remember wherethe hell I'd seen it b4. GAWD, we had a huge argumnet, I couldnt prove my case. NOW I AM VINDICATED. THHHHPPPPPTTTTT! report abuse vote down vote up


Disturbed November 24, 2008 Votes: +0	What went wrong with MySpace is this: When it started it was much like Google's homepage. Pure and simple, only what was needed. It slowly became so bogged down with useless garbage that no one cares about, it's just not worth it anymore. It's all about shoving cliche music and videos and ads in your face before you can even get logged on. Not to mention the fact that there is a whole world of spammers that live on MySpace now. They just need to trash the whole site and start over. Just wanted to add a big LOL to that #2 choice though - all I can say after seeing that picture of their site is WTF? report abuse vote down vote up


David T November 28, 2008 Votes: +0	Glad everyone has enjoyed this post! report abuse vote down vote up


Robert December 10, 2008 Votes: +0	I hope I don't end up on this list.... report abuse vote down vote up


MartinMAN January 08, 2009 Votes: -1	Lol! I COMPLETELY agree with this!!!!!!!! My favourite website is google.com - that sure doesn't fail! Lives search engine is like a jig saw randomiser, it's a disgrace! report abuse vote down vote up


MartinMAN January 15, 2009 Votes: -1	Kym please stop harassing me, Google.com has some great features and I do not appreciate little sluts like you coming on here and abusing me kknp? :> report abuse vote down vote up


sbis January 19, 2009 Votes: +0	Can you add also www.italia.it, now death. The idea: Site for any types of informations about Italy. Spent: Italian people paid €58 millions. More info: http://punto-informatico.it/21...-cosi.aspx bye report abuse vote down vote up


davd January 25, 2009 Votes: +0	This post is so good, it should be turned into a whole website chronicling the dotcom bust, and also subsequent busts and misguided (i.e. crazy) web manias. All the sobering stories might save future dotcom investors (however few remain)from repeating these dumb mistakes. In any case, it's entertaining (in a morbid way) while being educational report abuse vote down vote up


Geoserv February 02, 2009 Votes: +0	Good list, some I hadn't heard of. Agree, Cuil.com should be on there as well. report abuse vote down vote up


Lori Cappozzi February 06, 2009 Votes: +0	Good experienced! Some I just know after read this article. MySpace is worst? So interesting report abuse vote down vote up


digsby February 12, 2009 Votes: +0	live search! what a sack of cack. Ms results show you the sites they want you to see.. just use google. 9 times out of ten the page your looking for is the first result report abuse vote down vote up


CS March 07, 2009 Votes: +1	LOL! Havenworks is a classic example of what not to do.. Since when was Myspace a failure? I thought they were raking in cash from ad revenue report abuse vote down vote up


funny March 30, 2009 Votes: +0	thank you very much for this useful information.. report abuse vote down vote up


singularity April 16, 2009 Votes: +0	Cuil.com should have been mentiond in your list. You linked for more information, but not the mentioned sites, many of them are still online, even if they failed. report abuse vote down vote up


Cara Dixon October 19, 2009 Votes: +0	Cannot believe myspace and Windows Live Search failed so spectacularly! What a waste of money! Really interesting post! Thanks for sharing! report abuse vote down vote up