Boo.com falls from the edge of technology

In the startup environment, it is a habit to talk about successes to keep our hopes alive for the future, but it is a big mistake to forget the failures of the past and not benefit from the experiences of the past. For this purpose, the Ecomotive team has collected the experiences of a series of failed startups, so that reviewing their failed stories may be a basis for the success of new startups in Iran’s startup community. This series will be published in the format of the failure story section and will be available to the audience. In the following, the fifteenth part of this series will be about the failure story of the startup Boo.com. Let’s review together.

Boo.com was an English internet company that was founded in the fall of 1999 by a couple of Swedes named Ernst Melmsten, Kaisa Linder and Patrick Hedlin, with the aim of selling branded clothes online. The company’s headquarters were located on London’s Carnby Street, in the same building as the offices of Erotic Revive magazine. The office, which had only 40 employees in October 1999, quickly grew to eight offices and 400 employees in Amsterdam, Munich, New York City, Paris and Stockholm.

Although the company was able to attract 135 million dollars in capital, but within 18 months, with the wrong policies it adopted, it spent all its capital, without having much sales (80 million dollars of this amount was spent at a time It turned out that not even a single species had been sold).

Boo.com wanted to achieve rapid and simultaneous growth in several European countries, so it spent a lot of time and money on its development. While the website was not yet ready, the company spent a lot of money on advertising and curious users waited for its unveiling for a long time. Over time, Boo.com also neglected the development of innovation in the field of technology, and when its website was officially launched, it was complicated and full of Java and Flash files, as well as the slow speed of the site at a time when high-speed Internet was still not available. It was not widespread, it confused the users, and this caused the sales to not reach the expected level after a while.

On the other hand, Boo.com’s growth plan was based on the assumption that in the first few years, capital would be available so that the company’s sales would be equal to its operating costs. But this hypothesis also failed in the second quarter of 2000 due to the bursting of the Boo.com bubble and the fall in the value of the wrong company’s shares, and it officially faced an irreparable challenge.

One of the biggest losing investors among them, Omnia It was from the rich Lebanese family; This means that the Hariri family was supported and had invested more than 2 million dollars in this company.

Finally, on May 18, 2000, the company was placed in the trust of the court and its assets were liquidated. Two years later, other internet companies suffered the same fate.

In 2001, a book called “Boo Hoo: A dot.com Story from Concept to Catastrophe” was published by Ernst Melmsten, in which he told about his experiences. A few years later, CNET called Boo.com one of the biggest crashes in history.

As late as 2003, stickers from the company’s advertising campaign were still seen on the streets of London, proclaiming: “Fashion never dies!”