2 of the Biggest Dot Com Failures

Remember the high and mighty 1990s when cash was flowing against all logic into web startups? I certainly do. It is an interesting time and demonstrates what hype and mania can do in a free market if left to run rampant. These investors, and people in general, had such unrealistic expectations of what the internet could do at the time of its infancy that I honestly feel like they got in “too early” as an adopter before the tech and culture was really there to support their entrepreneurial endeavors.


This decade of hype and bubble bursting has left a long trail of dead companies behind them in its wake. The list is huge. Way too huge for the scope of this article. Yet we can examine a few of the most famous ones out there, ones that many still remember fondly today before they crashed and burned into an uneventful demise.


2 Companies that Failed Big Time During the Dot Com Era


1 – Pets.com – The Loveable Mascot that Could Not


Pets.com was famous for its sock puppet dog mascot. They ran huge marketing commercials, they were everywhere. From the television such as super bowl ads, to just walking down the street where the sock puppet would be interviewing random people on the streets.


The company lost over $147 million dollars in less than a year. The model was to sell pet supplies to retail consumers. And while this can work in today’s market (just look at PetSmart for instance), the market was not yet mature enough to sustain such wild marketing spend and infrastructure.


The company began in 1998 and after going public their stocks started at $11 with a small rally to $14 before falling less than a $1. Soon after that, the company closed its doors in 2000 for good.


2 – eToys.com – The Story of the Bankrupt, Broken Toy


The online toy retailer had many things in common with other dot com bubble companies. Namely, it had an insanely large marketing budget that failed to track any kind of return on investment, over and over again. The millions of dollars it spent would eventually lead eToys.com to tank itself, even after so many stock investors had invested heavily in the company.


The reasoning was that the company wanted to compete head to head against other giant retailers in the toy niche such as Amazon and Walmart (and ToysRus that was starting to get a large web presence).


Alas, it could not. When eToys.com needed a much required cash infusion, they were left wanting and because of this they closed their doors in 2001. Through their bankruptcy, KB Toys bought the domain only for themselves to go bankrupt later.

Perhaps, eToys.com is the most cursed domain for businesses now. Yet that has not stopped ToysRus from acquiring the domain and redirecting it to their website, just in case anyone is still loyal to the eToys.com brand.


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