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The Wine.com Curse Strikes Again
from the drink-up! dept
If you're looking for a startup to avoid, may we humbly suggest Wine.com? There's just something about the name that seems to cause problems. The name itself has been bought and sold by a few different companies, all of whom eventually ran into trouble. During the boom years just about every major online wine seller owned the name Wine.com at one point or another through merger or buying it when an earlier version went out of business. A few years ago, the investors in the 2002 version of Wine.com (apparently, like with wine, Wine.com now needs to be named with the year of its vintage) forced out many of its investors with onerous terms that went beyond even the standard onerous terms in the post-bubble years. However, there's just something about that name, and no matter how many times Wine.coms fail, someone else comes along to try again. The latest version was rumored to be running into cash flow problems earlier this year, but had apparently put in place a lot of other successful initiatives. In order to deal with the cashflow problem, they were looking at various strategic alternatives, including a buyout. Now, Matt Marshall at the San Jose Mercury News has some of the back room details of how one investor quashed a good acquisition option at the last minute (as the cash situation became more dire) and forced the company to take a new round of investment at a much lower valuation, giving that particular investor control of the company. These types of things happen all too often in the startup world, but the stories rarely come out, so it's good to see Marshall and the Merc pointing the spotlight at it. Update: Marshall has a bit more info about the story at SiliconBeat as well.
Reader Comments
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No Subject Given
This is because people don't buy wine on the interweb. Geez, that's like buying wine in a can.
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Re: No Subject Given
I've bought wine on the web, and it's same stuff you buy in the stores, just like a DVD you buy online is the same thing you buy in the stores. To compare buying wine online to buying wine in a can is idiotic.
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Re: No Subject Given
If I'm buying any decent wine I want to know how it was stored since that will affect wine immensely. No internet buying for me unless it's the website of a regional wine club.
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Re: No Subject Given
Agreed. My DVD from Netflix can be bumped around for hours in a hot mail truck and still function fine when I want to watch it. But risk that with an expensive bottle of wine? I don't think so.
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The Vintonesians
Wine is a shrinking industry worldwide, since fewer people drink it every year, even in France. It's so hard to buy wine in bottles other than huge ones that are too tall for the refrigerator. The only thing I ever use wine for is cooking, so it would be nice if they could make them in cooking-friendly shorter bottles.
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Re: The Vintonesians
You are wrong.
The wine industry is not shrinking, just take a look at distributors like constellation.
If anything the market and sales of wine are growing. Just go to a good resteraunt and ask them how many bottles they go through in a night.
I work in a liquor store and we have been seeing an increase in wine sales in the last few years.
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Re: The Vintonesians
never feed dorpus
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Re: The Vintonesians
Wine is actually growing exponentially worldwide...where do you get your facts. A recent Gallop poll announced that wine surpassed beer as the #1 favored alcoholic beverage in the Unites States, and I don't think I need to go into wine's mass appeal in Europe and abroad. China is even becoming a target for fine wine. I don't know about internet sales, but at least get the facts straight.
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it's not about selling wine online
That's not what the story is about tho. The company was a success, raking profit and going for an IPO. So obviously people are willing to buy wine online. Tee story is much more interesting, giving insight into the shrewd practices of investors and these event could have happened with any business.
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