n2N Commerce no more
TechCrunch reports on the first start-up death of 2008 (or the last of 2007, perhaps), involving Cambridge-based n2N Commerce.
The company officially launched last January with a $30 million round of funding from Limited Brands and General Catalyst. Joel Cutler and Larry Bohn were the GC board members. Ruben Pinchanski, one of Boston's pioneers of Web development and e-commerce, was the CEO.
One entrepreneur who heard news of the company's troubles tells me that n2N laid off about 70 people before Christmas.
Update: I'm told that the decision to shut-down n2N wasn't made by the full board, but by Limited Brands, which unfortunately was the company's lead investor and primary customer. I suspect we'll see some legal action, since it doesn't sound like GC is too happy about putting money into a start-up that was given just one year to prove its model. GC had two board seats, as did Limited Brands. Pinchanski was the fifth board member.
The company officially launched last January with a $30 million round of funding from Limited Brands and General Catalyst. Joel Cutler and Larry Bohn were the GC board members. Ruben Pinchanski, one of Boston's pioneers of Web development and e-commerce, was the CEO.
One entrepreneur who heard news of the company's troubles tells me that n2N laid off about 70 people before Christmas.
Update: I'm told that the decision to shut-down n2N wasn't made by the full board, but by Limited Brands, which unfortunately was the company's lead investor and primary customer. I suspect we'll see some legal action, since it doesn't sound like GC is too happy about putting money into a start-up that was given just one year to prove its model. GC had two board seats, as did Limited Brands. Pinchanski was the fifth board member.
Labels: e-commerce, General Catalyst, Limited Brands, n2N Commerce
posted by Scott Kirsner at
9:59 AM
8 Comments:
Limited Brands, as a seat, did not make the decision.
n2N had one primary customer - namely Limited Brands' child company, Victoria's Secret Direct. Child companies, while operated under the umbrella of the parent, are generally responsible for their own business decisions.
When n2N failed to deliver its promised specification to the adequate approval of Victoria's Secret Direct, VSD made the decision to no longer remain a client of n2N.
Since VSD was n2N's bread-and-butter, so to speak, n2N no longer had any more customers. Without customers, there is no business. It's that simple.
your update sounds like General Catalyst spin. if Limited wanted out, they can get out, right? and if General Catalyst still had the faith in the platform/concept/team/strategy, they could have kept going, no? if in fact Gen cat invested $30MM on such a flimsy ridiculous deal/setup, Gen Cat's LPs should be livid
Chris,
How do you know who made the decision? You are obviously not someone who is close to the company as you're comments are inaccurate at best. Perhaps you are one of the many agents of The Limited's PR machine that is trolling the web trying to control what the public thinks of their actions. In the end the truth comes out. And this is not the end.
BillG,
My comment was not inaccurate according to several articles regarding the issue.
n2N failed to deliver, and the customer withdrew. If one of my service providers fails to deliver on promises, why would I continue business with them?
If VSD was n2N's only customer, and n2N failed to deliver as promised, what do you expect would happen?
After Missing Key Milestones, N2N Calls it the End
"...the 18-month-old startup had missed a series of milestones in delivering its technology to key customer Victoria’s Secret, prompting the lingerie firm to withdraw its business and essentially sealing N2N’s fate."
Following loss of Victoria's Secret deal, n2N to close shop
"The website had been scheduled to launch during the second half of 2007, but didn't happen."
I can understand your upset if you're somehow directly connected with n2N, but that doesn't negate what happened. It's unfortunate, but it's capitalism. There are winners and losers, and n2N didn't come out on the winning side.
chris,
You should be in politics if you are not already. Your selective quoting and jumping to the easy conclusions just makes your comments all the more suspect.
The article from www.xconomy.com that you quote goes on to say....
"Our source believes N2N’s technology was promising, and “not an unqualified failure.” However, the source adds, “they definitely missed some important milestones.” Also evidently contributing to N2N’s problems was internal politics at Limited Brands, the corporate parent of Victoria’s Secret. The source did not elaborate on that point."
If you selectively believe everything you read then you will never learn the truth. And just because you read something in other uninformed articles doesn't negate the fact that your comments are still inaccurate.
Chris -
I agree with you that building a business around one customer is a dangerous thing to do... but lots of venture-backed start-ups get some leeway and some time to build a broader customer base. I was just struck by how quickly the lights were turned out here...
Scott
No founders, no passion, no one with enough skin in the game to make a case to continue.
Maybe the Limited Brands was tired of funneling money into the coffers of other GC funded companies.
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