Da Boom

Ah, the Boom, remember the Boom?

It seems like only yesterday when I was surfing online and easily ordering my videos, snacks and bags of groceries to be schlepped to my door through the rotten Chicago snow via Kozmo.com and Webvan.com. So as you can expect, I was genuinely bummed when both companies tanked with nary a whimper (both within the same time frame - during what historians will always call the DotCom Bust). The ugly writing was clearly on the wall for all of these folks, as it really did not take a Harvard MBA to see that the grocery delivery/everything delivery thing was surely a doomed business model from the get go.

For instance, my girlfried and I used to order our groceries from Webvan.com, to be delivered at a certain time on a certain day and I would watch as the guy hauled up box after box of victuals up the stairs and then spend another five minutes unloading the boxes on our kitchen table and floor. Now this show took about 10-15 minutes minimum, not including the 5 to 10 minutes that flashed by when he drove by the apartment three times looking for the number, the backing up or the not being able to get close enough to park and then having to rummage through the truck a block away in the snow. So by the time the guy left our apartment, he'd now wasted at least 20-30 minutes bringing us $100 dollars worth of top quality (it generally was) groceries.

Now, go to the grocery store down the street and see how many people they can blast through the checkout line in the same amount of time. At least 6 or 7 or more with a good checkout person. That's probably a cool $1000 every 20 minutes at each checkout counter (let's just say four are open for the exercise) and well, do the math ($4000 every twenty minutes during the busy rush hours). By the time Mr. Webvan drove his gas sucking truck to the next location ten blocks away, he MIGHT, just might be able to make TWO deliveries per hour for a total of maybe $200-$300 bucks.

Voila, shitty business model that was so doomed to fail it boggles the mind that they were able to burn up over 300 million bucks.

Same with Kozmo.com. The orginal idea started in New York: put some kids on mopeds delivering videos and snacks. Good idea in New York, bad idea in LA, Chicago, Atlanta and all the other places where they quickly expanded. The Kozmo catalog was a trip. You could order a new DVD player for god's sake (at full retail markup) to be delivered to your door at 11 o'clock at night. Their catalog began to resemble the Sharper Image catalog. It was geared towards people who were drunk, lonely and had no fear of their credit cards: "Mmm, uh yes, like I'd like to order the movie Stripes, two 2-liter cokes and uh, oh yea, toss in a friggin massage chair please and some high end audio equipment while your at it. How long will that take to get here? Thirty minutes, great."

The bottom line is that they all sucked through a gazillion dollars of venture capital and every one of them tanked. I used to follow all the high dollar shenanigans on the old FuckedCompany.com website. It's actually still around, but I'm not so sure it's as funny or relevant as it was during the good old dot com bust. Anyway, I saw this list today on MSN and it brought back some "old" memories (not even five years ago - ancient!)