Post number 4702

ZachsMind — Fri, 08 Dec 2000 22:00:14 -0800

Another one bites the dust.. - Riffage is dead. Long live Riffage. Just as well. I never liked their webdesign anyway, but that's a matter of personal taste. I hate to see another soldier for "uncharted territories" fall prey to reality.

By: Steven Den Beste

Steven Den Beste — Sat, 09 Dec 2000 13:43:53 -0800

On the page, it says that one of the reasons they're going under is because "we couldn't find a buyer". In truth, many of the dot-com startups never expected to actually become viable independent businesses, in the sense of actually really honestly making a profit all on their own. The goal was to build to a certain point while losing money, and then try to find someone to sell out to. And for a while you could do that, and some did. Only problem is: if the company's not making a profit and has no expectation of ever making a profit, why would anyone want to buy it? And so, many of the dot-com entrepreneurs have found that they had built and are trying to sell an asset no-one wants. Which is why so many are visiting bankrupcy court -- or are simply liquidating, as in this case. The "new economy" hasn't changed any of the rules of the "old economy"; it's just added some new ones. But the old rules still apply: "income must exceed expenditures in the long run" is just as true for a dot-com as it is for any other business. Ultimately you have to have a viable business plan for becoming profitable. Companies which don't have any such plan will no longer be able to find a sugar-daddy to sell out to. The bubble has burst, and dot-coms will from now on be judged in the same ways that brick-and-mortar businesses are: on the basis of viability and expectation of profit. And this is good. I do not mourn the investments of fools. But the shakeout isn't over yet, and many familiar names will die before it ends.

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Post number 4702

By: Steven Den Beste