Another one bites the dust..

December 8, 2000 10:00 PM

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.
posted by ZachsMind (1 comment total)

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.
posted by Steven Den Beste at 1:43 PM on December 9, 2000