Okonkwo Prelims

company in an emerging business sector. However, these young entrepre-

neurs obtained investment backing of more than £80m (approximately

US$130m at the time) in cash from investors that included investment banks

JP Morgan and Goldman Sachs, LVMH chairman Bernard Arnault, the

Benetton family and several Middle Eastern investors.

With strong financial backing, envisaged global operations and a business

concept that seemed to be eagerly anticipated by both shareholders and

consumers, the three entrepreneurs went about setting up the business that

was at the time aiming to be the world’s premier e-retailer of high-end fash-

ion goods and an online global brand.

Boo.com was expected to lead a market revolution and to conquer the new

business channel provided by the internet. The company was launched during

the period of the emergence of several start-up pure-play e-retailers also

known as the dotcom companies. Consequently, the sector needed strong

influential companies as a blueprint for the business channel. Boo.com aspired

to fit the bill. The business community and beyond were enthusiastic about

the company which was seen as the next major e-retailer after amazon.com.

Prior to the company’s launch, boo.com was declared to be one of Europe’s

coolest companies by American business magazine, Fortune. As a result, its

stock market worth soared and boosted investor confidence. The aspiration of

boo.com was, however, doomed to have a short history.

Boo.com was launched in November 1999 amidst fanfare and anticipated

success. The company was headquartered in London but began with simulta-

neous operations in 18 countries including offices in Paris, New York,

Stockholm, Munich and several other locations. Remarkably, six months

later, in May 2000, these offices closed down as the story of boo.com ended

as dramatically as it started. Boo.com therefore became the first major casu-

alty of the internet era and made the number one spot on the list of the ‘100

Dumbest Moments in e-Business History’.

It is worth asking how such a company could fail. It is also important to

establish whether Boo.com failed as a company or as a result of its activities

in e-commerce.

Business concept and strategy

At the time of boo.com’s launch, its founders stated the following:

We believe very strongly that in Boo.com there is a formula for a successful busi-

ness, and fervently hope that those who are now responsible for dealing with the

company will recognize this.

In retrospect, it is evident that boo.com had no clearly defined business

concept or strategic plan except the over ambitious plan to make the company

both the largest and most sophisticated e-retailer of fashion goods in the

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luxury fashion branding