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Several high-profile U.K. dot-coms also ran into difficulties. One of the most highly publicized failures was the closure of fashion retailer Boo.com, which is making a comeback next week under new ownership. The company had spent heavily on complex technology so it could display its hip line of clothing. Industry experts also pointed to inexperienced management. But others say the simple truth is Boo.com and other online ventures have found it difficult to generate profits. A gloomy report from PricewaterhouseCoopers points out that one in four U.K. Internet companies will use up their cash reserves in the next six months, while the majority will run out of money within 15 months. The difficulties may have taken the gloss off the sector, but many say a more realistic approach was long overdue. "I'm cautiously optimistic," says Meyer. Smaller startups have learned from their predecessors' mistakes and are forcing the larger E-commerce ventures to sit up and take notice. U.S. companies should take notice, too. Despite its slow start, Europe is starting to erode the United States' lead in E-commerce. To get in on the ground floor, the time is right to consider launching European business operations--and the British Isles have many advantages in geography, culture, and business climate, as well as governments who are eager to encourage E-commerce adoption. Forward spin: Meyer expects to announce several new pan-European projects later this month.
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Julie Meyer, co-founder of Internet-entrepreneur networking group
First Tuesday, agrees. "We don't have that deep bench of talent
because the business is so new," she says. First Tuesday is a networking
channel for Internet entrepreneurs and venture capitalists. Venture
capitalists have funded hundreds of new Internet businesses in retailing,
travel, online marketplaces, software, and services. But a downturn
in stock prices in the early part of the year undermined confidence
and frightened investors.
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