January 05, 2001, 11:18 AM — CMGI-backed MotherNature.com Inc. said yesterday it is closing its virtual doors, less than one year after it went public.
In a statement, the Concord, Mass.-based online vitamin retailer cited lack of financing as one reason for its decision to shut down. In September, the company laid off 25 employees, or 20% of its workforce, in an effort to save money.
MotherNature.com said it will hold a special meeting for shareholders Nov. 30 to consider its plan for liquidation. If the plan is approved, the company said it will have approximately $13.4 million in assets, or 85 cents per share, to distribute to its stockholders.
MotherNature.com didn't immediately return a telephone call seeking comment.
The announcement by MotherNature.com came one day after another CMGI-backed company, Furniture.com in Framingham, Mass., also said it was discontinuing operations because it lacked funding.
Krista Thomas, a spokeswoman for Andover-Mass.-based CMGI Inc., said the demise of these companies isn't a reflection of the financial stability of CMGI.
"The two [closings] are not related," said Thomas. "And [CMGI] doesn't have any more influence over these decisions than anyone else who sits on the board of these companies. We have a vote but no more influence than any other company on the board."
In addition, Thomas said, while CMGI Ventures, an affiliate of CMGI Inc., holds a stake in MotherNature.com, it is a separate entity from CMGI Inc. "CMGI [Ventures] is different than the majority-owned model [companies], including AltaVista and UBid, that are 80%-owned by CMGI Inc.," she said.
MotherNature.com., in its statement, also said it had been unsuccessful in finding a buyer or strategic alliance partner acceptable to the company.
MotherNature.com isn't the only online seller of vitamins and health care products that has faced financial hardship.
Last month, Drugstore.com Inc. in Bellevue, Wash., said it was laying off 10% of its approximately 600 employees in the wake of a net loss of $33.3 million for the third quarter. At that time, the company also warned that it expects a similar loss in the fourth quarter and a deficit of as much as $110 million for next year.
Eve.com Inc. in San Francisco said it was unable to achieve profitability selling cosmetics online in the face of stiff competition. And two weeks ago, More.com in San Francisco said it was selling most of its assets to HealthCentral.com in Emeryville, Calif.
Matt Stamski, an analyst at Gomez Advisors Inc. in Lincoln, Mass., said MotherNature's announcement epitomizes the business-to-consumer downdraft that is taking place. Just yesterday, for example, San Francisco-based Pets.com said it was shutting down its online pet-supply store, adding another company to the growing list of dot-com failures.