| Webvan | |
|---|---|
 | |
| Fate | Bankrupt |
| Founded | late 1990s |
| Defunct | 2001 |
| Location |  Foster City, California |
| Industry | Online retailer |
Webvan was an online "credit and delivery" grocery business that went bankrupt in 2001. Bankruptcy is a legally declared inability or impairment of ability of an individual or organization to pay their Creditors Creditors may file a bankruptcy petition against The 1990s collectively refers to the years between and including 1990 and 1999 Year 2001 ( MMI) was a Common year starting on Monday according to the Gregorian calendar. Foster City is an affluent Planned city located in San Mateo County California, 94404 Online shopping is the process consumers go through to purchase products or services over the Internet. A grocery store is a store established primarily for the Retailing of Food. Bankruptcy is a legally declared inability or impairment of ability of an individual or organization to pay their Creditors Creditors may file a bankruptcy petition against Year 2001 ( MMI) was a Common year starting on Monday according to the Gregorian calendar. It was headquartered in Foster City, California, USA, near Silicon Valley. Foster City is an affluent Planned city located in San Mateo County California, 94404 For the valley nicknamed "Silicone Valley" see San Fernando Valley. It delivered products to customers' homes within a 30-minute window of their choosing. At its peak, it offered service in ten U. S. markets: San Francisco Bay Area, Dallas, San Diego, Los Angeles, Chicago, Seattle, Portland, Atlanta, Sacramento, and Orange County. The San Francisco Bay Area, commonly known as the Bay Area, or the Bay, is a geographically and ethnically diverse metropolitan region that surrounds the Los Angeles (lɑˈsændʒələs los ˈaŋxeles in Spanish) is the largest City in the state of California and the American West Chicago (ʃɪˈkɑːgoʊ is the largest City by population in the state of Illinois and the American Midwest of the United States. Portland is a city located in the Northwestern United States, near the Confluence of the Willamette and Columbia rivers Orange County is a county in Southern California, United States. The company had originally hoped to expand to 26 cities.
In June 2008, CNET hailed Webvan as one of the greatest dotcom disasters in history. [1]
Contents |
History
Webvan was founded in the heyday of the dot-com boom in the late 1990s by Louis Borders, who also co-founded the Borders bookstore in 1971. The " dot-com bubble " (or sometimes the " IT bubble " was a speculative bubble covering roughly 1995–2001 (with a climax on March 10 The 1990s collectively refers to the years between and including 1990 and 1999 Borders Group ( is an international bookseller based in Ann Arbor, Michigan. Webvan's original investors included Goldman Sachs and Yahoo!, who encouraged it to rapidly build its own infrastructure (the first-mover advantage strategy popularized by Amazon.com) to deliver groceries in a number of cities. The Goldman Sachs Group Inc, or simply Goldman Sachs ( is a large global Bank holding company that engages in Investment banking securities First-mover advantage is the advantage gained by the initial occupant of a market segment Amazoncom Inc ( is an American electronic commerce ( E-commerce) company in Seattle Washington. [2] Some journalists and analysts blamed this serious error of judgment on the fact that none of Webvan's senior executives (or major investors) had any management experience in the supermarket industry, including its CEO George Shaheen who had resigned as head of Andersen Consulting (now Accenture), a management consulting firm, to join the venture. A journalist (also called a newspaperman) is a person who practices Journalism, the gathering and dissemination of information about current events trends George T Shaheen (born July 11, 1944) an American businessman, was chief executive at management consulting firm Andersen Consulting Accenture () is a global Management consulting, Technology services, and Outsourcing company
Webvan tried to embrace a total customer satisfaction model involving a 30 minute window delivery without considering that many working customers would like their groceries delivered at home at night.
Bankruptcy
While Webvan was popular, the money spent on infrastructure far exceeded sales growth, and the company eventually ran out of money. For example: Webvan placed a $1 billion (USD) order with engineering company Bechtel to build its warehouses, bought a fleet of delivery trucks, purchased 30 Sun Microsystems Enterprise 4500 servers, dozens of Compaq ProLiant computers and several Cisco Systems model 7513 and 7507 routers, as well as more than 80 21-inch ViewSonic color monitors and at least 115 Herman Miller Aeron chairs (at over $800 each). The United States dollar ( sign: $; code: USD) is the unit of Currency of the United States; it has also been Bechtel Corporation ( Bechtel Group) is the largest Engineering company in the United States, ranking as the 9th-largest privately owned company in the Sun Microsystems Inc ( is a multinational vendor of Computers computer components Computer software, and Information technology services A server is a Computer dedicated to providing one or more services over a computer network typically through a request-response routine Compaq Computer Corporation was an American Personal computer company founded in 1982 and is now a brand name of Hewlett-Packard. A computer is a Machine that manipulates data according to a list of instructions. A router ('rautər in the USA 'rutər in the UK and Ireland, or either pronunciation in Australia and Canada is a Computer whose software and hardware are usually ViewSonic Corporation is a manufacturer and provider of visual technology specifically CRT monitors Liquid crystal displays Projectors Plasma Herman Miller Inc, based in Zeeland Michigan, is an American Manufacturer of office The Aeron chair is a product of Herman Miller, designed in 1994 by Don Chadwick and Bill Stumpf. [3]
As part of its shutdown process, all non-perishable food was donated to local food banks. Webvan's legacy consists of thousands of colored plastic shipping bins for groceries that are still sitting in customers' basements and closets, and a lucrative severance package for ex-CEO Shaheen. [4]
Similar businesses
The online grocery market sector has seen many other failures, including Publix Direct. Publix Super Markets Inc (commonly known as Publix) is an American Supermarket chain based in Lakeland, Florida. However, there have been a few successes. Two companies founded around the same time as Webvan that still exist today are Peapod started in 1989 in Chicago and SimonDelivers in the Minneapolis-St. Paul region of Minnesota and Wisconsin. This is the article about the delivery service For the actual pod see Pea. SimonDelivers Inc was an Online grocery that primarily served the Minneapolis-St Minnesota ( Native Americans demonstrated the name to early settlers Wisconsin ( or wɪˈskɑnsɨn (French Ouisconsin) is one of the fifty United States of America, located in the north central part of the United States The GTA-area of Toronto is serviced by Grocery Gateway, which has partnered with and is now owned by local grocer Longo's. Grocery Gateway is a Grocery delivery service based in Malton Ontario and serves the entire Greater Toronto Area (GTA The New York City market is increasingly served by FreshDirect and ShopRite from Home. FreshDirect is an Online Grocer that delivers to residences and offices in the New York City metropolitan area Some other companies, such as Peapod in the Northeastern United States, and Winder Farms in the Western United States existed before the Internet became popular, and adapted their business models to the new medium. This is the article about the delivery service For the actual pod see Pea. The Northeast is a region of the United States. As defined by the U Winder Farms, headquartered in West Valley City, Utah, is an online grocer providing dairy and other grocery products to the doorsteps of tens of thousands The Western United States &mdashcommonly referred to as the American West or simply the West &mdashtraditionally refers to the region comprising the westernmost Grocer HyVee of the midwest offers a delivery service, sometimes with online ordering, depending on the location / service area. Hy-Vee (ˌhaɪ̪ˈviː is an employee owned chain of supermarkets located in the Midwestern United States. Many cities in western Canada (including Calgary and Winnipeg) are served by the delivery company Pic n Del, which partners with local supermarkets such as Calgary CO-OP, Sobeys, and Canada Safeway[1]. Calgary (ˈkælgəriː is the largest city in the Province of Alberta, Canada Winnipeg (ˈwɪnɨpɛg is the capital and largest city in the Canadian province of Manitoba, and 7th largest municipality in Canada with a population Calgary Co-operative Association Limited (commonly referred to as Calgary Co-op) is a retail Cooperative operating in Calgary Alberta, Canada Sobeys is the second largest food retailer in Canada, with over 1300 supermarkets operating under a variety of banners
Amazon has also recently unveiled "Amazon Fresh", an online grocery delivery service serving Seattle, Washington.
See also
References
- ^ The greatest defunct Web sites and dotcom disasters. Electronic commerce, commonly known as e-commerce' or eCommerce, consists of the buying and selling of products or services over electronic This is the article about the delivery service For the actual pod see Pea. A stock market bubble is a type of Economic bubble taking place in Stock markets when price of Stocks rise and become overvalued by any measure of Stock For other uses of the term Irrational exuberance, see the Irrational exuberance (disambiguation article CNET (2008-06-05). 2008 ( MMVIII) is the current year in accordance with the Gregorian calendar, a Leap year that started on Tuesday of the Common Events 70 - Titus and his Roman Legions breach the middle wall of Jerusalem in the Siege of Jerusalem Retrieved on 2008-06-05. 2008 ( MMVIII) is the current year in accordance with the Gregorian calendar, a Leap year that started on Tuesday of the Common Events 70 - Titus and his Roman Legions breach the middle wall of Jerusalem in the Siege of Jerusalem
- ^ Finkelstein, Sydney; Harvey, Charles & Lawton, Thomas (2007). Breakout Strategy: Meeting the Challenge of Double-digit Growth. McGraw-Hill, p200. ISBN 0-07-145231-1.
- ^ Wolverton, Troy. "Seeking relics amid Webvan's ruins", CNET News. com, 2001-10-30. Year 2001 ( MMI) was a Common year starting on Monday according to the Gregorian calendar. Events 637 - Antioch surrenders to the Muslim forces under Rashidun Caliphate after the Battle of Iron bridge. Retrieved on 2007-04-30. Year 2007 ( MMVII) was a Common year starting on Monday of the Gregorian calendar in the 21st century. Events 313 - Roman emperor Licinius unifies the entire Eastern Roman Empire under his rule
- ^ Sandoval, Greg. "Ex-Webvan CEO to collect $375,000 yearly", CNET News. com, 2001-05-15. Year 2001 ( MMI) was a Common year starting on Monday according to the Gregorian calendar. Events 1252 - Pope Innocent IV issues the Papal bull Ad exstirpanda, which authorizes but also limits the Retrieved on 2007-04-30. Year 2007 ( MMVII) was a Common year starting on Monday of the Gregorian calendar in the 21st century. Events 313 - Roman emperor Licinius unifies the entire Eastern Roman Empire under his rule
External links
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