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The Failure of E-Commerce Businesses: A Surprise or Not?
Published online by Cambridge University Press: 17 February 2009
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Only a couple years ago various analysts were hailing the arrival of a radically new economy fueled by the expansion of information technology and focused on the Internet. New Internet-based businesses were coming to life every day, attracting some of the best human capital available – both new MBA's fresh out of school and seasoned managers from management consulting firms and the so-called “old-economy” companies. Since in the very short run the supply of talent is fixed, salaries for these talented individuals skyrocketed under the influence of this explosion in demand. A few of the established companies and management consulting firms even set up so-called e-business incubators in an attempt to stop the exodus of talent. They also invested in the development of these e-businesses with the hope of getting a share of returns that were expected to be phenomenal. Furthermore, financial capital flowed to e-business not only directly through these incubators but also from many venture capital firms and private investors.
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- Copyright © T.M.C. Asser Press and the Authors 2002
References
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50 It is debatable whether “mixed” firms should really be considered e-commerce firms since they really operate as traditional firms while exploiting the benefits of the Internet. Still they do participate in e-commerce and thus deserve mention.
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