1-800-Database files for Chapter 7 Protection | WABE 90.1 FM

1-800-Database files for Chapter 7 Protection

Atlanta, GA – A 6-year-old Norcross company that maintained a database of product information, stock-keeping unit numbers and digital images for hardware and home improvement stores has folded after burning through $25 million in venture funding.
1-800-Database Ltd. shut down in late November after it laid off the last 45 employees who worked for the company. In mid-December, 1-800-Database filed for Chapter 7 bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of Georgia.
President Rob Carter said the company's demise was due, in large part, to the failure of several of the dot-coms with whom 1-800-Database did business, such as failed online grocer Webvan Group Inc. The company's customers also included home improvement giant Lowe's Cos. (NYSE: LOW), the National Hardware Association and the National Housewares Association.
"When the dot-com community hit the skids, we had a significant amount of subscription revenue that could not be collected," Carter said. "We were left high and dry on some major revenue that we had already earned."
Carter said the company had been trying to raise an additional $3 million to $4 million to keep the company afloat, but that directors decided to pull the plug late in the fourth quarter when revenues continued to fall.
"We were at the nexus of a lot of challenges in the move to bring product information to the Internet," Carter said.
Carter, a Harvard Business School graduate, co-founded the company with business partner Steve Kirschner in 1996, when 1-800-Database was spun out of Atlanta merchandising company MarketWare Corp.