Chemdex.com
Encyclopedia
Chemdex.com was one of the first online business-to-business
(B2B) e-commerce companies. Based in the United States
, Chemdex provided an online marketplace for sales of chemicals, enzymes, lab equipment, biotech products like peptides, and many types of chemical reagents. Once an IPO darling of Wall Street, it was never profitable and it became one of many companies destroyed in the dot-com crash of the early 2000s.
Chemdex was started in 1997 by former Exxon
engineer David Perry in Palo Alto, California
, and received venture capital
from Genentech
founder Robert A. Swanson
, and from VC firms Kleiner Perkins Caufield & Byers and CMGI@Ventures
.
Chemdex's flotation on the NASDAQ
exchange in July 1999 (ticker symbol CMDX) was typical of other initial public offering
s of "dot-com" companies during the dot-com bubble
. At the time Chemdex recorded quarterly sales of $165,000, mostly to Genentech, and had lost $6.8 million in the same quarter. Yet it raised $112.5 million at IPO, and its stock rose 60% on the first day, valuing the whole company (including those shares still privately held) at over $750 million).
Chemdex spawned its own parent, Ventro Corporation. Ventro merged with a number of related businesses, including Specialty MD and Promedix (both specialty medical technology providers) and engaged in joint ventures with Tenet Healthcare
and VWR Scientific. By 2000 the company's market capitalization
had grown to over $4 billion.
When, as with other similar companies, investors lost confidence in highly-priced but unprofitable internet ventures, Ventro's stock plummeted to only 1% of its previous value, and (unable to find a buyer for the business) Ventro shut its Chemdex division down in early 2001. Instead Ventro concentrated on only providing B2B exchange services to exchanges rather than actually running an exchange. Ventro eventually merged with Nexprise.
Business-to-business
Business-to-business describes commerce transactions between businesses, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer...
(B2B) e-commerce companies. Based in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, Chemdex provided an online marketplace for sales of chemicals, enzymes, lab equipment, biotech products like peptides, and many types of chemical reagents. Once an IPO darling of Wall Street, it was never profitable and it became one of many companies destroyed in the dot-com crash of the early 2000s.
Chemdex was started in 1997 by former Exxon
Exxon
Exxon is a chain of gas stations as well as a brand of motor fuel and related products by ExxonMobil. From 1972 to 1999, Exxon was the corporate name of the company previously known as Standard Oil Company of New Jersey or Jersey Standard....
engineer David Perry in Palo Alto, California
Palo Alto, California
Palo Alto is a California charter city located in the northwest corner of Santa Clara County, in the San Francisco Bay Area of California, United States. The city shares its borders with East Palo Alto, Mountain View, Los Altos, Los Altos Hills, Stanford, Portola Valley, and Menlo Park. It is...
, and received venture capital
Venture capital
Venture capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as...
from Genentech
Genentech
Genentech Inc., or Genetic Engineering Technology, Inc., is a biotechnology corporation, founded in 1976 by venture capitalist Robert A. Swanson and biochemist Dr. Herbert Boyer. Trailing the founding of Cetus by five years, it was an important step in the evolution of the biotechnology industry...
founder Robert A. Swanson
Robert A. Swanson
Robert A. Swanson was a venture capitalist who cofounded the biotechnology giant Genentech in 1976 with Herbert Boyer. Genentech is a pioneer in the field, and it remains one of the leading biotech companies in the world....
, and from VC firms Kleiner Perkins Caufield & Byers and CMGI@Ventures
CMGI
ModusLink Global Solutions, formerly CMGI Inc., is an American technology and venture capital company, headquartered in Waltham, Massachusetts. The company supplies a range of internet and communications services, mostly to computer companies, its biggest customer being Hewlett-Packard Company...
.
Chemdex's flotation on the NASDAQ
NASDAQ
The NASDAQ Stock Market, also known as the NASDAQ, is an American stock exchange. "NASDAQ" originally stood for "National Association of Securities Dealers Automated Quotations". It is the second-largest stock exchange by market capitalization in the world, after the New York Stock Exchange. As of...
exchange in July 1999 (ticker symbol CMDX) was typical of other initial public offering
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...
s of "dot-com" companies during the dot-com bubble
Dot-com bubble
The dot-com bubble was a speculative bubble covering roughly 1995–2000 during which stock markets in industrialized nations saw their equity value rise rapidly from growth in the more...
. At the time Chemdex recorded quarterly sales of $165,000, mostly to Genentech, and had lost $6.8 million in the same quarter. Yet it raised $112.5 million at IPO, and its stock rose 60% on the first day, valuing the whole company (including those shares still privately held) at over $750 million).
Chemdex spawned its own parent, Ventro Corporation. Ventro merged with a number of related businesses, including Specialty MD and Promedix (both specialty medical technology providers) and engaged in joint ventures with Tenet Healthcare
Tenet Healthcare
Tenet Healthcare Corporation, an investor-owned health-care delivery systems company based in Dallas, Texas. THC owns and operates 49 acute-care hospitals in 11 states and 90 outpatient centers in 12 states, with a majority of these hospitals in California, Florida and Texas...
and VWR Scientific. By 2000 the company's market capitalization
Market capitalization
Market capitalization is a measurement of the value of the ownership interest that shareholders hold in a business enterprise. It is equal to the share price times the number of shares outstanding of a publicly traded company...
had grown to over $4 billion.
When, as with other similar companies, investors lost confidence in highly-priced but unprofitable internet ventures, Ventro's stock plummeted to only 1% of its previous value, and (unable to find a buyer for the business) Ventro shut its Chemdex division down in early 2001. Instead Ventro concentrated on only providing B2B exchange services to exchanges rather than actually running an exchange. Ventro eventually merged with Nexprise.
External links
- Archive of Chemdex's website (circa 1999), stored by Internet ArchiveInternet ArchiveThe Internet Archive is a non-profit digital library with the stated mission of "universal access to all knowledge". It offers permanent storage and access to collections of digitized materials, including websites, music, moving images, and nearly 3 million public domain books. The Internet Archive...
- Online B2B Marketplace
- Global Online B2B Portal
- [www.tradekey.com/index.html?action=product_search&search_in=1&criteria=2&keyword=chemical+suppliers&country= Chemical Suppliers Online Marketplace]