Timing is everything in life, so the people who made a movie about the man behind the rise of the one-time Internet phenomenon known as Kozmo.com have to be grinning right now.
The movie, “e-Dreams,” debuts this week in New York City, and it’s likely that some of the 1,100 people who used to work for Kozmo will be among those who see it. They can even go to the matinee, since Kozmo’s shutdown has left them abruptly jobless.
But is Kozmo a tragedy? A cautionary tale? A comedy? Maybe it’s all of the above.
The movie is said to be an eerily revealing documentary of the financial feeding frenzy that was the dot-com bubble before it burst. At one point, Kozmo founder Joseph Park gets up on a piano amid a bar full of partygoers and starts screaming “IPO.”
More like IP-No. Kozmo’s IPO never went anywhere, and now neither does its swarm of bicycle couriers. It’s over and it happened pretty quickly, even by dot-com standards.
As always in this shakeout era, it’s easy to see now how absurd it was for so many investors to put so many millions into an idea that really was more about coolness than anything else. Park reportedly would woo venture capitalists by asking them their favorite ice cream flavor during meetings and then ordering a delivery through his laptop.
No doubt, the investors had the reaction that Park intended: “Hey, that’s cool.” And it was. In the context of the times, it seemed like it couldn’t miss.
But cool doesn’t make money. That might be the funniest part of the Kozmo story. That a simple gimmick like ice cream at a pitch session could have helped free up so much cash.
If so, then the tragedy is that no one saw the instant-gratification nature of Kozmo as too good to be true.
Was it sensible to build a business that is all about spending extra money, just so you can have whatever it is you want — that video, that pint of ice cream — immediately? How many consumers could afford to be so self-indulgent?
Of course, there is a caveat. If the economic good times had rolled on forever, maybe everyone would have been more than willing to continue paying a premium to be waited on hand and foot.
But reality did set in. And the fact is that it had to set in eventually. The New Economy may have new rules, but perpetual good times isn’t one of them.
So Kozmo runs through US$180 million in venture capital in just over three years and leaves hundreds of people out of work and gets a movie made about it. No doubt, some business school will make it required viewing before long. But let’s hope that the messages aren’t blurred along the way.
Not all dot-coms are bad ideas. In fact, not even all of the dot-coms that have come and gone were bad ideas. Some deserved, or deserve, to have successful IPOs and make lots of people rich.
So when seen in that light, the Kozmo crash-and-burn saga is only a cautionary tale to the extent that Kozmo was a good idea too. In other words, not very much of a cautionary tale at all.
Note: The opinions expressed by our columnists are their own and do not necessarily reflect the views of the E-Commerce Times or its management.