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MetalSite Headed For Scrap Heap?
MetalSite closes E-marketplace and lays off most of its staff.
June 8, 2001
1 Min Read
MetalSite Inc. may be the next online exchange to join the E-commerce scrap heap. On Wednesday, the company closed its E-marketplace for steel and laid off most of its 72-person staff. The company didn't siphon off enough fees from the $200 million in orders it facilitated through electronic auctions and catalogs last year and couldn't persuade investors, which include Bethlehem Steel, LTV Steel, Wierton Steel, and Internet Capital Group, to refill its empty coffers.
Company executives continue to seek new funding and hope to revive the site in a few weeks. But it may be tough to forge more investments within the steel industry. The market is struggling with a glut of production capacity that has pounded down prices this year and has led to bankruptcy for some steel producers, including LTV.
MetalSite, which launched in 1998, was an early entrant in the E-marketplace boom that spawned the creation of hundreds of industry exchanges seeking to cash in on the Internet IPO fervor. Now, many of those sites are out of business, including industry-sponsored sites like PetroCosm and Freightwise. MetalSite attracted more than 4,000 customers in its three years of operation, conducted 100,000 auctions last year, and closed 50,000 sale transactions. Its competitor, e-Steel Corp., is still standing.
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