Online health and beauty product retailer Clickmango.com today admitted that it is shutting its virtual doors after only three months.
The shock announcement represents the biggest blow to UK ebusiness since Boo.com's spectacular fall from grace.
Until recently, Clickmango, which boasted Absolutely Fabulous' Joanna Lumley as a figurehead, looked like it had the right recipe.
Clickmango's founders, Toby Rowland and Robert Norton, managed to raise an impressive £3m in venture capital funding in just one week. But as the tide turned against dotcom stocks, the company's appeal started to fade.
Clickmango's funding company Atlas Venture refused to invest any further. This meant that Clickmango failed to raise the £300,000 that it needed to stay afloat until the autumn, despite trying to sell off a sizeable chunk of its equity.
The company will not be trading insolvently and said it will honour all customer orders until the end of August.
Clickmango is closing down while it still has money left to pay its creditors, said Norton. "Rather than risk insolvency, we're closing the company down now while we have plenty of money left to meet all of our obligations and give our staff time to find new positions," he said.
"This is not 'Boo II'. We still have money in the bank and we have not spent a fortune on advertising."
Norton claimed that Clickmango spent less than 10 per cent of its cash on advertising but refused to release sales or earnings figures.
Investing actress Joanna Lumley has a six-month break clause in her contract, which the company said it would honour.
First published on uk.internet.com
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