Chris Kitze, the white knight investor who rescued San Francisco online retailer Wine.com a few years ago, may need something stronger than wine to get over his company’s latest saga.
Here’s the story that ran in the Mercury News today, and an important clarification. As usual, we were limited in what we could say in the paper version, and were forced to skip over many excruciating details for sake of brevity. Basically, though, Kitze is about to lose most of his money in Wine.com after a group of tough-nosed investors snatched the company away. Kitze isn’t talking, but other players confirmed the outcome of the valley’s latest blood battle.
Here, though, is the important clarification. It is on a point made by George Garrick, the company’s CEO — who has just left the company under protest, even though his name is still up on the Web site. Unfortunately, we cut a crucial part of his quote. The part in bold is what we didn’t carry in the paper:
“My job is to be the CEO,” Garrick told us. “I can’t do that job if a single controlling shareholder is going to use their voting rights to further their own interests at the expense of other shareholders by unilaterally overruling decisions that the Board and the Management Team have made.”
This is important because the board itself had made a decision to support management’s plans, he and others told us. Garrick even signed off on the deal to be acquired. Valuable time was spent, in getting this done. The company ran out of options. But then Baker unilaterally changed its mind, and pulls the plug. Garrick additionally told us: “With this latest financing, Wine.com is essentially a subsidiary of Baker Capital.”
We will likely file a correction in the paper. Apologies to Garrick.
We are still trying to reach the Baker folks for their side of the story. We put in more calls this morning.
Anyway, below are links to our earlier chapters of this never-ending Wine.com opus.
The more recent stuff comes first. We’ve highlighted the main stories in bold. We also note that several players in this story have taken exception to the way we’ve characterized the causes of Wine.com’s continuous failings. Various players, founders, CEOs clearly held different visions, or had different understandings of the online wine market. We agree, it is not fair to lump them all into a single basket and say they all misunderstood the complexities of America’s regulated wine market. It is just that no one was able to get it all focused properly. It is the sad story of Wine.com.
–2004: Kitze and team raises more money, with new investor Baker leading the round. This, we surmise, is where Kitze probably should have instead sold the company and gotten out. But that would be armchair quarterbacking on Monday.
–2004: Kitze recruits A-Team.
–2003: Kitze raises some more money, begins to steady the ship.
–2003: Under Kitze, new CEO Ekman strikes some initial deals and rejigs focus.
–2002: Kitze arrives (free registration), total restart.
–2001: Some ex-Wine.com folks form a different venture, New Vine Logistics.
–2001: Creditor Sand Hill Capital transfers Wine.com’s assets, such as customer lists, etc, to eVineyard, and oversees auction of much of Wine.com’s stock (scroll down).
–2001: First full story of Wine.com’s implosion.
–2000: Rivals Wine.com and Wineshopper.com merge.
–1999: Initial story
about how wine retailers Wine.com and Winesopper.com face off against each other.