Is Pets.com Discontinued? What Happened?
Fate: Pets.com shut down in November 2000, 268 days after its IPO. The company had lost $147 million in the first nine months of 2000 and could not find a path to profitability. The sock puppet's rights were later sold for $125,000.
Pets.com launched in 1998 as an online store selling pet food, cat litter, toys, and other pet supplies shipped directly to your door. The idea fit the moment. In the late 1990s, investors and entrepreneurs believed the internet would move nearly every kind of retail online, and pet supplies seemed like a natural category.
The company raised money quickly. Amazon put in $50 million and ended up with about a 30 percent stake. Venture capital firms added more. By the time Pets.com went public in February 2000, it had raised over $300 million in total funding.
The sock puppet appeared in ads starting in August 1999 and became the face of the brand almost immediately. He was a hand puppet with a microphone, friendly and a little sarcastic, and he showed up on television, in print ads, and in the Macy’s Thanksgiving Day Parade. In January 2000 the sock puppet appeared in a Super Bowl ad, which was one of the most expensive advertising placements available. The spot ran just days before the company’s IPO.
But the business had a problem that all the marketing in the world could not fix. Shipping heavy items like bags of dog food or jugs of cat litter across the country cost more than the company was charging customers. Pets.com was selling products at or below what it paid for them, then paying again to ship them. The more customers it attracted, the more money it lost on each order.
The IPO raised about $82.5 million. The stock opened at $11 per share and never really recovered. By the fall of 2000, the dot-com market had turned and investors were no longer willing to fund companies burning through cash without a path to profit. Pets.com lost $147 million in just the first nine months of 2000.
In November 2000, just 268 days after the IPO, Pets.com announced it was shutting down. Inventory was liquidated and the company closed. The sock puppet’s rights were eventually sold for $125,000 in 2002. Pets.com is still frequently cited as the most recognizable example of the dot-com bubble.
Timeline
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1998
- Pets.com launches as an online pet supply retailer. Amazon invests $50 million and takes a significant stake in the company.
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1999
- August — The sock puppet mascot appears in advertising for the first time and quickly becomes the recognizable face of the brand.
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2000
- January — The sock puppet appears in a Super Bowl ad, one of the most expensive advertising placements of the year.
- February — Pets.com goes public on the Nasdaq at $11 per share, raising about $82.5 million. Total funding raised exceeds $300 million.
- November — Pets.com shuts down, 268 days after its IPO. The company lost $147 million in the first nine months of 2000. Inventory is liquidated and the site goes dark.
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2002
- The rights to the sock puppet are sold for $125,000 to a group called Sock Puppet LLC.
Frequently Asked Questions
What happened to Pets.com?
Pets.com shut down in November 2000, 268 days after its IPO. The company had lost $147 million in the first nine months of 2000 and could not find a path to profitability. The sock puppet's rights were later sold for $125,000.
When did Pets.com close?
Pets.com closed in 2000. Pets.com shut down in November 2000, 268 days after its IPO. The company had lost $147 million in the first nine months of 2000 and could not find a path to profitability. The sock puppet's rights were later sold for $125,000.
Is Pets.com still in business?
Pets.com has been discontinued or significantly changed. Pets.com shut down in November 2000, 268 days after its IPO. The company had lost $147 million in the first nine months of 2000 and could not find a path to profitability. The sock puppet's rights were later sold for $125,000.
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