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Sprockets Quietly Goes Out of Business

Monday, August 05, 2002

Press release from the issuing company

August 5, 2002 -- (WhatTheyThink.com) -- Sprockets, a collaborative software solutions provider which served the marketing and advertising value chain, has ceased operations according to sources familiar with the company. Sprockets raised over $10 million during its existence, with their most recent coming from Series B financing of $4.2 million in the summer of 2001. Investors in Sprockets were Egan-Managed Capital, Mid-Atlantic Venture Funds, Massachusetts Technology Development Corporation, Hickory Venture Group, The Hatch Group, Capital Southwest Corp. and Mail-Well among others. Sprockets, launched at the 2000 Seybold Conference in Boston, secured a Seybold Hot Pick. Seybold editors noted that Sprockets had a valuable solution for marketing professionals wanting to collaborate with each activity in the marketing process including print. The company was remembered for their unique launch at the conference - securing the B-52s to play at their coming out party which had 2,500 people doing the "Sprock Lobster". The company’s goal was to address the needs of large advertising agencies and corporate marketing departments. Sprockets provided a range of solutions including project management, collaboration, file sharing and delivery, and electronic press kit distribution to corporate marketing groups, ad agencies, production partners and publishers. In March of 2001, Sprockets released its Web Collaboration Platform and core applications. Spending most of their first year of existence developing and testing the platform, it was aimed at dealing with the challenges of group collaboration across the multiple firms involved in print, video, Web, and multi-media projects. In the summer of 2001 and shortly after the Series B financing, founder Mr. Patrick White and the board of directors recruited Mr. Stephen Orenberg as CEO. Mr. Orenberg was previously President of NetGuard, a provider of network security solutions. Mr. White left the company in December of 2001 to concentrate on his other business interests. Reached late last evening, former board member Mr. Patrick White said the company was on track prior to last Falls unfortunate attacks. “We had closed several prestigious accounts, and we had about 100 prospects actively evaluating the product in the Global 2000. As a result of 9/11 and the ensuing sharp decline in the marketplace, agencies and marketing groups faced massive budget and staff cuts. For both practical and political reasons, it was probably not the optimum time to hit your stride.” Mr. White said the Board voted unanimously to cease operations during Spring 2002, Any success Sprockets could have achieved depended on a rebound in the marketing and advertising sectors, which was not in sight and not under the control of the investors. Mr. White noted that on balance, the risk to additional capital was weighted higher than the long-term potential rewards of continued investment. Since April, we have been unable to reach Mr. Orenberg or other company officials for comment. Mr. White spoke individually and not as an employee or representative of Sprockets.com, Inc.

 

 

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