Street-UK dies, first big UK Web content casualty
By Richard Meares
LONDON, Nov 16 (Reuters) - TheStreet.co.uk became Britain's first big Web content casualty on Thursday when the online financial newspaper said it was closing immediately due to lack of funding.
The plug was pulled by its U.S. parent company, TheStreet.com <TSCM.O>, which itself announced cutbacks as it learns it can be hard to make money on the Internet.
A spokesman for the UK unit told Reuters the British Website had met its financial targets and was making revenues of about a quarter of a million pounds ($356,000) a month, but it had not proved enough.
"We need to be funded over at least the next year and TheStreet.com decided that was not where it wanted to invest its money," he said.
The Street.com said its British operations accounted for about $9 million of the group's consolidated new losses for the nine months ended September 30, and would have run out of money by the end of the year.
Staff were only told of the decision on Thursday, and all 64 of them were being made redundant with immediate effect.
Launched in February, TheStreet.co.uk built up a strong reputation for financial news, especially in the "new economy" of technology and telecommunications, and gained 180,000 registered users.
The site had four million page impressions a month.
The spokesman said the operation would be wound down "professionally," and obligations to creditors and staff would be met.
As venture capitalists and other investors have shunned the Internet sector as surely as they embraced it a year ago, funding has put the squeeze on numerous companies that are still months or years from making a profit.
The first high-profile casualty in Britain was Boo.com, the high-spending, ultra-hip fashion retailer that spent its way through scores of millions of dollars before its investors decided to cut their losses and closed it in May.
Healthcare retailer Clickmango, Anglo-Swedish CD seller Boxman and Urbanfetch, the British arm of a U.S. company that aimed to deliver e-commerce products to purchasers within an hour, have all followed suit.
But TheStreet.co.uk is the first major information site to fold.
NetImperative, a far smaller Internet and technology news site, narrowly escaped closure six months ago.
Jagnotes, a smaller site set up by a U.S. parent, also closed recently, according to media reports.
The downturn in sentiment towards the Internet has been a double blow for companies like TheStreet.co.uk, because their target audience were the retail online investors who, typically, got their fingers badly burnt as tech stocks crashed.
Despite having more man-in-the-street shareholders for many years than most European neighbours, Britain has not built up a legion of online investors on a scale to compare with European leader Germany.
The online financial news market is crowded, with big names like the Financial Times (FT.com, FTMarketwatch, FTYourMoney) and the Wall Street Journal (wsj.co.uk) competing with startups like BreakingViews and Citywire.
Chase Capital Partners and Barclays Private Equity were in a venture-capital consortium that invested some 10 million pounds in TheStreet.co.uk early this year. They were not immediately available for comment.
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