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| Type | Private |
|---|---|
| Industry | Online Auction and Fixed Price Merchandise |
| Founded | Chicago, Illinois, USA (1997) |
| Headquarters | Itasca, Illinois, USA |
| Key people | Scott Koerner, President and CEO, uBid Holdings, Inc. |
| Products | Consumer merchandise including electronics, computers, jewelry, fine art, housewares, computer accessories |
| Website | www.ubid.com www.redtag.com |
uBid.com manages an online auction and shopping website that offers both goods sold directly by the company and items sold by pre-approved uBid Certified Merchants.
Contents |
[edit] Overview
uBid.com, a wholly owned subsidiary of Sunrise Bidders, Inc., was founded in 1997 and is headquartered in Itasca, Illinois. The site offers both products sold through uBid.com and products offered by other established businesses through the uBid Certified Merchant Program. The site specializes in new, refurbished and overstock consumer electronics such as computers and cellular phones, but has recently expanded to offer other services such as travel packages and jewelry. uBid'com's sister website RedTag.com offers a single, new Deal of the Day each day, representing the lowest web posted price available.
[edit] History
The company has been acquired and divested multiple times.
CMGI acquired the company from its founders in 2000 for $407 million.[1] The company is still memorialized at the home of the New England Patriots, formerly CMGI Field, now Gillette Stadium, with the "uBid.com Entrance."[2]
In 2003, CMGI sold uBid to Takumi Interactive, a holding company formed to manage its purchase by Thomas Petters and the Petters Group of Minnetonka, Minnesota.[3] In Petters' recent criminal trial on numerous Federal charges, Petters testified that uBid was profitable,[4] which was untrue.
In September 2007, Jeff Hoffman, a founder of Priceline, joined the company as its CEO. Mr. Hoffman restructured the company into several units, and focused it on the liquidation of excess inventory. Mr. Hoffman obtained the domain name redtag.com from Petters, and created a fixed-price liquidation site by that name. He also instituted liquidation sales at specific temporary sites, bulk excess inventory liquidations via Dibu Trading Corporation, and "Commerce Innovations," a company that sold auctioning technology. Mr. Hoffman spent a large amount of capital the company held in reserve on these efforts, while drastically scaling back its marketing and advertising efforts.
Mr. Hoffman also closed the company's auction subsidiary, bidville.com, in 2008.[5]
After Mr. Petters' arrest, uBid laid off a large portion of its workforce in an effort to contain costs. Management announced 12 layoffs, but the truth was 31% of its workforce or between 22-28 employees.[6]
Subsequently, On December 2, 2008, the company received financing from Robert T. Geras, on terms that essentially gave Mr. Geras and his wife warrants for a controlling interest, in exchange for a loan of approximately $1.5 million.[7] In 2009, Mr. Geras resigned his position on the company's board of directors.
On December 22, 2009, Mr. Hoffman resigned from the company. uBid co-founder Timothy E. Takesue was named interim CEO.[8]
On March 1, 2010, Patrick L. Neville, a corporate turnaround specialist, became the company's CEO.
[edit] 2010 bankruptcy and acquisition
In September 2010, a group of unsecured creditors forced Enable Holdings, uBid's former holding company, into bankruptcy.[9] On October 8, 2010, Sunrise Bidders purchased uBid and other assets at a court-authorized auction, and appointed Mr. Scott Koerner as the company's president.
[edit] uBid v. GoDaddy
In 2009, uBid commenced a lawsuit against GoDaddy, in Federal Court in Chicago, accusing the company of profiting off of domain names that were similar to its trademarked names. uBid accuses Godaddy of unlawfully profiting by placing paid advertisements into parking pages, and splitting revenues with its customers, who uBid alleges to be cybersquatters. The lawsuit was originally dismissed for a lack of jurisdiction, but that decision was reversed by the Seventh Circuit in a landmark case. The case was pending before U.S. District Judge Charles Kocoras, but was dismissedby agreement on October 17, 2011, having apparently been settled.
[edit] uBid Certified Merchant Program
In order to maintain a trusted trading environment, uBid only allows established businesses who have been pre-approved to sell products on its site. Merchants wishing to be approved must provide tax and credit information as well as trade and bank references to prove their credibility. Once approved, Certified Merchants are allowed to sell their products on the site, however all payments and customer service inquiries are made directly through uBid in order to maintain consumer trust and provide the best possible post-sale service. Due to this system, Certified Merchants do not have any direct interaction with customers except for questions asked about products through the uBid site, nor do they see customers' credit card information.
[edit] Other
uBid.com announced in February 2011 the formation of uBid.com Business, which is the company's B2B arm, providing revenue from SMB, government, education and other business customers.
[edit] Notes
- ^ "CMGI To Acquire uBid.com". http://www.encyclopedia.com/doc/1G1-59316870.html. Retrieved 2009-12-01.
- ^ "Gillette Stadium". http://www.gillettestadium.com/stadium_information/index.cfm?ac=quick_facts. Retrieved 2009-12-01.
- ^ "Takumi Interactive, Inc. Purchases uBid Business". http://www.ubid.com/about/Press_room/Press18.asp. Retrieved 2009-12-01.
- ^ "Petters blames top associates for alleged fraud". http://www.google.com/hostednews/ap/article/ALeqM5gS62tzzY_3x-DLYX-79KKhZ0nB2wD9C2ADB84. Retrieved 2009-12-01.
- ^ "uBid to Close eBay Rival Bidville.com". http://blog.auctionbytes.com/cgi-bin/blog/blog.pl?/pl/2008/10/1223698446.html. Retrieved 2009-12-01.
- ^ "Pink-Slip Monday for Ecommerce with uBid, eBay Layoffs". http://www.auctionbytes.com/cab/abn/y08/m05/i26/s01. Retrieved 2009-12-30.
- ^ "Enable Holdings, Form 3, 12-2-2008.". http://google.brand.edgar-online.com/DisplayFiling.aspx?TabIndex=2&FilingID=6279633&companyid=397723&ppu=%252fdefault.aspx%253fcompanyid%253d397723%2526amp%253bformtypeId%253d66. Retrieved 2009-12-01.
- ^ "Enable Holdings 8-K, dated December 30, 2009". http://biz.yahoo.com/e/091230/enab.ob8-k.html. Retrieved 2009-12-30.
- ^ "uBid Auction Site's Parent Enable Holdings Forced into Bankruptcy". http://www.auctionbytes.com/cab/abn/y10/m10/i01/s02. Retrieved 2011-08-03.
