The last we heard of FoodUSA.com, the online marketplace focusing on the US meat sector, was that its managers were battling on despite failing to secure further investment. Now that CommerceVentures, the emarketplace founded by a group of the largest meat and poultry producers in the US, is confident of approval from the Justice Department, FoodUSA.com appears to have given up all hope of survival.
Its website is down, with a notice explaining, “FoodUSA.com has temporarily closed day-to-day operations.” The notice goes on to say that much knowledge and goodwill was accumulated at FoodUSA while it was up and running, and that the company is reviewing ways in which it can leverage this experience and other intangible assets such as the brand and software to continue to serve the meat and poultry industry.
However, industry sources are united in assuming that this is indeed the end of the road for FoodUSA. Tom O’Connell, FoodUSA’s marketing officer, said in early January that a statement about the company’s future strategy could be expected within days. That statement failed to appear.
FoodUSA was launched with US$50m of venture funding and by last October had brokered US$30m in meat sales through its 1,350 registered buyers and sellers. However, the cash required to generate these sales quickly ate into the investment, and money ran dry.
The company blamed investor reluctance on the soon-to-emerge CommerceVentures, which boasts industry backing from Tyson/Ibp, as well as Gold Kist and the red meat arms of Cargill and Farmland Industries. The new venture has, however, been a long time in the pipeline, as Smithfield withdrew its initial support for the project around the time it lost out to Tyson in a bidding battle for IBP, and an antitrust investigation was launched.
CommerceVentures has appointed Dean Foods‘ Kevin Nemetz as CEO and has set up an office in Chicago. Nemetz said that “We’re moving at breakneck speed to complete everything,” and trading is expected to begin this year under the name Provision X.
For our last story on FoodUSA.com, click here.