HomeGrocer.com, Inc. was an

online In computer technology and telecommunications, online indicates a state of connectivity and offline indicates a disconnected state. In modern terminology, this usually refers to an Internet connection, but (especially when expressed "on line" or ...

supermarket A supermarket is a self-service Retail#Types of outlets, shop offering a wide variety of food, Drink, beverages and Household goods, household products, organized into sections. This kind of store is larger and has a wider selection than earli ...

business. The company was originally started in 1997 by Terry Drayton, Mike Donald, James Fierro and Ken Deering.

History

The product selection was a complete alternative to the traditional supermarket at comparable prices with a reputation they earned for top quality fresh produce, seafood and meat. Deliveries were made in custom tri-temperature trucks with the distinctive HomeGrocer ''peach logo''. Customer support was very strong and new facilities were opened in

Portland, OR Portland (, ) is a port city in the Pacific Northwest and the largest city in the U.S. state of Oregon. Situated at the confluence of the Willamette and Columbia rivers, Portland is the county seat of Multnomah County, the most populous cou ...

in May 1999, in

Renton, WA Renton is a city in King County, Washington, and an inner-ring suburb of Seattle. Situated southeast of downtown Seattle, Renton straddles the southeast shore of Lake Washington, at the mouth of the Cedar River. As of the 2020 census, the pop ...

in September 1999, in

Irvine, CA Irvine () is a master-planned city in South Orange County, California, United States, in the Los Angeles metropolitan area. The Irvine Company started developing the area in the 1960s and the city was formally incorporated on December 28, 1971. ...

in October 1999, in Fullerton, CA in January 2000, in Carson, CA in February 2000 in Azusa, CA in March, 2000, in San Diego, CA in April 2000 and in Dallas, TX in May, 2000. Each of these new facilities operated 7 days a week and all were with 50 delivery vehicles and a staff of 200. Daily sales reached over $1M per day by June 2000, at which time a total of 16 additional HomeGrocer facilities were under construction in markets including Atlanta, GA, Chicago, IL, Washington, DC. and Denver, CO. HomeGrocer developed all of its own technology including its award winning website, its wireless picking systems that used WiFi, and its driver "smart phones", all years before they were mainstream. HomeGrocer completed a $288M IPO in March 2000 underwritten by

Morgan Stanley Morgan Stanley is an American multinational investment management and financial services company headquartered at 1585 Broadway in Midtown Manhattan, New York City. With offices in more than 41 countries and more than 75,000 employees, the fir ...

and DLJ but needed more capital to meet the aggressive roll-out that was already well underway. With the onset of the dot-com crisis, this capital became unavailable at any price, thereby leaving the company few alternatives to survive. In September 2000, stockholders approved a $1.2B all stock buyout by the cash-rich competitor

Webvan Webvan was a dot-com company and grocery business that filed for bankruptcy in 2001 after 3 years of operation. It was headquartered in Foster City, California, United States. It delivered products to customers' homes within a 30-minute window o ...

of the much larger HomeGrocer.com. HomeGrocer was rebranded to Webvan, the management team fired and the technology and processes converted to Webvan. The Webvan technology did not work very well and their execution was poor. Most telling, the eight different HomeGrocer facilities converted to Webvan saw overnight sales declines of one-third, then over 50% within two weeks and never recovered. Formerly profitable HomeGrocer facilities quickly ended up with significant losses. Studies of what happened after the merger were not kind to the original Webvan management who spent over $500M before going bankrupt less than a year later. HomeGrocer sales peaked in November 2000 at over $1.5M, per day making it the largest Internet grocery business ever created, until UK-based

Ocado Ocado Group is a British business based in Hatfield, England, which licenses grocery technology. It owns a 50% share of Ocado.com (the other 50% is owned by UK retailer Marks & Spencer) and licenses its grocery fulfilment technology to global ...

exceeded it in 2010. The HomeGrocer brand was purchased out of bankruptcy and eventually ended up being owned by

Amazon.com Amazon.com, Inc. ( ) is an American multinational technology company focusing on e-commerce, cloud computing, online advertising, digital streaming, and artificial intelligence. It has been referred to as "one of the most influential economi ...

Funding

HomeGrocer raised a total of $440M in investments from

Kleiner Perkins Caufield & Byers Kleiner Perkins, formerly Kleiner Perkins Caufield & Byers (KPCB), is an American venture capital firm which specializes in investing in incubation, early stage and growth companies. Since its founding in 1972, the firm has backed entrepreneurs ...

, John Malone of

Liberty Media Liberty Media Corporation (commonly referred to as Liberty Media or just Liberty) is an American mass media company controlled by chairman John C. Malone. The company has three divisions, reflecting the company's ownership stakes in Formula One ...

Solstice A solstice is an event that occurs when the Sun appears to reach its most northerly or southerly excursion relative to the celestial equator on the celestial sphere. Two solstices occur annually, around June 21 and December 21. In many countr ...

Martha Stewart Martha Helen Stewart (, ; born August 3, 1941) is an American retail businesswoman, writer, and television personality. As founder of Martha Stewart Living Omnimedia, she gained success through a variety of business ventures, encompassing pub ...

and

Jim Barksdale James Love Barksdale (born January 24, 1943) is an American executive who served as the president and CEO of Netscape from January 1995 until the company merged with AOL in March 1999. Early life James Barksdale was born in Jackson, Mississipp ...

.Barksdale invests in HomeGrocer
/ref>

References

{{Dot-com Bubble Companies based in Bellevue, Washington Defunct companies based in Kirkland, Washington Internet properties disestablished in 2000 Internet properties established in 1997 Online food retailers of the United States Retail companies established in 1997 Retail companies disestablished in 2000 1997 establishments in Washington (state) 2000 disestablishments in Washington (state) Defunct online companies of the United States