Matchmine Flames Out Suddenly
[10:00 a.m. 10/28/08: Update and clarification included below.]
In an entry cross-posted on the company blog and his personal blog this afternoon, Mike Troiano, CEO of Needham, MA-based recommendation technology startup Matchmine, said the company is shutting down, effective immediately. The failure of the company, which raised $10 million in venture financing just last year, throws at least 40 software engineers, product managers, and business development executives out of work.
The Matchmine website is no longer available, and redirects visitors to the blog, which is headed by Troiano’s message, entitled simply “Fin.” Troiano says Matchmine employees were informed of the shutdown this morning. While the company’s doors are already closed, “a few of us will stick around to try and support our partners through a transition, and notify others affected by the closing,” the post says. The company’s partners should expect calls soon, Troiano said.
Matchmine, as I explained in a profile last September, was in the midst of rolling out a system that automatically recommends music, movies, and other types of media based on the individual tastes of users, as encoded in personalized mathematical representations known as “MatchKeys.” Funded mainly by the Kraft Group, which also owns the New England Patriots, Matchmine had established partnerships with several Web-based media companies, including Fuzz, Filmcrave, Peerflix, Odeo, Blogdigger, Blogged, and MediaMelon; the companies were incorporating the MatchKey technology into their own sites’ product search and recommendation systems.
Matchmine’s path was not untroubled. In an April story following up on my original profile, I recounted how the company was forced to scrap the original system it developed for building MatchKeys as too complex and forbidding for most consumers. After the company’s public debut at the Demo conference in September 2007, six months elapsed before the company got its recommendation service working on the first two partner sites. In that time, “We made a bunch of headway and uncovered a bunch of opportunities as well as a bunch of problems with the product side of things,” Troiano told me at the time.
And while the company continued to sign up new retail partners over the summer—including ffwd.com, Pixsy, Podcast.com, Videocast.com, Muzic.com, and MP34U.com—it never scored the kind of big customer win (on the scale of a company like eMusic, say) that would have put it on the map in the digital media retailing sector.
In his blog post, Troiano indicates that while the company had been hit hard by the recent financial turmoil, its sudden shutdown was completely unanticipated.
Troiano hints, without explaining, that he had been misled in some way about the startup’s financial situation. [see clarification below]
“The nature of our financing meant that the financial market crisis overtook us more abruptly than most,” Troiano writes. “To my team and their families, our vendors, network partners and prospects, I can only say that I am deeply sorry for the way this comes to a close. And I don’t mean ‘press release sorry;’ I mean really, personally sorry. Please know that I could not have imagined this last Thursday, let alone earlier. It is one thing to be failed, quite another to have been deceived.”
[Update and clarification, 10/28/08: In a response today to my inquiry about that last sentence, Troiano says he was not trying to imply anything about the company’s financial backers. “That sentence…was not about the Krafts at all,” Troiano wrote to me this morning (see my followup story). “I was concerned that the partners we were engaged with—and the prospective partners we were still pitching as late as Thursday—might feel deceived by us. We may have failed them, in good faith, but that’s different than lying through our teeth knowing we were going to shut the company down on Monday. Hence the failure vs. deception distinction.”]
The bulk of Troiano’s post, however, is devoted to a list of Matchmine’s employees, whom other companies “smart enough to be greedy while so many are scared” would do well to snatch up, he argues. These include Trent Adams, the company’s founder and “Chief Innovator,” who first conceived the recommendation technology behind Matchmine’s system while working directly for the Kraft Group.
It’s possible that Matchmine’s recommendation technology will again see the light of day: Troiano says in the post that the company’s intellectual property is now for sale. “We’re open to selling the IP and patent portfolio, and just as willing and able to protect it,” he writes.