eMeringue Bear's Den
by Zack Murrinir (TMF IBleed)
What is going on here? Wake up Fools! eMeringue is what it sells -- a bunch of
hot air with fluffy coating. The company has reported nothing but losses in
its all too brief corporate life, and I imagine new shareholders today will
eventually be reporting the same thing.
Where can I begin? For starters, CEO Larry McCloskey has an OSHA bull's-eye
painted on the back of his head. According to the eMeringue Web site, its
production facility out in Boise used to be an auto parts dealership. That's a
documented fact. Now, pardon my jaded ways, but it's going to take a lot of
Borax to make me believe that grease stain residue won't make its way onto the
meringue vat. All it takes is one scathing 20/20 segment and the company's e-
commerce future is history.
The problem is that eMeringue is just another substandard company trying to
cash in on the recent Internet craze by going public. A year ago this company
was nothing more than a ranch littered with chicken feed. Today it is the talk
of the investment community. It just doesn't make sense.
eMeringue's haste is evident given the company's absurd choice for a ticker
symbol. H-A-F-D. I'm told it stands for "Have A Foamy Dessert," but I feel
that something cryptic is afoot here Watson.
Now, I'm not some technophobe who thinks that all Internet companies are bad.
If McCloskey were to mine the rich potato harvest of his home state and go
public with eSpud, I might very well be the first to line up for the IPO. That
I can get behind -- but this? It's just that I don't see the synergy here.
The business model is weak. Maintaining that edge over the competition that so
many eMeringue fans point to as the company's crowning achievement has not
come cheap. The company just paid $5 million to be the exclusive online
meringue vendor for the 2002 Winter Olympics. That's a lot of meringue folks.
Or should I say, a lot of sugarcoated hot air?
Next: The Bull Responds
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