TechnologyBoo’s financial fiasco.

Boo's financial fiasco.

CEO of failed dotcom retail start-up points finger at co-founder with financial responsibility

The KPMG partner who served as interim chief financial officer at notorious dotcom failure boo.com charged the doomed start-up #1,750 a day for her services.

Rachel Yasue, who is still with KPMG, remained with boo until the end as the company’s efforts to recruit a permanent CFO foundered and finally failed.

Details are uncovered in a new book on the short and disastrous life of boo by its former CEO and co-founder Ernst Malmsten.

The book shows the profound problems that blighted boo were exacerbated by a failure to take control of the company’s finances.

In a revealing account about boo’s collapse, Malmsten points the finger at fellow founder Patrik Hedelin who shouldered ‘overall responsibility’ for finance issues.

Malmsten discloses he and his co-founder Kajsa Leander had ‘suspected’ concerns about Hedelin’s handling of the finances. ‘What continued to trouble me was the extent to which his courting of other banks took time away from what I had always felt his main job should be – handling our daily finances and running the finance team,’ he writes.

Boo, founded by the three Swedes in 1998 as a global brand to sell sportswear and fashion, became emblematic of the huge unfulfilled potential of dotcom start-ups when it went bust in spectacular style in May last year.

When KPMG liquidators were called in, boo had burned through nearly $100m (#70m) and had outstanding debts of around $20m.

Hedelin, a investment banker, was forced aside after complaints from investors and Yasue came in. At one stage Australian Dean Hawkins, a former Adidas CFO, was appointed.

Hawkins agreed a salary of #280,000 plus share options. But he was horrified on his arrival to find a $40m round of funding was incomplete and insisted the only way he could continue with the company was if he became chief operations officer, which he did. However, within days he had left to pursue a ‘better offer’.

KPMG finds boo buyers www.accountancyage.com/Business/1102406.

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