Clickmango folds

Actress Joanna Lumley was an investor in Clickmango

Online health and beauty company Clickmango.com has confirmed that it will go out of business just three months after opening its virtual shop.

The firm was founded last September by Toby Rowland, son of the late tycoon Tiny Rowland, and Robert Norton.

The company quickly raised the £3m it needed for its April launch but has since been unable to raise an additional £300,000 needed to keep the company going until the autumn.

Mr Norton said the firm would close in September, unless it could secure some fresh money.

"We don't see the climate changing in our favour over the next two months," he said.

The company, whose figurehead is Joanna Lumley, had hoped to find a white knight to provide investment and a future for the company.

All creditors and the 20 staff will be paid off, the company said.

Internet blow

The collapse of Clickmango - although not as spectacular as the demise of Boo.com - is a further blow to the online retailing sector.

Online clothing seller Boo collapsed in May through lack of funds, just six months after it launched to a huge fanfare of publicity.

Mr Norton is keen to distance the company's failure from Boo.

"This is not Boo Two. We still have money in the bank and we have not spent a fortune on advertising. We have made the decision to wind down the company in a responsible fashion to make sure creditors and staff get full payment," he said.

Many internet companies have found it difficult to raise the cash they need to continue doing business since investor sentiment turned against technology stocks earlier this year.

"We are under-budget and over our sales targets. The sad thing is we will never get the opportunity to see if this business would have worked," Mr Rowland had told the Sunday Times.

Actress Joanna Lumley invested in the company and became its figurehead when it was launched. Her contract would be honoured, the two founders said on Sunday.

"Joanna has been very supportive of us through this difficult period," Mr Rowland said.