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Net marketplace eSprocket cuts half its staff

The chief executive of the online marketplace says the layoffs were made to reduce the company's cash burn rate while the company gains traction in the increasingly competitive industry.

Online marketplace eSprocket has cut its staff by 50 percent, according to the company's chief executive.

Ben Coes, CEO of eSprocket, declined to discuss the exact number of employees that were laid off, but sources close to the company said nearly 50 workers were employed prior to the cutbacks.

Coes said the layoffs were made to reduce eSprocket's cash burn rate while the company is "gaining traction" in the industry.

Boston-based eSprocket hosts buyers and sellers of used equipment from businesses, specifically metalwork machinery.

"As with any company, you have to look at the expenses," Coes said. "We took a prudent step to maintain our viability within a competitive market."

The huge rise in the number of business-to-business companies during the last year has begun to give way to a shakeout much like the one ravaging the e-tail industry. Marketplaces and exchanges are finding that their competition is increasing and that their sales are slowing.

Competitors of privately held eSprocket in the online marketplace industry include FreeMarkets and DoveBid. Bessemer Ventures and Chase Capital Partners were eSprocket's lead investors.