Chemdex was started in 1997 by former Exxon engineer David Perry in Palo Alto, California, and received venture capital from Genentech founder Robert A. Swanson, and from VC firms Kleiner Perkins Caufield & Byers and CMGI@Ventures.
Chemdex's flotation on the NASDAQ exchange in July 1999 (ticker symbol CMDX) was typical of other initial public offerings of "dot-com" companies during the dot-com bubble. At the time Chemdex recorded quarterly sales of $165,000, mostly to Genentech, and had lost $6.8 million in the same quarter. Yet it raised $112.5 million at IPO, and its stock rose 60% on the first day, valuing the whole company (including those shares still privately held) at over $750 million).
Chemdex spawned its own parent, Ventro Corporation. Ventro merged with a number of related businesses, including Specialty MD and Promedix (both specialty medical technology providers) and engaged in joint ventures with Tenet Healthcare and VWR Scientific. By 2000 the company's market capitalization had grown to over $4 billion.
When, as with other similar companies, investors lost confidence in highly-priced but unprofitable internet ventures, Ventro's stock plummeted to only 1% of its previous value, and (unable to find a buyer for the business) Ventro shut its Chemdex division down in early 2001. Instead Ventro concentrated on only providing B2B exchange services to exchanges rather than actually running an exchange. Ventro eventually merged with Nexprise.