SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.  20549

                                    FORM 10-K

(Mark  One)

[x]     Annual Report pursuant to section 13 or 15(d) of the Securities Exchange
Act  of  1934  for  the  fiscal  year  ended  June  30,  2000.

[  ]     Transition  Report  pursuant  to  section 13 or 15(d) of the Securities
Exchange  Act  of  1934  for  the  transition  period  from  ___  to  ____.

                         Commission file number 0-26265

                                Garden.com, Inc.
                       -----------------------------------
             (Exact name of Registrant as Specified in Its Charter)

             Delaware                                74-2765381
-----------------------------------      -----------------------------------
(State  or  Other  Jurisdiction  of     (IRS  Employer  Identification  No.)
 Incorporation  or  Organization)

     3301  Steck  Avenue,  Austin,  TX                 78757
     ---------------------------------                 -----
(Address  of  principal  executive  offices)         (Zip  Code)

        Registrant's telephone number, including area code:  512-532-4000
                                                           --------------

      Securities registered pursuant to Section 12(b) of the Exchange Act:

                                             Name  of  each  exchange  on
Title  of  each  class                       which  registered
     NA                                                NA
     --                                                --

      Securities registered pursuant to Section 12(g) of the Exchange Act:

                     Common Stock, Par Value $.01 Per Share
                ------------------------------------------------
                                (Title of class)

     Indicate  by  check  mark  whether the Registrant (1) has filed all reports
required  to  be  filed by Section 13 or 15(d) of the Securities Exchange Act of
1934  during  the  preceding  12  months  (or  for  such shorter period that the
Registrant  was required to file such reports), and (2) has been subject to such
filing  requirements  for  the  past  90  days.  Yes  X  No
                                                     --    --

     Check if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-K  is  not  contained  herein,  and  will  not  be  contained,  to the best of
Registrant's  knowledge,  in  definitive  proxy  or  information  statements

<PAGE>
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form  10-K.  [  ]

     Aggregate  market  value  of  the  Registrant's  common  stock  held  by
nonaffiliates  as of August 31, 2000:  $17,346,542.  Shares of common stock held
by  any  executive  officer  or  director  of  the Registrant and any person who
beneficially owns 10% or more of the outstanding common stock have been excluded
from this computation because such persons may be deemed to be affiliates.  This
determination  of  affiliate  status is not a conclusive determination for other
purposes.

     Number  of shares of the Registrant's common stock outstanding as of August
31,  2000:  17,739,845.

DOCUMENTS  INCORPORATED  BY  REFERENCE

     Portions  of  the  Proxy  Statement  for  the  2000  Annual  Meeting of the
Stockholders  of  the  Registrant are incorporated by reference into Part III of
this  report.

                                        2
<PAGE>

                                     PART I
                                     ------

ITEM  1.  BUSINESS

THIS  ANNUAL  REPORT  ON  FORM 10-K CONTAINS FORWARD-LOOKING STATEMENTS BASED ON
CURRENT  EXPECTATIONS,  ESTIMATES  AND  PROJECTIONS.  ACTUAL  RESULTS MAY DIFFER
MATERIALLY  FROM  THOSE  EXPRESSED IN FORWARD-LOOKING STATEMENTS.  SEE "ITEM 7 -
MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION AND RESULTS OF
OPERATIONS  -  ADDITIONAL  FACTORS  MAY  AFFECT  FUTURE  RESULTS."

GENERAL

     Garden.com,  Inc.  ("Garden.com" or the "Company") is an online destination
integrating  gardening  and  gardening-related  commerce, content and community.
Primarily  through  its  flagship Web site, www.garden.com, the Company provides
consumers  with  an  intuitive,  easy-to-use  environment through which they can
access  a  wide variety of gardening information and resources, purchase a broad
selection  of products, receive specific gardening advice and other personalized
services  and  interact  with  an  online gardening community.  The Company also
operates  an  additional  gardening site, www.virtualgarden.com.  In addition to
its  Web  site, the Company distributes seasonal, branded catalogs allowing both
existing  and  prospective  customers  an  alternative  means for purchasing the
Company's  product  offerings.  The  Company  offers  its  suppliers  a branding
opportunity, increased sales potential through an expanded customer base and the
ability  to  improve demand forecasting.  By interacting with both its customers
and  suppliers  through  the  Internet,  the  Company  provides consistent, high
quality  customer  service  and  streamlined  distribution.

     The  Company  uses its proprietary supplier information system, TRELLIS, to
provide  information  and  submit  orders to suppliers and to allow customers to
track  their  orders.  The Company has recently launched a new division focusing
on  its  TRELLIS  system  with the intention of offering advanced virtual supply
chain  management  technology  and a service solution to the retail industry and
other  various  industries.

     According  to  its internal database records, the Company estimates that as
of  June  30,  2000,  its  cumulative  membership  increased  to 1.4 million, an
increase  of approximately 117% over 645,000 for the same quarter in fiscal year
1999.  Cumulative  customer  accounts  reached  263,000  as of June 30, 2000, an
increase  of  180%  over  94,000  in  the same quarter of fiscal year 1999.  The
Company's  revenues  have increased to approximately $7.3 million in the quarter
ended  June  30,  2000 from approximately $2.9 million in the quarter ended June
30,  1999.


                                        3
<PAGE>
RESTRUCTURING  PLAN

     On September 28, 2000, the Company announced a corporate restructuring (the
"Restructuring Plan") with the intent of lowering ongoing operating expenses and
reducing  future  capital  requirements.  It  is expected that the Restructuring
Plan  will  cost the Company between $2.5 million and $2.8 million.  Pursuant to
the  Restructuring Plan, the Company reduced its workforce on September 28, 2000
by  93  employees.  In  addition,  the  Company terminated or materially amended
multiple  marketing  initiatives,  including  the  Company's  relationships with
iVillage,  Excite  and  PRIMEDIA, resulting in both write-offs of prepaid assets
and  cash  payments  to  third  parties  to  discontinue  certain  contractual
obligations.

     In connection with the Restructuring Plan, the Company announced the launch
of  its TRELLIS division.  It is anticipated that this division will concentrate
on  developing  additional  revenue  sources  for  the  Company through software
licensing  sales,  ongoing  software  support  fees  and  consulting  revenues.
Additionally, the TRELLIS division will provide ongoing support to the Company's
Internet  and  branded  catalog  based sales efforts.  At formation, the TRELLIS
division  is  comprised  of  16  employees,  or  10%  of  the total workforce of
Garden.com  as  of  September  28,  2000.

     Simultaneous  with  its announcement of the Restructuring Plan, the Company
also  announced that it had engaged the investment bank of Robertson Stephens to
aid  the  Company in evaluating strategic alternatives and to assist the Company
with  ongoing  fund-raising  efforts.

GARDEN.COM  SOLUTION  AND  STRATEGY

     The  Company  provides consumers with an intuitive, easy-to-use environment
through  which  they  can  access  a  wide  variety of gardening information and
resources,  purchase  a  broad  selection  of  products and receive personalized
services,  such  as  specific  gardening  advice,  and  interact with its online
gardening  community.  Key  features  of  the  Company's offerings for gardening
consumers  include:

-     Personalized  Service.  The  Company  targets  personalized  services  and
      content  to  consumers  based  on their individual preferences, geographic
      location  and  level  of  gardening  sophistication.

-     New  Distribution  Channel.  The  Company  has  created a new distribution
      channel  between  its  consumers  and  suppliers  that provides consistent
      customer  service  and  streamlined  distribution.

-     Branded  Catalogs.  The  Company  distributes  seasonal,  branded catalogs
      allowing both existing and prospective customers an  alternative means for
      purchasing  the  Company's  product  offerings.

                                        4
<PAGE>
-     Breadth  and Depth of Product Selection. The Company maintains a broad and
      deep  product  selection  for  its  customers.  The Company's product line
      includes live plants, shrubs, trees, bulbs, seeds, organic fertilizers and
      pesticides,  tools,  furniture,  garden  ornaments,  clothing,  garden
      accessories  and  a  distinctive  garden-inspired  gift  line.

-     Compelling  Content.  The  Company  delivers  compelling  content  on  an
      interactive basis, including daily and weekly online  features,  which are
      hyperlinked  to  companion  product  offerings and which provide gardeners
      with  planting  advice,  design  ideas,  introductions  to  trends  and
      entertaining stories. The Company maintains a large and growing library of
      gardening  photography  which  provides  inspiration  and  a horticultural
      database  which  allows consumers to research  by  attribute  or  keyword.

-     Gardening  Community.  The  Company  has  created a community for users to
      interact and share interests, ideas and gardening information. The Company
      believes that this environment makes gardening information accessible to a
      wide-range of gardeners and allows the gardening community from around the
      world  the  opportunity  to communicate with each other, gardening experts
      and authors, friends and family, Garden.com editors and the Garden Doctor,
      the  Company's  network  of  dedicated  gardening  experts.

     The  Company  intends  to continue to provide products and services to home
gardeners  through  its  Web  site  and  branded  catalogs  while developing its
technology,  including  TRELLIS  and  potentially  other  proprietary  software
applications,  as additional revenue sources.  As reflected in the Restructuring
Plan,  the Company intends to reduce ongoing operating expenses.  Such reduction
in  expenses  combined  with  the  Company's  limited  cash, cash equivalent and
investment  balances  may impair the Company's ability to successfully implement
all or part of the Company's strategy, which would have an adverse effect on the
Company's  business,  operating  results  and  financial  condition.

GARDEN.COM'S  PRODUCTS  AND  SERVICES

     The Company provides consumers with a complete online gardening destination
integrating  gardening commerce, content and community.  The Company believes it
offers  attractive  benefits  to  consumers, including convenience, ease-of-use,
personalization,  enhanced  product  selection, depth of content and information
and  avenues  for community.  Key features of the Garden.com experience include:

     Shopping  Departments  and Utilities.  The Company categorizes its products
into  three  broad  categories: livegoods, hardgoods, and gifts and seasonal.  A
description of these categories and other Garden.com shopping utilities follows.

-     Livegoods.  With  its  broad selection of perennials, herbs, bulbs, seeds,
      trees and shrubs, the Company believes that it currently offers one of the
      largest  selection  of  plants and flowers available from a single source.
      The Company offers consumers a comprehensive selection of both traditional
      and  specialty  plants.  The  Company  also offers a number of preselected
      combinations  of plants and flowers, which the Company markets through its
      Web  site's  editorial  content.  In  addition, the Company sells complete
      garden  kits  comprised  of  plant  collections  and  complementary tools.

                                        5
<PAGE>
-     Hardgoods. The Company offers an extensive selection  of gardening-related
      products including furniture, ornaments, tools, books,  organic  pest  and
      fertilizer  solutions and gardening accessories. The Company believes that
      its  gardening-related  products  complement  its  diverse  plant  product
      offerings.

-     Gifts  and  Seasonal.  The  Company  offers  a  range of holiday, wedding,
      birthday  and  special  occasion gifts, including wreaths, cut flowers and
      bath  and  body  products.  The  Company  has  developed  distinctive gift
      packaging  to  differentiate its brand and to enhance the gift recipient's
      experience.

-     Online  and Branded Catalog Ordering.  Visitors can place items into their
      shopping  "wheelbarrow"  which  can be saved from online session to online
      session.  Customers  can  make  purchases  via  online  secure credit card
      transaction  or  via  a  toll-free  number.

-     Customer Solutions.  Through the Customer Solutions Center, customers gain
      full  access  to  their  order  status,  order  history,  frequently asked
      questions  and  other  customer  services. In addition, Customer Solutions
      provides  general help and horticultural advice through timely response to
      e-mail  and  a  dedicated  toll-free  number.

     Garden Design.  The Company provides its users with the resources necessary
to plan their gardens, design garden plots and choose the appropriate plants for
their  gardens.  The  Company  offers  the  following  specialized garden design
features  to  its  users:

-     Landscape  Planner.  Landscape  Planner  enables  its users to graphically
      design  a  garden  plot, by dragging and dropping plants onto a grid. Once
      the  customer  has  completed the garden design, the customer can purchase
      the  plants  used  in  the  design. Using Landscape Planner, customers can
      further  customize one of the Company's garden designs to meet their needs
      and  preferences.

-     Plant  Finder.  Visitors  can  use  Plant Finder to search its proprietary
      database of plants and flowers to get  suggestions  tailored to a member's
      preferences,  geographic  location,  and  garden  conditions.

-     Garden  Designs  and  Collections  /  Design  Portfolio.  The  Company has
      established  several  predesigned garden plans to provide ideas, highlight
      many  facets  of  gardening  and  inspire creativity. The Design Portfolio
      provides  useful  tips  and  information on garden design and maintenance.
      Once  a  user has researched the garden designs, the user can purchase the
      plants  highlighted  in  the  Company's  Design  Portfolio.

-     Garden  Minder.  Garden.com  members  can  sign  up  for  a  personalized,
      semi-monthly  e-mail on a variety of garden related subjects, such as lawn
      or  rose care, alerting them to time-sensitive garden care and maintenance
      tips.

                                        6
<PAGE>
     Gardening  Content.  The  Company's  retailing  strategy integrates content
with  product  merchandising,  blending  a  publishing  strategy with its retail
efforts.  To  pursue  this  strategy,  the  Company maintains five distinct test
gardens  where  many of its designs, products and how-to features are researched
and  photographed.  Below is a sampling of the content that the Company provides
its  users:

-     Online  Magazine.  Created  exclusively  for online purposes, the magazine
      section  of  garden.com  includes  weekly  inspirational  features, garden
      ideas,  practical  tips,  design  advice  and  planting  guides,  which
      incorporate the latest gardening trends. In addition, the Company provides
      more targeted content focusing on topics such as weekend projects, kitchen
      gardening,  wildlife  and famous gardens of the world. This content serves
      as  a  merchandising  platform to highlight various products and gardening
      activities  offered  on  Garden.com's  Web  site.

-     Regional  Gardening.  For those seeking gardening advice specific to their
      region,  the  Company  offers  specific  ideas  and  planting  advice from
      Garden.com's  ten  regional  gardening editors. In  addition, its Regional
      Gardening  section  highlights  monthly to-do lists, activities and native
      plants.  Sales  promotions  and other gardening utilities are tailored for
      each  of  the  ten  regions  of  the  country  designated  by  Garden.com.

     Community.  The  Company  has  created an environment which makes gardening
information  accessible  to a wide range of gardeners and facilitates discussion
and  exchange  between  gardeners.  In building a successful community of active
members  and  loyal  customers,  the  Company  uses  the  following  features:

-     Chat  Sessions.  Through  the Company's newsgroups and chat rooms, members
      can  easily  communicate  with  each  other,  authors  and other gardening
      experts.  The  Company  also  offers additional activities for its members
      such as live chat sessions with gardening experts and online garden design
      classes.

-     Garden  Doctor.  Through  Garden Doctor, the Company provides a network of
      gardening  experts  dedicated  to answering Garden.com member's questions.
      This  valuable  resource  offers  personalized  solutions to the Company's
      users'  problems.  In  this  way,  the  Company  makes  gardening  more
      approachable  and  enjoyable  to  a  wider  range  of  consumers.

     As  a  result of the reduced expenditures contemplated by the Restructuring
Plan  and  the  Company's limited cash, cash equivalent and investment balances,
the  Company  may  be unable to provide the same commerce, content and community
offerings to consumers.  This reduction in products and services could result in
reduced  product  and  advertising  revenue  levels.


                                        7
<PAGE>
ADVERTISING  SALES

     Through  its  internal  sales  force, the Company has continued to actively
pursue  advertising  sales  as  an  additional  revenue  source.  A  variety  of
marketers,  including  IKEA, GMC Trucks, Nestle's Taster's Choice, Sears.com and
Wells  Fargo  Home  Equity,  have  advertised  with the Company through multiple
advertising  vehicles  including  the  Web  site  and member and customer e-mail
programs.  The  Company  intends  to  continue  to  explore  promotional  and
distribution  arrangements  that  generally  have longer terms and higher dollar
value  than  typical  banner  advertising  deals  to  support  brand  marketing
objectives,  including  product awareness and introductions, online research and
editorial integration.  Advertising sales accounted for approximately 13% of the
Company's  revenues  in  the  fiscal  year  ended  June 30, 2000.  The Company's
ability to grow advertising sales in future periods will depend in part upon its
ability  to  successfully  implement  its  overall strategy at the lower expense
levels  contemplated by the Restructuring Plan.  The Company's advertising sales
may  also  be  adversely affected by financial difficulties being experienced by
other  Internet  and e-commence companies that may result in reduced advertising
expenditures  by such companies.  In connection with the Restructuring Plan, the
Company  has  discontinued  Garden  Escape  Magazine.

MARKETING  AND  PROMOTION

     Marketing  and  Promotion  Strategy.  The Company's marketing and promotion
strategy  is  designed  to:

-     maximize  repeat  purchases;

-     build  strong  customer  loyalty;

-     increase  consumer  traffic  to  the  garden.com  Web  site;

-     add  new  customers;  and

-     develop  incremental  revenue  opportunities.

     Marketing  and  Promotion  Channels.  In  order  to implement the Company's
marketing  and  promotion  strategy, the Company has employed multiple channels,
including:

-     Branded Catalogs and Other Direct Marketing.  The Company is conducting an
      ongoing direct mail campaign that distributes a variety of direct response
      pieces,  including  seasonal,  branded  catalogs  and commerce and content
      based  e-mails  listing  upcoming features and promotions on the Company's
      Web  site.  The  Company sends mailings to selected members, customers and
      third  party  lists.

                                        8
<PAGE>
-     Customer  Retention  Efforts. The  Company's customer retention efforts
      include  its  one  year, 110% guarantee on all products; Garden Minder;
      Bloom  Times,  a monthly e-mail newsletter distributed to the Company's
      entire membership featuring products, promotions, upcoming features and
      chat  events;  targeted e-mail promotions, such as the first time buyer
      program,  occasional  sales  and  holiday  promotions;  and  Shoppers'
      Preview, a service that sends customized e-mails about new products and
      promotions,  tailored  to  specific customer segments identified in the
      customer  database.

-     Affiliate Program.  The Company's affiliate initiative, which was launched
      in  October  1999,  currently  has  over  23,000  affiliate  members.  The
      affiliate  program  is  supported  by a link on the Web site, where third-
      party  Web  sites  can  register  to  sell  garden.com products on a sales
      commission  basis.

-     Other  Marketing  and  Promotion  Channels.  The  Company has historically
      engaged  in  multiple  programs  of  print, radio, television and Internet
      advertising  to access potential customers. The Company expects that these
      programs will represent a less significant percentage of overall marketing
      and  promotion  spending  in  future  periods.

     Consistent with the reduction in expenses contemplated by the Restructuring
Plan  and  the  Company's limited cash, cash equivalent and investment balances,
the Company expects to spend fewer absolute dollars on marketing and promotional
efforts  for  the year ending June 30, 2001 than in the prior fiscal year.  As a
result,  the Company may not be able to successfully implement its marketing and
promotion  strategy,  which  would  have  an  adverse  effect  on  the Company's
business,  operating  results  and  financial  condition.

SUPPLY  MANAGEMENT

     As  of  June 30, 2000, the Company had over 70 supplier relationships.  The
Company  uses  these  relationships  and  its  TRELLIS  technology to "virtually
integrate"  the gardening supply chain to provide a broader product selection to
its customers than the Company believes is currently available through any other
gardening  retail  channel.  To  address  the  highly  fragmented  supply  base,
geographically  dispersed  suppliers  and  the  perishability  of  live planting
material,  the  Company  has assembled a virtual warehouse for its gardening and
gardening-related  products.

     The  Company's  suppliers benefit from its unique marketing channel without
dedicating  resources  to  build  an  online presence.  As of June 30, 2000, the
Company  had strategic mutually exclusive or semi-exclusive online relationships
with approximately 25 of its suppliers.  Under these relationships, the supplier
serves  as  the  Company's exclusive provider of a specific product line and the
Company  in turn acts as either the exclusive online outlet, or one of a limited
number  of  online  outlets,  for  the  respective suppliers' products.  For the
fiscal year ended June 30, 2000, shipments from these 25 suppliers accounted for
greater  than 65% of the Company's total product revenue.  However, in the event
that  its  demand unexpectedly exceeds the quantities its suppliers can provide,
the  Company has the right to establish relationships with alternative suppliers
that  the Company believes can satisfy its demand on reasonable terms.  Finally,
the  Company  negotiates  pricing  with  suppliers  based  upon  the  supplier's
wholesale  price  at  the  beginning  of  each  shipping  season.


                                        9
<PAGE>
     For  the fiscal year ended June 30, 2000, one external supplier, Milaeger's
Gardens,  accounted  for  more  than  12%  of  the  Company's  revenue.

     To  ensure  that  the  Company's  automated supply network is efficient and
scaleable,  the  Company  uses  its  TRELLIS  technology to enable the efficient
exchange  of  information  with  the  Company's  suppliers.  Over 95% of product
shipments  are  now  processed through the Company's automated supply network as
orders  are  placed  online, automatically downloaded to the Company's suppliers
for  fulfillment  and  directly  shipped  to the Company's customers via Federal
Express.  By  avoiding  the  expense  and  overhead  of  traditional  multi-tier
distribution models that focus on centralized distribution, the Company believes
it  has a competitive advantage over traditional gardening retailers.  While the
majority  of  the  Company's  customer  orders  are  directly  shipped  from its
suppliers,  the  Company  maintains an inventory of specialty gifts, promotional
items  and  some  high  volume  products  in  its  Austin,  Texas  warehouse.

     The  Company  leverages information systems capabilities of Federal Express
to  link  Garden.com  with  its  suppliers  and  customers.  In conjunction with
Federal  Express, the Company developed the TRELLIS shipping module to virtually
integrate  its  supply  chain.  This system provides significant efficiencies by
automating  the  process for updating order status and offers the reliability of
Federal  Express delivery.  The Company's order process and the respective roles
of  its  suppliers  and  Federal  Express  can  be  summarized  as  follows:

     1.     A  customer  visits  the  garden.com Web site, browses for products,
selects  items  for  purchase  and  completes the order online or by calling the
Company's  Customer  Solutions  800  telephone  number.  A customer may purchase
several  items  on the same order, and these items may ship directly from one or
more  of  the  Company's  suppliers.

     2.     The  customer  order  automatically  is  recorded  in  TRELLIS.

     3.     After  the  order  is  recorded,  the  Company  routes  it  to  the
appropriate  supplier  or  suppliers  for processing via TRELLIS.  Suppliers can
access  the  Internet, enter a special supplier area of the garden.com Web site,
view  all  the orders that contain one of their products and print packing slips
to  prepare  the  order.

     4.     The  supplier prepares the order for shipment by selecting the items
specified on the packing slip from its warehouse or growing field and by packing
the  items.

     5.     The  supplier  then  downloads a Federal Express shipping label from
TRELLIS  and  places  the  label  on the exterior of the box.  When the supplier
requests  a  label for an order, the Company's system also automatically updates
that customer's order record with the Federal Express tracking number.  From the
time  the order is placed until it is delivered to the customer's location, both
the  Company's  Customer  Solutions  representatives  and the customer can track
order  status  and  package  location during shipment through the garden.com Web
site.

     6.     Federal  Express  picks  up all of the processed orders and delivers
the  orders  directly  to  the  location specified by the customer in its online
order.


                                       10
<PAGE>
     7.     The  supplier  then uses TRELLIS to print a summary of all the items
processed  that  day for the Company and uses the summary to invoice the Company
on  a  weekly  or  monthly  basis.

     8.     Federal  Express  bills  the  Company  directly for all the shipping
costs  associated  with each order.  The Company's suppliers are not responsible
for  processing  shipping  invoices.

     As  a result of reduced expenses contemplated by the Restructuring Plan and
the Company's limited cash, cash equivalent and investment balances, the Company
may  experience  problems with its supplier base or with Federal Express.  These
vendors  may  be unwilling to continue to supply Garden.com with the products or
services  necessary  to successfully implement its strategy or may require other
terms and conditions adverse to the Company.  In addition the Company may not be
able to attract new suppliers or shipping carriers because of concerns regarding
the  Company's  ability  to  continue  to  operate  its  business.

OPERATIONS  AND  TECHNOLOGY

     The  Company's  Web  site  is run off multiple front-end Web servers and an
enterprise  database server.  The Company's servers are located at a third-party
network  operating  center  in  Austin,  Texas,  which  provides 24-hour systems
support  and  connectivity  via  high  speed  DS-3  and  higher  connections.
Additionally,  the Company maintains another set of servers at its headquarters,
to  promote redundancy from the primary servers.  These services and systems are
based  on a combination of the Company's own proprietary technologies, including
TRELLIS,  Landscape  Planner  and  Plant  Finder,  and  commercially  available,
licensed technologies.  As part of the Company's continuing effort to refine its
automated  supply  network, the Company uses its Austin, Texas warehouse to test
technological  upgrades  and  enhancements to the network.  The Company believes
that  its  Web  site  and  its proprietary supplier information system, TRELLIS,
provide  the  amount of customization, interactivity and performance required by
online  consumers  and  suppliers.  The  Company uses a set of applications for:

-     accepting  and  validating  customer  orders;

-     organizing,  placing  and  managing  orders  with  suppliers;

-     notifying  and  updating  customers  of  order  status;  and

-     managing  shipment  of  products  to  customers.

     The  Company  is  currently  engaged  in  a  project  to upgrade its system
architecture,  involving  the purchase from third parties of computer equipment,
software  and  consulting  services.  The  Company believes this investment will
assist  Garden.com  in  the  implementation  of  its  strategy  by expanding the
internal  system  capacity  and  functionality  needed to help support potential
growth in both product demand and visitors to the Web site.  As of June 30, 2000
the  Company  had  invested  approximately  $2.7  million related to this system
architecture  upgrade, and anticipates that it will make the remaining purchases
of  approximately  $5.7  million  by  December  31,  2000.


                                       11
<PAGE>
     The  market  in  which  the  Company  competes  is characterized by rapidly
changing  technology, evolving industry standards and changing customer demands.
Accordingly, the Company's future success will depend on its ability to adapt to
rapidly  changing  technologies,  to  adapt  its  services  to evolving industry
standards  and  to continually improve the performance, features and reliability
of  its  service  in  response  to competitive service and product offerings and
evolving  demands  of  the  marketplace.  The Company's failure to adapt to such
changes would have a negative impact on its operating results.  In addition, the
widespread  adoption  of  new  Internet,  networking  or  telecommunications
technologies  or  other  technological  changes  could  require  substantial
expenditures  by  the  Company to modify or adapt its services or infrastructure
which  could  have  a  negative  impact  on  its  operating  results.

     In connection with the Restructuring Plan, the Company announced the launch
of  its TRELLIS division.  It is anticipated that this division will concentrate
on  developing  additional  revenue  sources  for  the  Company through software
licensing  sales,  ongoing  software  support  fees,  and  consulting  revenues.

     During  the  first  quarter  of  the fiscal 2001, the Company also formed a
subsidiary  to pursue other software development opportunities.  This subsidiary
is  currently  proceeding  with  its  first  software application project, which
involves  developing computer software designed to enhance database performance.
The  Company owns 80% of this subsidiary and the Company issued restricted stock
for  the other 20% of this subsidiary to four executive officers of the Company.
The  software  applications  being developed by this subsidiary are in the early
development  stages,  and the Company can make no assurance that this subsidiary
will  be  able  to  develop  any  commercially  viable  software  applications,
particularly  in  view  of  the  Company's  limited  resources.

     As  a result of reduced expenses contemplated by the Restructuring Plan and
the Company's limited cash, cash equivalent and investment balances, the Company
may  experience  problems related to operations and technology development.  The
Company  may  be  unable  to  retain  or  attract  employees  with  the required
technological skills. In addition the Company may have insufficient resources to
invest  in the hardware or software products necessary to successfully implement
its  strategy.

COMPETITION

     Internet  and  online  commerce  generally, and the online retail gardening
market  specifically,  are  new, rapidly evolving and intensely competitive, and
the  Company  expects  such competition to intensify in the future.  The Company
currently  or potentially competes with a variety of other companies, including:

-     traditional  local  nurseries;

-     home  improvement  superstores,  such  as  Lowe's  and  Home  Depot;


                                       12
<PAGE>
-     established gardening mail-order catalogs, including Foster & Gallagher
      and  Smith  &  Hawken;

-     media  groups  with  existing,  well-defined brands in the home and garden
      market,  such  as  Martha  Stewart  Living;  and

-     multi-channel  online  retailers  seeking  to  diversify  their  product
      offerings,  such  as  Amazon.com,  1-800-FLOWERS  and  FTD.

     The  Company  believes that the following are principal competitive factors
in  its  market:

-     convenience;

-     quality;

-     selection;

-     customer  service;

-     information;  and

-     brand  recognition.

     Many  of  these  current and potential competitors can devote substantially
more  resources  to  Web  site  and  systems  development  than the Company.  In
addition,  larger,  well-established  and  well-financed  entities  may acquire,
invest in or form joint ventures with the Company's online competitors.  Some of
the  Company's competitors may be able to secure products from suppliers on more
favorable  terms,  fulfill  customer  orders  more  efficiently  and  adopt more
aggressive  pricing  or  inventory  availability  policies than the Company can.
Finally,  new  technologies  and the expansion of existing technologies, such as
price  comparison  programs  that select specific products from a variety of Web
sites,  may  direct  customers  to  other online gardening destinations.  If the
Company  faces  increased  competition,  its operating results may be negatively
impacted.

     The  Company  believes  that  its  TRELLIS  division  will  face  intense
competition  as  the  Company  attempts  to  commercialize  internally developed
technology.  Competitors  to  the  TRELLIS division could include Yantra, Optum,
AtlasCommerce  and Order Trust. The Company believes that its lack of experience
in  commercializing  technology  and  its  limited resources may put the TRELLIS
division  at  a  disadvantage  as  compared  to  its  competitors.


                                       13
<PAGE>
INTELLECTUAL  PROPERTY

     The  Company  regards  the  protection  of  its  copyrights, service marks,
trademarks,  trade dress and trade secrets as critical to its future success and
relies  on  a combination of copyright, trademark, service mark and trade secret
laws  and  contractual  restrictions  to  establish  and protect its proprietary
rights  in  products and services.  The Company has entered into confidentiality
and  invention  assignment  agreements  with  its employees and contractors, and
nondisclosure  agreements  with its suppliers and strategic partners in order to
limit  access to and disclosure of its proprietary information.  There can be no
assurance  that  these  contractual arrangements or the other steps taken by the
Company  to  protect  its intellectual property will prove sufficient to prevent
misappropriation  of  its  technology  or  to  deter  independent  third-party
development  of  similar  technologies.  The Company pursues the registration of
its  trademarks  and  service  marks in the U.S. and internationally.  Effective
trademark,  service  mark,  copyright  and  trade  secret  protection may not be
available  in  every  country in which the Company's services are made available
online.  The  Company  has licensed in the past, and expects that it may license
in  the  future,  certain  of  its  proprietary  rights,  such  as  trademark or
copyrighted  material,  to  third parties.  While the Company attempts to ensure
that  the  quality of its brand is maintained by such licensees, there can be no
assurance  that  such  licensees  will  not  take  actions that might materially
adversely  affect  the  value of the Company's proprietary rights or reputation,
which could have a material adverse effect on the Company's business, results of
operations  and  financial  condition.  The  Company  also  relies  on  certain
technologies that it licenses from third parties, including the suppliers of the
operating  systems  and  financial and reporting system for its business.  There
can  be no assurance that these third-party technology licenses will continue to
be  available to the Company on commercially reasonable terms.  The loss of such
technology  could  require  the Company to obtain substitute technology of lower
quality  or  performance  standards  or  at greater cost, which could negatively
impact  the  Company's  business, results of operations and financial condition.

     To  date,  the Company has not been notified that its technologies infringe
the  proprietary  rights of third parties.  There can be no assurance that third
parties will not claim infringement by the Company with respect to past, current
or  future  technologies.  The  Company expects that participants in its markets
will  be  increasingly  subject to infringement claims as the number of services
and  competitors  in  the  Company's  industry  segment  grows.  Any such claim,
whether  meritorious  or  not,  could  be  time-consuming,  result  in  costly
litigation,  cause  service  upgrade delays or require the Company to enter into
royalty or licensing agreements.  Such royalty or licensing agreements might not
be  available  on  terms  acceptable to the Company or at all.  As a result, any
such  claim  could  have  a material adverse effect upon the Company's business,
results  of  operations  and  financial  condition.

GOVERNMENT  REGULATION

     The  Company  is  not  currently  subject to direct federal, state or local
regulation,  and  laws or regulations applicable to access to or commerce on the
Internet,  other  than regulations applicable to businesses generally.  However,
due  to  the  increasing  popularity  and  use  of the Internet and other online
services,  it  is  possible that a number of laws and regulations may be adopted
with  respect  to  the Internet or other online services covering issues such as
user  privacy,  freedom  of expression, pricing, content and quality of products
and  services,  taxation,  advertising,

                                       14
<PAGE>
intellectual  property  rights  and  information  security.  The  nature of such
legislation and the manner in which it may be interpreted and enforced cannot be
fully  determined  and,  therefore,  such  legislation could subject the Company
and/or its customers to potential liability, which in turn could have an adverse
effect on the Company's business, results of operations and financial condition.
The  adoption  of  any  such laws or regulations might also decrease the rate of
growth  of  Internet  use,  which  in  turn  could  decrease  the demand for the
Company's service or increase the cost of doing business or in some other manner
have  a material adverse effect on the Company's business, results of operations
and financial condition.  In addition, applicability to the Internet of existing
laws  governing  issues  such  as  property  ownership,  copyrights  and  other
intellectual property issues, taxation, libel, obscenity and personal privacy is
uncertain.  The  vast  majority of such laws were adopted prior to the advent of
the  Internet  and  related technologies and, as a result, do not contemplate or
address  the  unique  issues  of  the  Internet  and  related  technologies.

     Several  states have also proposed legislation that would limit the uses of
personal  user  information  gathered  online  or  require  online  services  to
establish  privacy  policies.  The  Federal  Trade Commission has also initiated
action  against  at  least  one  online  service  regarding  the manner in which
information  is  collected from users and provided to third parties.  Changes to
existing  laws  or  the  passage  of  new laws intended to address these issues,
including  some  recently  proposed  changes,  could  create  uncertainty in the
marketplace  that could reduce demand for the Company's services or increase the
cost  of  doing  business  as  a result of litigation costs or increased service
delivery  costs, or could in some other manner have a material adverse effect on
the  Company's  business,  results  of  operations  and financial condition.  In
addition,  because  the  Company's services are accessible throughout the United
States, other jurisdictions may claim that the Company is required to qualify to
do  business  as  a  foreign  corporation in a particular state.  The Company is
qualified to do business in California, Iowa, Michigan and Texas and its failure
to qualify as a foreign corporation in a jurisdiction where it is required to do
so  could  subject the Company to taxes and penalties for the failure to qualify
and  could  result  in its inability to enforce contracts in such jurisdictions.
Any  such  new  legislation  or  regulation,  or  the  application  of  laws  or
regulations  from  jurisdictions  whose  laws  do  not  currently  apply  to the
Company's  business,  could  have  a  material  adverse  effect on the Company's
business,  results  of  operations  and  financial  condition.

     In  addition to regulations applicable to businesses generally, the Company
is  regulated  by federal, state and local governmental agencies with respect to
the  shipment  of  plants and other live goods, fertilizers and pesticides.  For
example, the California Department of Food and Agricultural restricts the import
of  plants  into  California  from  those  states  or  regions  which  may  have
undesirable diseases, parasites or insects.  The Company currently seeks to rely
upon  its  suppliers to meet the various regulatory and other legal requirements
applicable  to the Company's business.  However, the Company is unable to verify
that  they  have in the past, or will in the future, always do so, or that their
actions are adequate or sufficient to satisfy all governmental requirements that
may  be  applicable  to  these  sales.  The Company would be fined or exposed to
civil  or  criminal  liability, and the Company could receive potential negative
publicity,  if these requirements have not been fully met by its suppliers or by
the  Company  directly.


                                       15
<PAGE>
     There  are,  to  the  Company's  knowledge,  currently  no  investigations,
inquiries,  citations,  fines,  or  allegations  of  violations or noncompliance
pending  by  government agencies or by third parties against the Company.  It is
possible  that  there  may  be investigations or allegations in the future.  The
risk  that  any  noncompliance  may  be  discovered  in  the future is currently
unknown.  Although  any potential impact on the Company for noncompliance cannot
currently  be  established,  it  could  result  in  civil or criminal penalties,
including  monetary  fines  and  injunctions,  for  noncompliance  and  negative
publicity,  and  have  a  material  adverse  impact  on  the Company's business,
revenues,  results  of  operations  and  financial  conditions.

EMPLOYEES

     As  of  June  30,  2000,  the  Company  employed  267  full-time equivalent
individuals.  Pursuant  to  the  Restructuring  Plan,  the  Company  reduced its
workforce  on  September  28,  2000  by  93  employees.  The  Company's  future
performance  depends  in  significant part upon the continued service of its key
technical,  sales  and senior management personnel.  The loss of the services of
one or more of the Company's key employees could negatively impact the Company's
business,  operating  results  and financial condition.  With potential employee
uncertainty  resulting  from  the  Restructuring  Plan and the Company's limited
resources, there can be no assurance that the Company will be able to retain and
motivate  its  employees.  The  Company has adopted a severance policy for those
employees remaining after the implementation of the Restructuring Plan.  None of
the  Company's  employees  is  represented  by  a  labor  union.

ITEM  2.  PROPERTIES

     The  Company's  headquarters  are  located  in  Austin, Texas at 3301 Steck
Avenue, Austin, Texas 78757.  The Company also maintain an office in Des Moines,
Iowa,  where  its  publishing  office is located and where the Company maintains
five  test  gardens, where products are grown, tested and evaluated for the main
product  line.   The Company leases all of its facilities, with the Austin lease
comprising  approximately  32,500  square feet of office and warehouse space and
the  Iowa  lease  comprising  approximately  1,500  square feet of office space.

ITEM  3.  LEGAL  PROCEEDINGS

     From  time  to  time, the Company may be involved in litigation relating to
claims  arising  out  of its operations in the normal course of business.  As of
the  date  of  this  report, the Company is not a party to any legal proceeding.

ITEM  4.     SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

     No  matters  were submitted to a vote of security holders during the fourth
quarter  of  the  fiscal  year  ended  June  30,  2000.


                                       16
<PAGE>
                                     PART II
                                     -------

ITEM  5.     MARKET  FOR  REGISTRANT'S  COMMON  EQUITY  AND  RELATED STOCKHOLDER
MATTERS

     The  Common  Stock is traded on the Nasdaq National Market under the symbol
"GDEN".  The following table sets forth the high and low closing sale prices for
the  Common  Stock  as  reported  by  the Nasdaq National Market for the periods
indicated.
<TABLE>
<CAPTION>

YEAR ENDED JUNE 30, 2000

QUARTER                                         HIGH      LOW
---------------------------------------------  -------  -------
<S>                                            <C>      <C>
First (September 16, 1999-September 30, 1999)  $20.813  $14.969
Second. . . . . . . . . . . . . . . . . . . .  $19.000  $ 8.500
Third . . . . . . . . . . . . . . . . . . . .  $10.500  $ 6.750
Fourth. . . . . . . . . . . . . . . . . . . .  $ 8.500  $ 2.375
</TABLE>

     At  June 30, 2000, there were approximately 194 holders of record of Common
Stock.

     The  Company  has  not  paid  any  cash dividends on its Common Stock.  The
Company intends to retain any earnings for use in the operation and expansion of
its  business  and,  therefore, does not anticipate paying any cash dividends in
the  foreseeable  future.

ITEM  6.     SELECTED  FINANCIAL  DATA

     The  statement of operations data for the fiscal years ended June 30, 2000,
1999,  1998 and 1997 and for the period from October 2, 1995 (inception) to June
30,  1996  and  the balance sheet data as of June 30, 2000, 1999, 1998, 1997 and
1996  are derived from the Company's financial statements that have been audited
by  Ernst  &  Young  LLP,  independent  auditors.


                                       17
<PAGE>
<TABLE>
<CAPTION>

                                                   Fiscal Year Ended
                                                       June  30,                       Period from
                                 ---------------------------------------------------  October 2, 1995
                                                                                      (inception) to
                                     2000         1999         1998         1997       June 30, 1996
                                 ------------  -----------  -----------  -----------  ---------------
                                         (in  thousands,  except  share  and  per  share  data)
<S>                              <C>           <C>          <C>          <C>          <C>
Statement of Operations Data:
  Revenues:
    Products. . . . . . . . . .  $    13,564   $    4,952   $    1,283   $      308   $            8
    Advertising . . . . . . . .        1,938          442           56            8               --
                                 ------------  -----------  -----------  -----------  ---------------
 Total revenues . . . . . . . .       15,502        5,394        1,339          316                8
                                 ------------  -----------  -----------  -----------  ---------------

Cost of revenues:
  Products. . . . . . . . . . .       11,416        4,466        1,086          242                5
  Advertising . . . . . . . . .          205           74           22            4               --
                                 ------------  -----------  -----------  -----------  ---------------
 Total cost of revenues . . . .       11,621        4,540        1,108          246                5
                                 ------------  -----------  -----------  -----------  ---------------

Gross Profit. . . . . . . . . .        3,881          854          231           70                3
Operating expenses:
  Marketing and sales . . . . .       26,654       13,305        2,411          927              189
  Technology, content and
   product development. . . . .        6,918        3,167        1,188          858              161
  General and administrative. .        7,052        2,941        1,218          668              311
  Depreciation and amortization        2,107          610          219           97               29
  Amortization of deferred
   compensation . . . . . . . .        1,136          674           73           --               --
  Restructuring and other
   activities . . . . . . . . .          888           --           --           --               --
                                 ------------  -----------  -----------  -----------  ---------------
     Total operating expenses .       44,755       20,697        5,109        2,550              690
                                 ------------  -----------  -----------  -----------  ---------------

Operating loss. . . . . . . . .      (40,874)     (19,843)      (4,878)      (2,480)            (687)
Other income and expense. . . .        2,151          784          194           40               22
                                 ------------  -----------  -----------  -----------  ---------------

Net loss. . . . . . . . . . . .  $   (38,723)  $  (19,059)  $   (4,684)  $   (2,440)  $         (665)
                                 ============  ===========  ===========  ===========  ===============

Beneficial conversion
  feature and insubstance
  dividend. . . . . . . . . . .           --       (2,700)          --           --               --
                                 ------------  -----------  -----------  -----------  ---------------

Net loss application to
  common stockholders . . . . .  $   (38,723)  $  (21,759)  $   (4,684)  $   (2,440)  $         (665)
                                 ============  ===========  ===========  ===========  ===============

Basic net loss per share. . . .  $     (2.74)  $   (20.48)  $    (4.68)  $    (2.44)  $        (1.19)
                                 ============  ===========  ===========  ===========  ===============

Shares used to compute
  basic net loss per share. . .   14,149,167    1,062,696    1,000,820      999,993          558,908

Balance Sheet Data:
  Cash and cash equivalents . .  $     9,047   $   15,340   $   19,042   $    4,948   $          114
  Working capital . . . . . . .       25,023       18,323       18,308        4,568              (10)
  Total assets. . . . . . . . .       42,495       25,222       20,489        5,423              323
  Total liabilities and
   deferred revenue . . . . . .        7,546        3,343        1,473          586              251
  Total redeemable
   convertible preferred
   stock, warrants, and
   stockholders' deficit. . . .       34,949       21,879       19,015        4,837               92
</TABLE>

                                       18
<PAGE>
ITEM  7.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF FINANCIAL CONDITION AND
RESULTS  OF  OPERATIONS

     The  following discussion and analysis of the Company's financial condition
and  results  of  operations  should  be  read in conjunction with the Financial
Statements  and  the  related  notes.  This  discussion contains forward-looking
statements based upon current expectations that involve risks and uncertainties,
such  as  the  Company's  plans,  objectives,  expectations and intentions.  The
Company's  actual  results  and  the  timing  of  certain  events  could  differ
materially  from  those  anticipated  in  these  forward-looking statements as a
result  of certain factors, including those set forth in "Item 1 - Business" and
elsewhere  in  this  report.  See  "-  Additional Factors that May Affect Future
Results."

OVERVIEW

     The  Company was formed in December 1995 as Garden Escape, Inc. as a result
of a merger with The Asbury Group, Inc., a Texas company formed in October 1995.
The Company began offering products for sale on its Web site in March 1996.  For
the  period  from the Company's inception on October 2, 1995 through March 1996,
the  Company  had  no  sales  and  its operating activities related primarily to
developing  its  Web  site and computer infrastructure and establishing supplier
relationships.  Since  launching  its  Web site, the Company has continued these
operating  activities and has also focused on building sales momentum, extending
its product offerings, establishing supplier and vendor relationships, promoting
its brand and establishing distribution and Customer Solutions operations.  As a
result,  the  Company's  operating  expenses  have  increased significantly.  In
February  1999,  the  Company  changed  its  name  to  Garden.com,  Inc.

     The  Company derives its revenues primarily from product sales and shipping
charges.  For  approximately  80%  of  the Company's product revenues, customers
place  orders  on  the  Company's  Web  site  which  orders  are  routed  to the
appropriate  third-party  supplier.  The  Company  takes title to all goods and,
accordingly,  has  the  risks  and  rewards of ownership for each shipment.  The
remaining  20%  of the Company's product revenues are for products purchased and
inventoried  by  the Company and shipped to customers when ordered.  The Company
buys  products  from  the  suppliers  at  a  wholesale  price and then sells the
products  to  the  customer at a retail price.  The revenues the Company records
reflect  the  sales  price  of  the  products  collected from the customer.  The
revenues  generated from shipping charges to the Company's customers do not have
a  direct  correlation  to  the  costs that the Company pays Federal Express for
shipping  the  products.  Typically, the Company charges the customer a shipping
amount  equal  to  the  greater of $4.50 and a variable percentage from 10 to 18
percent for shipping based on the total purchase amount.  Revenues received from
shipping  charges  are  recognized  when the related products for that order are
shipped  to  the  customer.  Seasonal  factors  typically  influence  product
availability and the timing of product shipments, which may affect the period of
revenue  recognition  and,  therefore,  may  influence  the  Company's quarterly
revenues and product margins.  For instance, the Company expects its revenues to
be  relatively  higher  in  its  fourth fiscal quarter, which coincides with the
spring  gardening  season,  and  relatively  lower  in its first fiscal quarter,
reflecting  decreasing  consumer  demand  for  garden  products  during the late
summer.

                                       19
<PAGE>
addition,  as  is  typical  for  gardening  retailers, the Company's product mix
generally varies by season.  Due to this variation in product mix offered during
the  year, the Company's gross margin fluctuates on a quarterly basis reflecting
the  sale of higher margin products during the holiday season, such as gifts and
decorating  items,  and  the  sale  of  lower  margin products during the spring
season,  such  as  live  plants.

     The Company also has generated revenues through advertising on its Web site
or in its print publications, including Garden Escape Magazine which the Company
discontinued  during the first quarter of fiscal 2001.  Approximately 95% of the
Company's  advertising  revenues  represent  transactions  in  which the Company
recognizes  a short-term receivable that typically is converted into cash within
60  to  90 days.  The remaining percentage of the Company's advertising revenues
consists  of  barter transactions in which the Company receives advertising with
companies in exchange for offering those companies guaranteed impressions on its
Web  site.  Advertising  revenues  are  derived  principally  from  short-term
advertising contracts in which the Company typically guarantees a minimum number
of  impressions  to  be delivered to users over a specified period of time for a
fixed  fee.  Advertising  revenues are recognized ratably in the period in which
the  advertisement is displayed.  Because advertising revenues are less seasonal
than  product  revenues,  the  higher  gross margins associated with advertising
revenue  may  have a more pronounced effect on the total gross margin in periods
when  product  sales  are  lower.

     On  September  28,  2000, the Company announced its Restructuring Plan with
the  intent  of  lowering ongoing operating expenses and reducing future capital
requirements.  It  is expected that the Restructuring Plan will cost the Company
between  $2.5 million and $2.8 million.  Pursuant to the Restructuring Plan, the
Company  reduced  its total workforce on September 28, 2000 by 93 employees.  In
addition,  the  Company  terminated  or  materially  amended  multiple marketing
initiatives,  including  the  Company's  relationships with iVillage, Excite and
PRIMEDIA,  resulting  in  both write-offs of prepaid assets and cash payments to
third  parties  to  discontinue  certain  contractual  obligations.

     In connection with the Restructuring Plan, the Company announced the launch
of  its TRELLIS division.  It is anticipated that this division will concentrate
on  developing  additional  revenue  sources  for  the  Company through software
licensing  sales,  ongoing  software  support  fees  and  consulting  revenues.
Additionally, the TRELLIS division will provide ongoing support to the Company's
Internet  and  branded  catalog  based sales efforts.  At formation, the TRELLIS
division  is  comprised  of  16  employees,  or  10%  of  the total workforce of
Garden.com  as  of  September  28,  2000.

     Simultaneous  with  its announcement of the Restructuring Plan, the Company
also  announced that it had engaged the investment bank of Robertson Stephens to
aid  the  Company in evaluating strategic alternatives and to assist the Company
with  ongoing  fund-raising  efforts.

     As  a result of reduced expenses contemplated by the Restructuring Plan and
the Company's limited cash, cash equivalent and investment balances, the Company
may  be  unable  to  successfully  implement  its  strategy, which would have an
adverse  effect  on  the  Company's  business,  operating  results and financial
condition.


                                       20
<PAGE>
RESULTS  OF  OPERATIONS

     The  following  table  sets  forth  the  Company's  results  of  operations
expressed as a percentage of total revenues.  The Company's historical operating
results  are  not  necessarily  indicative of the results for any future period.
<TABLE>
<CAPTION>

                                                            Percentage of Revenues
                                                       ---------------------------------
                                                               Fiscal Year Ended
                                                                    June  30,
                                                       ---------------------------------
                                                      2000             1999              1998
                                               ----------------  ----------------  ----------------
                                                  (in thousands, except share and per share data)
<S>                                            <C>               <C>               <C>
Revenues:
  Products                                                  87%               92%               96%
  Advertising . . . . . . . . . . . . . . . .               13                 8                 4
                                               ----------------  ----------------  ----------------
 Total revenues . . . . . . . . . . . . . . .              100               100               100
                                               ----------------  ----------------  ----------------

Cost of revenues:
  Products. . . . . . . . . . . . . . . . . .               74                83                81
  Advertising . . . . . . . . . . . . . . . .                1                 1                 2
                                               ----------------  ----------------  ----------------
 Total cost of revenues . . . . . . . . . . .               75                84                83
                                               ----------------  ----------------  ----------------

Gross profit. . . . . . . . . . . . . . . . .               25                16                17

Operating expenses:
  Marketing and sales . . . . . . . . . . . .              172               247               180
  Technology, content and product development               45                59                89
  General and administrative. . . . . . . . .               45                55                91
  Depreciation and amortization . . . . . . .               14                11                16
  Amortization of deferred compensation . . .                7                12                 6
  Restructuring and other activities     .. .                6                --                --

 Total operating expenses . . . . . . . . . .              289               384               382
                                               ----------------  ----------------  ----------------

Operating loss. . . . . . . . . . . . . . . .             (264)             (368)             (365)
Other income and expense. . . . . . . . . . .               14                15                15
                                               ----------------  ----------------  ----------------

Net loss. . . . . . . . . . . . . . . . . . .            (250)%            (353)%            (350)%
                                               ================  ================  ================
</TABLE>

                                       21
<PAGE>
COMPARISON  OF  FISCAL  YEARS  ENDED  JUNE  30,  2000  AND  JUNE  30,  1999

REVENUES

     Products.  Product  revenues  consist  of  product  sales  to customers and
charges  to  customers  for  shipping.  Revenues are recorded net of promotional
discounts and coupons.  Product returns are recorded as a reduction of revenues.
Product  revenues increased 174% to $13.6 million, or 87% of total revenues, for
the fiscal year ended June 30, 2000 from $5.0 million, or 92% of total revenues,
for  the  fiscal year ended June 30, 1999.  Product revenues increased primarily
as a result of the 180% growth in the Company's customer base, which the Company
believes  was  primarily  influenced by increased marketing activities, expanded
product  offerings  and  enhancements  to  the  features and functionally of the
garden.com  Web  site.

     Advertising.  Advertising  revenues  increased 338% to $1.9 million, or 13%
of  total revenues, for the fiscal year ended June 30, 2000 from $442,000, or 8%
of  total  revenues,  for  the  fiscal  year  ended  June 30, 1999.  Advertising
revenues  increased  primarily due to the focus of an internal advertising sales
department established in February 1999, and a 76% increase in page views on the
Web  sites  to  170.4  million for the fiscal year ended June 30, 2000 from 96.9
million  for  the  fiscal  year  ended  June  30,  1999.

GROSS  PROFIT

     Gross profit consists of total revenues minus cost of total revenues.  Cost
of  total revenues consists primarily of the cost of products sold to customers,
shipping and handling costs for product sales, and advertising sales commissions
paid  both  to  a  third  party advertising agency and to the Company's internal
advertising  sales  department.  Gross  profit increased to $3.9 million for the
fiscal year ended June 30, 2000 from $854,000 for the fiscal year ended June 30,
1999.  Gross margin increased to 25% of total revenues for the fiscal year ended
June  30,  2000  from  16%  of total revenues for the fiscal year ended June 30,
1999.  The  increase  in  gross profit in absolute dollars is due in part to the
Company's  overall  increased total revenues.  Gross margin percentage increased
primarily  due  to  an  increase  in higher margin advertising revenues, product
management negotiating with suppliers that raised contractual gross margins, and
the elimination of a one-time promotional activity, which totaled $79,000 in the
fiscal  year  ended June 30, 1999.  The Company may at times use discounting and
other promotional activities to promote customer purchases that would negatively
affect  gross  margins.

OPERATING  EXPENSES

     Marketing  and  Sales.  Marketing  and  sales expenses consist primarily of
advertising  and  promotional  expenditures,  payroll  and  related expenses for
personnel  engaged  in  marketing,  Customer  Solutions,  advertising  sales and
distribution activities and distribution expenses.  Marketing and sales expenses
increased to $26.7 million, or 172% of total revenues, for the fiscal year ended
June 30, 2000 from $13.3 million, or 247% of total revenues, for the fiscal year
ended June 30, 1999.  Marketing and sales expenses increased in absolute dollars
primarily  due  to  an

                                       22
<PAGE>
increase  in  the  Company's  advertising  and  promotional  expenditures,  and
increases  in payroll costs associated with its marketing and Customer Solutions
departments.  Marketing  and sales expenses decreased as a percentage of revenue
due  to  the  significant  increase  in  total  revenues.

     Technology,  Content  and  Product  Development.  Technology,  content  and
product  development  expenses  consist  of  payroll  and  related  expenses for
personnel involved in creating and publishing content, product merchandising and
Web site development.  The Company's personnel involved in these efforts produce
gardening related stories, graphics and photographs that appear in the Company's
Web  site.  In  addition  personnel  involved in technology, content and product
development  support  the  Company's  Web  site  infrastructure  and  product
merchandising  efforts,  which  involve the management of supplier relationships
and  product  demand  planning.  Technology,  content  and  product  development
expenses  increased  to  $6.9  million, or 45% of total revenues, for the fiscal
year  ended  June  30, 2000 from $3.2 million, or 59% of total revenues, for the
fiscal  year  ended  June  30,  1999.  The  increase  in technology, content and
product development expenses in absolute dollars is primarily due to an increase
in  payroll  and  related  costs used for hiring additional personnel as well as
associated  costs  related  to  enhancing  the  products and features, editorial
content  and  functionality  of  the  Company's Web site.  As a percent of total
revenues,  technology, content and product development expenses decreased due to
the  increase  in  total  revenues  during  the  period.

     General and Administrative.  General and administrative expenses consist of
payroll and related expenses for general corporate functions, including supplier
operations  support,  finance,  facilities  expenses,  and professional services
expenses.  Supplier  operations  support  includes  costs  such  as  travel  and
computer  related  expenses  incurred  when  consulting  with  new  and existing
suppliers.  For  example,  the Company configures computer software and hardware
located  on  the  premises  of  its  suppliers to ensure consistent and reliable
shipping  performance from those suppliers.  General and administrative expenses
increased  to  $7.1 million, or 45% of revenues, for the fiscal year ended June
30,  2000  from $2.9 million, or 55% of revenues, for the fiscal year ended June
30,  1999.  The  increase  in  general  and  administrative expenses in absolute
dollars  is  primarily  due to an increase in payroll and related costs used for
hiring  additional personnel as well as associated expenses necessary to support
the growth of the Company's operations.  As a percent of total revenues, general
and  administrative  expenses  decreased  due  to the increase in total revenues
during  the  period.

     Depreciation  and Amortization.  Depreciation of property and equipment and
amortization  of  intangible  other  assets are based on the useful lives of the
assets  or  terms of the license agreements, generally three to seven years, and
is  computed  using  the  straight-line  method.  Depreciation  and amortization
expenses  increased  to  $2.1  million, or 14% of total revenues, for the fiscal
year ended June 30, 2000 from $610,000, or 11% of total revenues, for the fiscal
year ended June 30, 1999.  The increase in depreciation and amortization expense
is primarily due to the increase in property and equipment to support the growth
of  the  Company,  including computer equipment, software, database servers, and
build  out  of  new  office  space.


                                       23
<PAGE>
     Amortization  of  Deferred  Compensation.  Deferred  stock  compensation is
amortized  to  expense over the vesting periods of the applicable stock options.
These  amounts  represent  the  difference  between  the exercise price of stock
option  grants  and  the  deemed fair value of the Company's common stock at the
time of such grants.  Amortization of deferred compensation expense increased to
$1.1  million  for  the  fiscal  year  ended June 30, 2000 from $674,000 for the
fiscal  year ended June 30, 1999.  Amortization of deferred compensation expense
for  each  of  the  next  four  fiscal  years  is  expected  to  be  as follows:
<TABLE>
<CAPTION>

Year ended     Amount in thousands
-------------  --------------------
<S>            <C>

June 30, 2001  $                614
June 30, 2002                   348
June 30, 2003                   166
June 30, 2004                    40
</TABLE>

     Restructuring and other activities.  In June 2000, the Company's management
initiated  a  restructuring  effort  that  resulted  in  the Company incurring a
restructuring  charge  of  $888,000.  This  charge  includes asset write-offs on
discontinued  Company  initiatives,  including  prepaid  costs for a landscaping
product  test,  severance  related  to  an  internal  restructuring  and  a note
receivable  from  a  European  based  internet  gardening  company.

OTHER  INCOME  AND  EXPENSE

     Other  income  and  expense  consists  of  interest earned on cash and cash
equivalents and short-term investments offset by interest expense on borrowings.
Other  income  and  expense  increased to $2.1 million for the fiscal year ended
June  30, 2000 from $784,000 for the fiscal year ended June 30, 1999 due to nine
full  months  of interest income on the proceeds of the Company's initial public
offering.  Interest  expense  continues  to decline as the Company pays down its
debt.

COMPARISON  OF  FISCAL  YEARS  ENDED  JUNE  30,  1999  AND  JUNE  30,  1998

REVENUES

     Products.  Product revenues increased 286% to $5.0 million, or 92% of total
revenues,  for  the fiscal year ended June 30, 1999 from $1.3 million, or 96% of
total  revenues,  for  the  fiscal  year  ended June 30, 1998.  Product revenues
increased  primarily  as  a  result of the 293% growth in the Company's customer
base, which the Company believes was primarily influenced by increased marketing
activities,  expanded  product  offerings  and  enhancements to the features and
functionality  of  the  garden.com  Web  site.

     Advertising.  Advertising  revenues  increased  689%  to $442,000, or 8% of
total  revenues,  for the fiscal year ended June 30, 1999 from $56,000, or 4% of
total  revenues,  for the fiscal year ended June 30, 1998.  Advertising revenues
increased  primarily  due  to  a 163% increase in page views on the Web sites to
96.9  million  for the fiscal year ended June 30, 1999 from 36.9 million for the
fiscal  year  ended  June  30,  1998.


                                       24
<PAGE>
GROSS  PROFIT

     Gross  profit  consists  of  total  revenues  minus cost of total revenues.
Gross  profit increased to $854,000 for the fiscal year ended June 30, 1999 from
$231,000 for the fiscal year ended June 30, 1998.  Gross margin decreased to 16%
of  total  revenues  for  the  fiscal year ended June 30, 1999 from 17% of total
revenues  for  the  fiscal  year ended June 30, 1998 due primarily to a one-time
promotional  activity  in  the  latter  period  designed  to  attract first-time
customers,  which  was  partially  offset  by  an  increase  in  higher  margin
advertising revenues.  This one-time promotional activity decreased gross profit
by  $79,000  for  the  fiscal  year  ended  June  30,  1999.

OPERATING  EXPENSES

     Marketing  and  Sales.  Marketing  and  sales  expenses  increased to $13.3
million, or 247% of total revenues, for the fiscal year ended June 30, 1999 from
$2.4  million,  or  180%  of  total revenues, for the fiscal year ended June 30,
1998.  Marketing  and  sales  expenses  increased  primarily due to increases in
expenses  related  to  advertising to promote the Company's brand and to acquire
new  customers  as  well  as increases in payroll and related costs used to hire
additional  marketing,  sales,  and  Customer  Solutions  personnel.

     Technology,  Content  and  Product  Development.  Technology,  content  and
product  development  expenses  increased  to  $3.2  million,  or  59%  of total
revenues,  for  the fiscal year ended June 30, 1999 from $1.2 million, or 89% of
total  revenues,  for  the  fiscal  year  ended  June 30, 1998.  The increase in
technology,  content  and  product  development  expenses in absolute dollars is
primarily  due  to  an  increase  in  payroll  and related costs used for hiring
additional  personnel  as  well  as  associated  costs  related to enhancing the
products  and features, editorial content and functionality of the Company's Web
site.  As  a percent of total revenues, content and product development expenses
decreased  due  to  the  increase  in  total  revenues  during  the  period.

     General  and Administrative.  General and administrative expenses increased
to  $2.9  million,  or  55% of revenues, for the fiscal year ended June 30, 1999
from  $1.2 million, or 91% of revenues, for the fiscal year ended June 30, 1998.
The  increase  in  general  and  administrative  expenses in absolute dollars is
primarily  due  to  an  increase  in  payroll  and related costs used for hiring
additional  personnel  as  well  as associated expenses necessary to support the
growth of the Company's operations.  As a percent of total revenues, general and
administrative  expenses  decreased due to the increase in total revenues during
the  period.

     Depreciation  and  Amortization.  Depreciation  and  amortization  expenses
increased  to $610,000, or 11% of total revenues, for the fiscal year ended June
30, 1999 from $219,000, or 16% of total revenues, for the fiscal year ended June
30,  1998.  The  increase  in  depreciation and amortization expense in absolute
dollars  is  primarily  due to the increase in property and equipment to support
the  growth  of  the  Company,  including computer equipment, software, database
servers,  and  build  out  of  new  office  space.


                                       25
<PAGE>
     Amortization  of Deferred Compensation.  In the fiscal years ended June 30,
1999  and  1998,  the  Company  recorded  total  deferred  stock compensation of
$2,739,000  and $314,000, respectively, in connection with stock options granted
during  the  period.  Such  amounts resulted in expenses of $674,000 and $73,000
for  the  fiscal  years  ended  June  30,  1999  and  1998.

OTHER  INCOME  AND  EXPENSE

     Other  income increased to $784,000 for the fiscal year ended June 30, 1999
from  $193,000  for  the fiscal year ended June 30, 1998 as a result of interest
earned  on  the  net  proceeds from the sale of the Company's preferred stock in
June  1998,  April  1999  and  May  1999.

LIQUIDITY  AND  CAPITAL  RESOURCES

     Since  inception, the Company has financed its operations primarily through
private  placements  of  preferred  stock, its initial public offering and, to a
lesser  extent, from revenues generated by operations.  As of June 30, 2000, the
Company  had  approximately  $9.0 million in cash and cash equivalents and $18.6
million  in  short-term  investments.

     Net  cash  used  in operating activities increased to $32.8 million for the
fiscal  year  ended  June  30, 2000 from $18.5 million for the fiscal year ended
June  30,  1999.  The  increase  in net cash used in operating activities can be
substantially  attributed  to  the  increased  net  loss.

     Net  cash  used  in investing activities increased to $23.8 million for the
fiscal year ended June 30, 2000 from $6.3 million for the fiscal year ended June
30,  1999.  The  increase  in  net  cash  used  in investing activities resulted
primarily  from  the purchase of securities for investment purposes and from the
purchase  of  property  and  computer  equipment.  Cash available for investment
purposes increased substantially during the fiscal year ended June 30, 2000 as a
result  of  the  proceeds  from  the  issuance  of common stock in the Company's
initial  public  offering.

     Net  cash  provided  by financing activities increased to $50.3 million for
the fiscal year ended June 30, 2000 from $21.1 million for the fiscal year ended
June  30,  1999.  The  increase  in  net  cash  provided by financing activities
resulted  primarily  from  net proceeds from the issuance of common stock in the
Company's  initial  public  offering.

     At June 30, 2000, approximately $20,000 was outstanding under the Company's
line  of credit term note.  The facility bears interest at the bank's prime rate
plus  1%.  The  assets  purchased with the proceeds from the line of credit term
note  secure  the  borrowings under this line of credit term note.  These assets
consist  primarily  of  purchased  computer  equipment.

     The  Company  believes  that its current cash and marketable securities and
investments balances will be sufficient to meet its anticipated cash needs until
December  31,  2000.  Any  projections  of  future cash needs and cash flows are
subject  to  substantial uncertainty.  The Company's capital requirements depend
on  several  factors,  including:


                                       26
<PAGE>
-     the  effect of the Restructuring Plan on the Company's ability to continue
      to  expand  its  customer  base  and  increase  revenues;

-     the  rate  of  market  acceptance  of  the  Company's  online  solution;

-     the  Company's  level  of  expenditures  for  marketing  and  sales;

-     purchases  of  equipment  and  software;

-     the  cost  of  Web  site  upgrades;

-     costs  associated  with  the  staffing  and  development  of  the  TRELLIS
      division;  and

-     other  factors,  including  unforeseen  factors  and  developments.

     It  is  imperative that the Company complete a significant financing during
the  quarter ending December 31, 2000.  Although the Company has been attempting
to  raise additional equity financing since the quarter ended June 30, 2000, the
Company  has not been able to obtain financing on acceptable terms as of October
13, 2000.  The Company has retained the investment bank of Robertson Stephens to
aid  the  Company in evaluating strategic alternatives and to assist the Company
with  ongoing  fund-raising  efforts.

     If  additional  funds  are  raised through the sale of additional equity or
convertible  debt  securities,  the  Company's  stockholders  could  experience
additional  dilution.  Debt  financing,  if  available,  may involve restrictive
covenants that could restrict the Company's operations or finances.  The Company
may  also  issue  new  equity  securities with rights, preferences or privileges
senior  to  the  Common Stock.  There can be no assurance that financing will be
available  in  amounts  or  on  terms acceptable to the Company, if at all.  The
Company  will  need  additional financing during the quarter ending December 31,
2000  to  meet  its  future  capital  requirements  and  execute on its business
strategy.  If  the Company cannot raise funds on acceptable terms or complete an
alternative  strategic  transaction, the Company may not be able to continue its
operations,  develop or enhance its Web site, develop its TRELLIS division, grow
market  share,  take advantage of future opportunities or respond to competitive
pressures  or  unanticipated  requirements,  which  could  negatively impact the
Company's  business,  operating  results  and  financial  condition.

ADDITIONAL  FACTORS  MAY  AFFECT  FUTURE  RESULTS

     Some of the statements in "Item 7 - Management's Discussion and Analysis of
Financial  Condition  and  Results  of  Operations,"  "Item  1  -  Business" and
elsewhere  in  this  report  constitute  forward-looking  statements.  These
statements  involve  known  and  unknown risks, uncertainties, and other factors
that may cause the Company's actual results, levels of activity, performance, or
achievements  to  be  materially  different  from  any future results, levels of
activity,  performance,  or  achievements  expressed  or  implied  by  such
forward-looking  statements.  In  some  cases, forward-looking statements can be
identified  by  terminology  such  as "may," "will," "should," "expect," "plan,"
"anticipate," "believe," "estimate," "predict," "potential" or "continue" or the
negative  of  such  terms or other comparable terminology.  These statements are
only  predictions.  Actual

                                       27
<PAGE>
events or results may differ materially.  Although the Company believes that the
expectations  reflected  in  the  forward-looking statements are reasonable, the
Company  cannot  guarantee  future  results,  levels of activity, performance or
achievements.  Moreover,  neither  the  Company  nor  any  other  person assumes
responsibility  for  the  accuracy  and  completeness  of  such statements.  The
Company  is  under no duty to update any of the forward-looking statements after
the  date  of  this  report  to  conform  such  statements  to  actual  results.

     In  addition  to  the  factors  discussed  elsewhere  in  this  report, the
following  additional  factors  may  affect  the  Company's  future  results.

THE  COMPANY  WILL  NEED ADDITIONAL FINANCING DURING THE QUARTER ENDING DECEMBER
31,  2000  TO  MEET  ITS FUTURE CAPITAL REQUIREMENTS AND EXECUTE ON ITS BUSINESS
STRATEGY.   IF THE COMPANY CANNOT RAISE FUNDS ON ACCEPTABLE TERMS OR COMPLETE AN
ALTERNATIVE  STRATEGIC  TRANSACTION, THE COMPANY MAY NOT BE ABLE TO CONTINUE ITS
OPERATIONS,  DEVELOP OR ENHANCE ITS WEB SITE, DEVELOP ITS TRELLIS DIVISION, GROW
MARKET  SHARE,  TAKE ADVANTAGE OF FUTURE OPPORTUNITIES OR RESPOND TO COMPETITIVE
PRESSURES  OR  UNANTICIPATED  REQUIREMENTS.

     It  is  imperative that the Company complete a significant financing during
the  quarter ending December 31, 2000.  Although the Company has been attempting
to  raise additional equity financing since the quarter ended June 30, 2000, the
Company  has not been able to obtain financing on acceptable terms as of October
13,  2000.  The  Company  intends  to  continue  to seek to raise equity or debt
financing.  The  Company  also  has  retained  the  investment bank of Robertson
Stephens  to  aid the Company in evaluating strategic alternatives and to assist
the  Company  with ongoing fund-raising efforts.  No assurance can be given that
the  Company  will be able to obtain additional financing on favorable terms, if
at  all.  The  Company's  capital  requirements  depend  upon  several  factors,
including the effect of the Restructuring Plan, the rate of market acceptance of
the  Company's  products  and  services, the Company's level of expenditures for
marketing  and  sales,  the cost of Web site upgrades, costs associated with the
staffing  and  development  of  the  TRELLIS division and other factors.  If the
Company's capital requirements vary materially from those currently planned, the
Company  may  require  more  financing  during  fiscal  2001  than  currently
anticipated.  Further, if the Company issues equity securities, stockholders may
experience  additional  dilution  or  the new equity securities may have rights,
preferences  or  privileges senior to those of existing holders of common stock.
If the Company cannot raise funds on acceptable terms or complete an alternative
strategic  transaction,  the Company may not be able to continue its operations,
develop  or  enhance  its  Web  site,  develop its TRELLIS division, grow market
share,  take  advantage  of  future  opportunities  or  respond  to  competitive
pressures  or  unanticipated  requirements,  which  could  negatively impact the
Company's  business,  operating  results  and  financial  condition.

THE  COMPANY'S  BUSINESS  MAY  BE  ADVERSELY  AFFECTED BY REDUCTIONS IN EXPENSES
PURSUANT TO THE RESTRUCTURING PLAN AND BY THE COMPANY'S WELL-PUBLICIZED NEED FOR
ADDITIONAL  FINANCING.


                                       28
<PAGE>
     The  Company's  need to raise additional financing has been well-publicized
based  on public disclosures to stockholders and numerous news stories regarding
the  need for Internet companies to raise additional capital, some of which have
mentioned  Garden.com.  The  Company  also  announced  its Restructuring Plan on
September  28,  2000, with the intent of lowering ongoing operating expenses and
reducing  future  capital requirements.  Pursuant to the Restructuring Plan, the
Company  reduced  its  total  workforce  and  terminated  or  materially amended
multiple  marketing  initiatives,  including  the  Company's  relationships with
iVillage,  Excite  and  PRIMEDIA.  The  Company  expects  that  the  reduced
expenditures  contemplated  by  the Restructuring Plan and the Company's limited
cash,  cash  equivalent  and  investment  balances  may  create  a  number  of
difficulties  for  the  Company,  including:

-     difficulties  with the Company's supplier base,  Federal Express and other
      third-party  vendors  as  these  vendors  may  be unwilling to continue to
      supply  Garden.com  with  necessary products and services to implement the
      Company's  strategy  or  may  require prepayments or deposits to continue
      doing  business  with  the  Company;

-     challenges in employee retention and recruitment, particularly in light of
      a  very  strong market for high technology workers in Austin, Texas, where
      the  Company's  headquarters  are  located;

-     the  inability  to  fund  marketing  expenditures  which  may  impede  the
      development  of  the  Garden.com  brand and the attraction of users to the
      Company's  Web  site;

-     the  potential  that the Company may have insufficient resources to invest
      in  necessary  hardware  or  software;  and

-     challenges in launching the TRELLIS division as potential customers may be
      reluctant  to  purchase  software  and  support  services  in  the face of
      uncertainty  in  the  Company's  financial  condition.

     It  is  expected  that the Restructuring Plan will cost the Company between
$2.5  million and $2.8 million.  At this time, however, such amount is uncertain
and  may  ultimately  be  more  than  currently  anticipated.

     The  Company  is  actively  seeking  financing  to  stabilize its financial
position  in  order  to  permit  it  to address the factors identified above and
pursue  its  business  strategy.  If  the Company is unable to obtain additional
financing  or  complete  an  alternative strategic transaction, the Company will
probably  not  be  able  to  address  these  issues.

THE COMPANY HAS A HISTORY OF SIGNIFICANT LOSSES AND EXPECTS TO INCUR SUBSTANTIAL
NET  LOSSES  IN  THE  FUTURE. IF THE COMPANY DOES NOT ACHIEVE PROFITABILITY, ITS
FINANCIAL  CONDITION  AND  ITS  STOCK  PRICE  COULD  SUFFER.


                                       29
<PAGE>
     The  Company  incurred  net  losses  of  $4.7 million in fiscal 1998, $19.1
million  in  fiscal 1999 and $38.7 million in fiscal 2000.  As of June 30, 2000,
the  Company  has  incurred cumulative net losses of $68.6 million.  The Company
expects  to  experience  operating  losses  and  negative  cash  flow  for  the
foreseeable  future.  The  Company  does not have sufficient cash to continue to
sustain  these operating losses in fiscal 2001.   Even if the Company is able to
obtain  additional  financing  during  fiscal  2001  to allow it to continue its
operations, the Company still will need to generate significant revenues to fund
anticipated  development  and  marketing  costs  and  to  achieve  and  maintain
profitability.  The Company's inability to finance its growth, either internally
or  externally,  may  limit  its growth potential and its ability to execute its
business  strategy.   In  addition,  the  Company has received a report from its
independent  auditors  for  its  fiscal  year  ended June 30, 2000 containing an
explanatory  paragraph  that  describes  the uncertainty regarding the Company's
ability  to continue as a going concern due to the Company's historical negative
cash  flow  and because, as of the date they rendered their opinion, the Company
did  not  have  access  to  sufficient  committed  capital to meet its projected
operating  needs  for  at  least  the  next  12  months.

THE COMPANY HAS A LIMITED OPERATING HISTORY IN ITS CONSUMER BUSINESS AND EXPECTS
TO ENCOUNTER RISKS AND DIFFICULTIES FREQUENTLY FACED BY EARLY STAGE COMPANIES IN
RAPIDLY  EVOLVING  MARKETS.  THIS  SUBJECTS  THE  COMPANY'S  STOCKHOLDERS  TO
ADDITIONAL  RISKS  THAT  THE  COMPANY'S MARKET MAY NOT DEVELOP AS ANTICIPATED OR
THAT  THE  COMPANY  MAY  NOT  SUCCESSFULLY  EXECUTE  ITS  BUSINESS  STRATEGY.

     The  Company has a limited operating history on which to base an evaluation
of  its business and prospects.  The Company was formed in December 1995, and it
initiated  its  online  operations  and first recognized revenues in March 1996.
Accordingly,  the  Company's prospects must be considered in light of the risks,
expenses and difficulties frequently encountered by early stage companies in new
and rapidly evolving markets such as online commerce and technology.  Because of
the  Company's  limited operating history, it is difficult to assess whether the
Company will succeed at executing on its business strategy, managing growth, and
addressing  the  market  risks  that  it  faces  in a rapidly developing market.

     The  online  market for gardening and gardening-related products is new and
rapidly  developing.  As  is  typical  for  any  new, rapidly developing market,
demand  and  market acceptance for recently introduced products and services are
subject  to  a  high  level  of  uncertainty  and risk.  It is also difficult to
predict  the online gardening market's future growth rate.  The online gardening
market  may  fail  to  develop,  develop  more  slowly  than  expected or become
saturated with competitors, or the Company's products may not achieve or sustain
market acceptance.  To address these risks, the Company must maintain and expand
its customer base, implement and successfully execute its business and marketing
strategy,  continue  to  develop and upgrade the technology and systems that the
Company  uses  to  process customers' orders and payments, improve its Web site,
provide  superior  customer  service,  respond  to  competitive developments and
attract,  retain  and  motivate  qualified personnel.  The Company also plans to
focus  its  advertising  expenditures  to  a greater degree on seasonal, branded
catalogs  and  direct  mail.  The  Company has limited experience in catalog and
direct  mail  advertising  and  such  methods  may prove to be less effective in
expanding  the  Company's  customer  base  than the Company's previous marketing
strategy.  There  can  be  no  assurance  that the Company will be successful in
addressing  these  risks,  and  any failure by the Company to do so could have a
negative  impact  on  its  business,  operating results and financial condition.


                                       30
<PAGE>
THE  COMPANY  HAS  NO  OPERATING HISTORY OR EXPERIENCE IN ITS NEW TECHNOLOGY AND
SERVICES BUSINESS AND THE COMPANY EXPECTS THAT THIS LACK OF EXPERIENCE MAKES THE
PROSPECTS  FOR  THIS  BUSINESS  ESPECIALLY  DIFFICULT  TO  PREDICT.

     The  Company  launched  its  new  TRELLIS  division in September 2000.  The
Company  has  no  operating  history  or  experience in providing technology and
services  to businesses.  The Company can make no assurance that it will be able
to  commercialize TRELLIS and establish a successful revenue producing business.
The  Company  expects  that  it will face significant challenges in establishing
this  business,  including  the need for additional financing to launch this new
business,  intense  competition in this market, possible reluctance by potential
customers to purchase software and support services from the Company in the face
of  uncertainty  in  the Company's financial condition and the need to develop a
new  brand  by  the  Company.

THE  COMPANY'S  DEPENDENCE  ON THE HIGHLY SEASONAL GARDENING INDUSTRY WILL CAUSE
ITS  OPERATING  RESULTS  TO  VARY  FROM  QUARTER  TO  QUARTER.

     Seasonal factors typically influence product availability and the timing of
product  shipments  in  the  gardening  industry,  which may affect both product
demand  and  the  period  of  revenue  recognition  and,  in turn, influence the
Company's  quarterly  revenues  and  product margins.  For instance, the Company
expects its revenues to be relatively higher in its fourth fiscal quarter, which
coincides  with  the  spring gardening season, and relatively lower in its first
fiscal quarter, reflecting decreasing consumer demand for garden products during
the  late  summer.  In  addition,  as  is  typical  for gardening retailers, the
Company's  product  mix  generally  varies  by season.  Due to this variation in
product  mix offered during the year, the Company's gross margin fluctuates on a
quarterly basis reflecting the sale of higher margin products during the holiday
season,  such  as  gifts  and  decorating  items,  and  the sale of lower margin
products  during  the  spring  season,  such  as  live plants.  Furthermore, the
Company  anticipates  that  operating costs will typically increase in the third
quarter of its fiscal year as marketing expenses increase in anticipation of the
spring  planting  season.

     Due  to the Company's limited operating history, it is difficult to predict
the  seasonal  pattern  of the Company's future revenues and operating costs and
the  impact  of  such seasonality on the Company's future operating results.  If
they  become  more pronounced, seasonal revenue and cost patterns may strain the
Company's  personnel  and  fulfillment activities and could cause a shortfall in
revenues  as  compared  to  costs  in  a  given  period.

THE  COMPANY  EXPECTS  THE  MARKET  PRICE  OF ITS COMMON STOCK AND ITS QUARTERLY
OPERATING  RESULTS  TO FLUCTUATE.  IF THE COMPANY FAILS TO MEET THE EXPECTATIONS
OF  PUBLIC  MARKET  ANALYSTS  AND  INVESTORS,  THE MARKET PRICE OF THE COMPANY'S
COMMON  STOCK  COULD  DECLINE.

     The  Company  has  experienced  significant  fluctuations  in its quarterly
operating  results  due  to  a variety of factors, many of which are outside its
control.  The  Company has also experienced significant volatility in the market
price  of  its Common Stock.  The market price of the Company's common stock has
declined  from a 52-week closing high of $20.813 on September 21, 1999 to $0.625
on  October  9,  2000.  The  Company

                                       31
<PAGE>
believes  it  is  likely  that,  in  the  future,  fluctuations in its quarterly
operating  results  will  cause  its  results  to fall below the expectations of
securities  analysts and investors, which could cause the price of the Company's
common  stock to drop.  The Company believes that many of the other risk factors
listed  in this report may negatively affect its quarterly operating results and
contribute to fluctuations.  Further, the Company's quarterly gross margins also
may  be  impacted  by  a  number of different factors that are difficult for the
Company  to  anticipate  at  this stage in its business.  Likely causes of gross
margin  fluctuations  include  changes  in the mix of online product revenues as
compared  to  advertising  revenues,  the  mix  of  products sold and the mix of
revenues  derived from purchases originating from the Company's Web site and the
Web  sites  of  its  distribution  and  advertising  partners.

     The  Company's limited operating history and the rapidly evolving nature of
its  industry  make  forecasting  quarterly  operating  results  difficult.
Accordingly, the Company bases its expenses in large part on its operating plans
and future revenue projections.  Most of the Company's expenses are fixed in the
short  term,  and  the Company may not be able to quickly reduce spending if its
revenues  are  lower  than it projects.  Therefore, any significant shortfall in
revenues  would  likely  have  an  immediate,  negative  impact on the Company's
business,  operating  results  and  financial  condition.

THE COMPANY FACES SIGNIFICANT COMPETITION FROM ESTABLISHED TRADITIONAL GARDENING
RETAILERS,  MAIL  ORDER  CATALOGS,  ONLINE  RETAILERS  AND  OTHERS.

     The  Company  may  be  unable  to  compete successfully against current and
future  competitors,  and  competitive pressures could have a negative impact on
the  Company's  business,  operating  results  and  financial condition.  Online
commerce,  and  specifically  the  online  retail  gardening  market, is new and
rapidly evolving, and the Company expects competition to intensify in the future
as  companies  attempt to utilize the advantages of the Internet.  The Company's
competition  includes  existing  companies  that  have  built  or  are trying to
establish  an  online retail presence, as well as new entrants trying to build a
brand  online.  The  Company currently or potentially competes with a variety of
other  companies,  including:

-     local  nurseries  and  gardening  centers;

-     home  improvement  superstores,  such  as  Lowe's and Home Depot, and mass
      merchant  retailers,  such  as  Wal-Mart;

-     established  gardening  mail  order catalogs, including Foster & Gallagher
      and  Smith  &  Hawken;

-     media  groups  with  existing,  well-defined brands in the home and garden
      market,  such  as  Martha  Stewart  Living;  and

-     multi-channel  online  retailers  seeking  to  diversify  their  product
      offerings,  such  as  Amazon.com,  1-800-FLOWERS  and  FTD.


                                       32
<PAGE>
     The  Company  believes  that  its  TRELLIS  division  will  face  intense
competition  as  the  Company  attempts  to  commercialize  internally developed
technology.  Competitors  to  the  TRELLIS division could include Yantra, Optum,
AtlasCommerce  and Order Trust. The Company believes that its lack of experience
in  commercializing  technology  and  its  limited resources may put the TRELLIS
division  at  a  competitive  disadvantage  as  compared  to  its  competitors.

     The Company expects competition to increase as current competitors increase
the  sophistication of their offerings and as new participants enter the market.
Many  of  the  Company's current and potential competitors have longer operating
histories,  larger  customer  bases, greater brand recognition and significantly
greater financial, marketing and other resources than the Company does and could
enter  into  strategic or commercial relationships with larger, more established
and  well-financed  companies.  Due to their size and greater resources, many of
the  Company's  current and potential competitors may be able to secure services
and products from suppliers on more favorable terms, devote greater resources to
marketing  and  promotional campaigns and devote substantially more resources to
Web  site  and  systems  development  than  the  Company  does.  Their financial
strength  could  prevent the Company from increasing market share.  In addition,
the  development of new technologies and the expansion of existing technologies,
such  as  price comparison programs that select specific products from a variety
of  Web  sites,  may  increase  competitive pressures on the Company.  Increased
competition  may  result in reduced operating margins, as well as loss of market
share  and  brand  recognition.

THE  COMPANY  FACES  SIGNIFICANT CHALLENGES IN CONTINUING TO ATTRACT, RETAIN AND
MOTIVATE  HIGHLY  SKILLED  EMPLOYEES.

     The  Company's ability to execute its strategy and be successful depends on
its continuing ability to attract, retain and motivate highly skilled employees.
Competition  for  personnel  throughout  the  Internet industry is intense.  The
Company has faced particular challenges recently in light of its well publicized
liquidity  issues, its low stock price which has fallen below the exercise price
of  many  of the stock options granted to employees and a very competitive labor
market  for  high  technology  workers  in  Austin,  Texas,  where the Company's
headquarters  are  located.  Recently,  a  significant  number  of the Company's
employees  have  been terminated in cost cutting efforts or voluntarily departed
to  pursue  other  opportunities.  The  Company  may be unable to retain its key
employees  or  attract, assimilate or retain other highly qualified employees in
the  future.  If  the  Company  does not succeed in retaining and motivating its
current  personnel,  its  business  will  be  seriously  harmed.

THE  COMPANY'S BUSINESS RELIES ON ITS ABILITY TO MAINTAIN RELATIONSHIPS WITH ITS
SUPPLIERS  TO  OBTAIN SUFFICIENT QUANTITIES OF QUALITY MERCHANDISE ON ACCEPTABLE
COMMERCIAL  TERMS.  IF  THE COMPANY FAILS TO MAINTAIN ITS SUPPLIER RELATIONSHIPS
ON  ACCEPTABLE  TERMS,  ITS  SALES  AND  PROFITABILITY  COULD  SUFFER.

     Because  the  Company carries minimal inventory and relies largely on rapid
fulfillment from its suppliers, the Company's business would be seriously harmed
if  it  were  unable  to  develop and maintain relationships with suppliers that
allow  it  to  obtain sufficient quantities of quality merchandise on acceptable
commercial  terms.  The  Company's  contracts  or  arrangements  with

                                       33
<PAGE>
suppliers do not guarantee the availability of merchandise, establish guaranteed
prices  or  provide  for the continuation of particular pricing practices.  As a
result  of  reduced  expenses  contemplated  by  the  Restructuring Plan and the
Company's limited cash, cash equivalent and investment balances, the Company may
experience  problems  with  its  supplier  base.  The Company's suppliers may be
unwilling  to  continue  to  supply  Garden.com  with  the  products or services
necessary  to successfully implement its strategy or may require other terms and
conditions  adverse  to the Company.  In addition the Company may not be able to
attract  new  suppliers  because  of concerns regarding the Company's ability to
continue  to operate its business.  If the Company cannot supply its products to
consumers  at  acceptable prices, the Company may lose sales and market share as
consumers  make purchases elsewhere.  Further, an increase in supply costs could
increase  operating  losses  beyond  current  expectations.

THE COMPANY DEPENDS UPON FEDERAL EXPRESS TO DELIVER ITS PRODUCTS ON A TIMELY AND
CONSISTENT  BASIS.  A  DETERIORATION  IN THE COMPANY'S RELATIONSHIP WITH FEDERAL
EXPRESS  COULD DECREASE THE COMPANY'S ABILITY TO TRACK SHIPMENTS, CAUSE SHIPMENT
DELAYS,  AND  INCREASE  ITS  SHIPPING  COSTS AND THE NUMBER OF DAMAGED PRODUCTS.

     The  Company's  supply  and  distribution  system  is  dependent  upon  its
relationship  with  Federal Express.  Federal Express ships substantially all of
the Company's orders, and the Company does not currently maintain a distribution
relationship  with  any  other  carrier.  As  a  result  of  reduced  expenses
contemplated  by  the  Restructuring  Plan  and the Company's limited cash, cash
equivalent  and  investment balances, the Company may experience problems in its
relationship  with Federal Express. Federal Express may be unwilling to continue
its  relationship with the Company on terms favorable to the Company, if at all.
If  the Company's relationship with Federal Express is terminated or impaired or
if Federal Express is unable to deliver product for the Company, whether through
labor  shortage,  slow  down  or  stoppage,  deteriorating financial or business
condition  or  for  any  other  reason,  the  Company  would  be required to use
alternative carriers for the shipment of products to its customers.  The Company
may  be  unable to engage an alternative carrier on a timely basis or upon terms
favorable to the Company.  Changing carriers would likely have a negative effect
on  the Company's business, operating results and financial condition. Potential
adverse  consequences  include:

-     reduced  visibility  into  order  status  and  package  tracking;

-     delays  in  order  processing  and  product  delivery;

-     increased  cost  of  delivery,  resulting  in  reduced  gross margins; and

-     reduced shipment quality which may result in damaged products and customer
      dissatisfaction.

THE  COMPANY HAS RECENTLY TERMINATED OR MATERIALLY AMENDED ITS AGREEMENTS WITH A
NUMBER  OF  ONLINE  SERVICES,  SEARCH ENGINES AND DIRECTORIES.  AS A RESULT, THE
COMPANY  MAY  EXPERIENCE  REDUCED  TRAFFIC  TO  ITS  WEB  SITE.


                                       34
<PAGE>
     The  Company  has  relied  on  relationships  with various online services,
search  engines  and directories to provide content and advertising banners that
hyperlink to the Company's Web site and on search engines, directories and other
navigational  tools  to  direct  traffic  to the Company's Web site.  During the
first  quarter  of  fiscal  2001, the Company terminated or materially amended a
number  of  these  relationships,  including  with  iVillage  and  Excite.  The
Company's  business,  operating  results  and  financial  condition  could  be
negatively  affected  by  these  new  arrangements.  The  Company may experience
reduced  online  traffic  and  revenues.

ESTABLISHING  THE GARDEN.COM BRAND QUICKLY AND COST-EFFECTIVELY IS ESSENTIAL FOR
THE COMPANY TO BE SUCCESSFUL.  IF THE COMPANY DOES NOT EFFECTIVELY ESTABLISH THE
GARDEN.COM  BRAND,  IT  MAY  NOT  CAPTURE  SUFFICIENT  MARKET  SHARE OR INCREASE
REVENUES  ENOUGH  TO  ACHIEVE  PROFITABILITY.

     The  Company  believes  that  it  must  establish, maintain and enhance the
Garden.com  brand  to  attract  more  customers  to its Web site and to generate
revenues  from  product  sales  and advertising.  Brand recognition and customer
loyalty  will  become  increasingly  important  as  more  companies  with
well-established  brands  in  online  services  or  the gardening industry offer
competing  services  on the Internet.  For example, existing gardening retailers
with established brand names may establish an online presence that competes with
the  Company's  Web  site  and  existing  online  providers  with  better  name
recognition  than  Garden.com may begin selling garden products.  Development of
the Garden.com brand will depend largely on the Company's success in providing a
high  quality  online  experience supported by a high level of customer service,
which cannot be assured, particularly in view of the Company's reduced marketing
expenses  and  work  force  reductions.

GARDENING  CONSUMERS  MAY  NOT  ACCEPT  THE COMPANY'S ONLINE SOLUTION.  THIS MAY
RESULT  IN  SLOWER  REVENUE  GROWTH,  LOSS  OF  REVENUES AND INCREASED OPERATING
LOSSES.

     To  be successful, the Company must attract and retain a significant number
of  consumers  to  the garden.com Web site at a reasonable cost. Any significant
shortfall  in  the  number of transactions occurring over the Company's Web site
will  negatively  affect  its  financial  results  by  increasing  or prolonging
operating  losses.  Conversion of customers from traditional shopping methods to
electronic  shopping may not occur as rapidly as the Company expects, if at all.
Therefore,  the Company may not achieve the critical mass of customer traffic it
believes is necessary to become successful.  Specific factors that could prevent
widespread  customer  acceptance  of  the Company's solution, and its ability to
grow  revenues,  include:

-     customer  concerns  about  the  security  of  online  transactions;

-     customer  concerns  about buying live plants and other gardening materials
      without  first  seeing  them;

-     pricing  that  may  not  meet  customer  expectations;


                                       35
<PAGE>
-     customer resistance to shipping charges, which generally  do  not apply to
      purchases  from  traditional  retail  outlets;

-     difficulties  in  timely shipment of plants, flowers and other live goods;

-     shipment  of damaged goods or wrong products from the Company's suppliers;

-     delivery  time  before  customers  receive  Internet  orders,  unlike  the
      immediate  receipt  of  products  at  traditional  retail  outlets;  and

-     difficulties  in  returning  or  exchanging  orders.

THE  COMPANY  DEPENDS  ON  THE  ECONOMIC  STRENGTH OF THE GARDENING INDUSTRY AND
FAVORABLE  GENERAL  ECONOMIC  CONDITIONS.  ANY  SIGNIFICANT  DOWNTURN  IN  THE
GARDENING  INDUSTRY  OR IN GENERAL ECONOMIC CONDITIONS COULD RESULT IN DECREASED
REVENUES  AND  COULD  SERIOUSLY  HARM  THE  COMPANY'S  BUSINESS.

     The  Company  has  derived  substantially  all  of its revenues directly or
indirectly  from the gardening industry, and its future operating results depend
on  the  economic  strength  of  this industry.  Any significant downturn in the
gardening  industry  could  result  in decreased revenues and seriously harm the
Company's  business,  operating  results  and financial condition.  Purchases of
gardening  and  gardening-related  products  are  typically  discretionary  for
consumers  and  may  be  harmed  by  negative trends in the general economy.  In
addition,  the  Company's  business  strategy  relies  on  advertising  by  and
agreements  with  other  Internet  companies.  Any  significant deterioration in
general economic conditions that harms these companies could result in decreased
advertising  revenues  and  have  a  negative  impact on the Company's business,
operating  results  and  financial  condition.

THE  COMPANY  DEPENDS  ON  ITS THIRD PARTY SUPPLIERS TO PROVIDE QUALITY PRODUCTS
DIRECTLY TO ITS CUSTOMERS.  THE COMPANY COULD LOSE REVENUES AND MARKET SHARE AND
ITS  BRAND  NAME COULD BE HARMED IF THE COMPANY'S SUPPLIERS FAIL TO SHIP QUALITY
PRODUCTS  TO  ITS  CONSUMERS.

     Because  the  Company's  revenues depend on the number of customers who buy
products from the Company, the reliability and quality of the Company's products
are  critical  to  its  operating  results.  The Company is heavily dependent on
suppliers  for  assuring the quality and health of the products shipped directly
to  the  Company's  customers.  The  failure  of  the  Company's  suppliers  to
consistently provide high quality products could result in lost revenues, delays
in  customer  acceptance,  damage  to  the  Company's reputation and harm to the
Company's  brand  name.  In  addition,  the  Company does not currently maintain
insurance  against  any product defect losses and, accordingly, could be subject
to  significant  defense  costs or damages in the event of a significant product
defect  claim.

WEATHER  AND  OTHER ACTS OF NATURE COULD AFFECT THE SUPPLY OF AND DEMAND FOR THE
COMPANY'S PRODUCTS.  AS A RESULT, INCLEMENT WEATHER COULD INCREASE THE COMPANY'S
COSTS  OR  DECREASE  ITS  REVENUES.


                                       36
<PAGE>
     Weather  and  other  acts  of nature outside of the Company's control could
negatively  impact  its  business,  operating  results  and financial condition.
Adverse  weather,  such  as  frost,  droughts,  floods  and other severe weather
patterns, as well as plant diseases and pests can reduce or eliminate the supply
of  live  products, which could lead to increased prices for available products.
In addition, adverse weather or other growing conditions could negatively impact
consumer  demand  for  gardening and gardening-related products.  For example, a
late  spring  can  lead  to  delayed  or  poor spring growing conditions for the
Company's  live  goods  reducing  product  availability.  Decreased availability
could  lead  to reduced sales or increased costs and operating losses.  Further,
inclement  weather  during  the peak gardening season in spring and early summer
may  discourage  consumer  gardening  purchases.

THE  COMPANY  MAY NOT BE ABLE TO CONTINUE TO OFFER NEW AND EXPANDED PRODUCTS AND
SERVICES.

     The  Company  has  relied on new and expanded products and services and new
relationships  with  third  parties  in  order  to generate additional revenues,
attract  more consumers, increase market share and respond to competition.  As a
result  of  the  reduced expenditures contemplated by the Restructuring Plan and
the Company's limited cash, cash equivalent and investment balances, the Company
may  be  unable  to  provide  sufficient levels of new and expanded products and
services  offerings to consumers.  This reduction in products and services could
harm  the  appeal  of Garden.com's Web site and result in reduced online traffic
and  reduced  product  and  advertising  revenue  levels.

PROTECTION  OF  THE  COMPANY'S DOMAIN NAMES IS UNCERTAIN.  IF THE COMPANY CANNOT
PROTECT  ITS  DOMAIN  NAMES,  IT  WILL  IMPAIR  THE  COMPANY'S  ABILITY TO BRAND
SUCCESSFULLY  THE  GARDEN.COM  NAME.

     The  Company currently holds various World Wide Web domain names, including
garden.com.  The  acquisition  and  maintenance  of  domain  names  generally is
regulated  by Internet regulatory bodies.  The regulation of domain names in the
United  States  and in foreign countries is subject to change.  Governing bodies
may  establish  additional  top-level  domains,  appoint  additional domain name
registrars  or  modify  the requirements for holding domain names.  As a result,
the  Company  may  be unable to acquire or maintain relevant domain names in all
countries  in which it conducts business.  Furthermore, the relationship between
regulations  governing  domain  names and laws protecting trademarks and similar
proprietary  rights is unclear.  Therefore, the Company may be unable to prevent
third  parties from acquiring domain names that are similar to, infringe upon or
otherwise  decrease  the value of the Company's trademarks and other proprietary
rights.  The  Company  may  not  successfully carry out its business strategy of
establishing  a strong brand for Garden.com if the Company cannot prevent others
from  using similar domain names or trademarks.  This could impair the Company's
ability  to  increase  market  share  and  revenues.

THE  COMPANY'S  OPERATING RESULTS DEPEND ON ITS WEB SITE, NETWORK INFRASTRUCTURE
AND  TRANSACTION-PROCESSING  SYSTEMS.


                                       37
<PAGE>
     The satisfactory performance, reliability and availability of the Company's
Web site, transaction-processing systems and network infrastructure are critical
to  the  Company's  operating  results, as well as to its ability to attract and
retain  customers  and  maintain  adequate  customer service levels.  Any system
interruptions  that  result  in  the unavailability of the Company's Web site or
reduced  performance of the transaction systems would reduce the volume of sales
and the attractiveness of the Company's service offerings, which would seriously
harm  its  business,  operating results and financial condition.  As a result of
reduced  expenses  contemplated  by  the  Restructuring  Plan  and the Company's
limited  cash,  cash  equivalent  and  investment  balances,  the  Company  may
experience  problems  related  to  operations  and  technology development.  The
Company  may  be  unable  to  retain  or  attract  employees  with  the required
technological  skills.  In addition, the Company may have insufficient resources
to  invest  in  the  hardware  or  software  products  necessary to successfully
implement  its  strategy.

     The  Company  has  experienced periodic systems interruptions due to server
failure,  which  the  Company believes will continue to occur from time to time.
If  the  volume  of traffic on the Company's Web site or the number of purchases
made  by  customers  substantially  increases,  the Company will need to further
expand  and  upgrade  its technology, transaction processing systems and network
infrastructure.  The  Company  has  experienced  and  expects  to  continue  to
experience  temporary  capacity  constraints  due  to  sharply increased traffic
during  sales or other promotions, which cause unanticipated system disruptions,
slower  response  times,  degradation  in  levels  of customer service, impaired
quality  and  delays  in  reporting  accurate  financial  information.

     The Company's transaction processing systems and network infrastructure may
not  be able to accommodate increases in traffic in the future.  The Company may
be  unable  to  project  accurately  the  rate or timing of traffic increases or
successfully  upgrade  its  systems  and  infrastructure  to  accommodate future
traffic  levels  on  its  Web site.  In addition, the Company may be unable in a
timely  manner  to  effectively  upgrade  and  expand its transaction processing
systems  or  to  successfully integrate any newly developed or purchased modules
with  its  existing  systems. Any inability to do so could negatively impact the
Company's  sales  volume,  business,  operating results and financial condition.

THE  COMPANY'S  COMPUTERS AND COMMUNICATIONS SYSTEMS ARE VULNERABLE TO DAMAGE OR
INTERRUPTION  WHICH  MAY  HINDER  THE  COMPANY'S  ABILITY  TO  DELIVER  TIMELY
INFORMATION  OR  EXECUTE  ONLINE  TRANSACTIONS.

     The  Company's  ability  to  successfully  receive  and  fulfill orders and
provide high quality customer service depends on the efficient and uninterrupted
operation  of  its  computer and communications hardware systems.  Substantially
all  of  the  Company's  computer  and communications systems are located in two
separate  locations  in Austin, Texas.  The Company's systems and operations are
vulnerable  to  damage  or  interruption  from  fire,  flood,  power  loss,
telecommunications failure, break-ins and similar events.  Despite the Company's
implementation  of  network  security  measures,  its  servers are vulnerable to
computer  viruses,  physical  or  electronic  break-ins and similar disruptions,
which  could  lead  to  interruptions,  delays,  loss  of  data

                                       38
<PAGE>
or  the  inability to accept and confirm customer orders.  The occurrence of any
of  the  foregoing  risks  could  negatively  impact the Company's sales volume,
business,  operating  results  and  financial  condition.

THE  COMPANY  IS  SUBJECT  TO GOVERNMENT REGULATIONS RELATING TO THE SHIPMENT OF
LIVE  GOODS,  FERTILIZERS AND OTHER PRODUCTS, WHICH EXPOSES THE COMPANY TO RISKS
THAT  IT  WILL  BE  FINED  OR  EXPOSED  TO  CIVIL OR CRIMINAL LIABILITY, RECEIVE
NEGATIVE  PUBLICITY  OR  BE  PREVENTED  FROM  SHIPPING PRODUCTS INTO ONE OR MORE
STATES.

     The  Company  is  subject  to federal, state and local laws and regulations
relating  to  the  shipment  of live goods, fertilizers and other products.  For
instance,  various federal, state and local authorities regulate the shipment of
plants  and  products  across  their  borders,  in  an  attempt  to restrict the
introduction  of  harmful  plants,  pests  and diseases.  Additionally, products
marketed  or  that  may  be marketed as fertilizers or pesticides are subject to
federal,  state and local laws and regulations.  The Company currently relies on
its suppliers to comply with these laws and regulations. However, the Company is
unable  to  verify that its suppliers have complied or will comply with all such
laws  and  regulations.  The  Company could be subject to the following if these
requirements  have  not  been  fully  met  by  its  suppliers or by it directly:

-     the  Company  could  be fined or exposed to civil or criminal liability or
      remediation  expenses;

-     the  Company  could  receive negative publicity, devaluing its brand name;
      and

-     the  Company  may  be  prevented  from  shipping products into one or more
      states.

THE  COMPANY'S  PERFORMANCE DEPENDS ON THE GROWTH AND ACCEPTANCE OF THE INTERNET
AS  A  MEDIUM  FOR  COMMERCE.  WITHOUT  THE  GROWTH AND ACCEPTANCE OF ELECTRONIC
COMMERCE,  THE  COMPANY  MAY  NOT  ACHIEVE THE REVENUE GROWTH REQUIRED FOR IT TO
ACHIEVE  PROFITABILITY.

     The Company cannot be sure that a sufficiently broad base of consumers will
adopt,  and  continue  to  use, the Internet and commercial online services as a
medium  for  commerce,  particularly  for  purchases  of  gardening  and
gardening-related  products.  Even  if  consumers adopt the Internet as a medium
for  commerce, the Company cannot be sure that the necessary infrastructure will
be  in  place  to  process such transactions.  The Company's long-term viability
depends  substantially upon the widespread acceptance and the development of the
Internet  as  an  effective medium for consumer commerce. Use of the Internet to
effect  retail  transactions  is  at  an  early stage of development. Convincing
consumers  to  purchase  gardening-related  products  online may be particularly
difficult because consumers are accustomed to a high degree of human interaction
in  purchasing  gardening-related  products.

     Demand  for recently introduced services and products over the Internet and
commercial  online  services  is  subject to a high level of uncertainty and few
proven  services  and  products  exist.  The  development  of  the  Internet and
commercial  online services into a viable commercial marketplace is subject to a
number  of  factors,  including:


                                       39
<PAGE>
-     continued  growth  in  the  number  of  users  of  such  services;

-     concerns  about  transaction  security;

-     continued  development  of  the  necessary  technological  infrastructure;

-     development  of  enabling  technologies;

-     uncertain  and  increasing  government  regulation;  and

-     the  development  of  complementary  services  and  products.

     To  the  extent  that  the  Internet  and other online services continue to
experience  growth  in  the  number  of  users and frequency of use by consumers
resulting  in  increased  bandwidth  demands, there can be no assurance that the
infrastructure  for  the  Internet  and  other  online  services will be able to
support the demands placed upon them.  In addition, the Internet or other online
services could lose their viability due to delays in the development or adoption
of  new  standards and protocols required to handle increased levels of Internet
or  other  online service activity, or due to increased governmental regulation.
Insufficient availability of telecommunications services to support the Internet
or  other  online  services  also  could  result  in  slower  response times and
negatively  impact  use  of the Internet and other online services generally and
the Company in particular.  If the use of the Internet and other online services
fails  to grow or grows more slowly than expected, if the infrastructure for the
Internet  and  other  online services do not effectively support growth that may
occur  or  if  the  Internet  and  other  online services do not become a viable
commercial  marketplace,  the  Company's  sales  growth  may  be insufficient to
achieve  profitability,  and  its operating results and financial condition will
consequently  suffer.

RAPID  TECHNOLOGICAL  CHANGE  COULD  RENDER  THE  COMPANY'S WEB SITE AND SYSTEMS
OBSOLETE  AND  REQUIRE  SIGNIFICANT  CAPITAL  EXPENDITURES.

     If the Company is unable, for technical, legal, financial or other reasons,
to  adapt  in  a  timely  manner  in  response  to changing market conditions or
customer  requirements,  the Company's business, operating results and financial
condition  could  be  harmed.  The Internet and the online commerce industry are
characterized by rapid technological change, sudden changes in user and customer
requirements  and  preferences,  frequent  new product and service introductions
embodying  new  technologies  and  the  emergence  of new industry standards and
practices  that  could render the Company's existing online site and proprietary
technology  and  systems  obsolete.  The  emerging  nature of these products and
services  and  their  rapid  evolution will require that the Company continually
improve  the  performance,  features  and  reliability  of  its online services,
particularly  in  response to competitive offerings.  The Company's success will
depend,  in  part,  on  its  ability:

-     to  enhance  the  Company's  existing  services;


                                       40
<PAGE>
-     to  develop  and  license  new  services  and  technology that address the
      increasingly  sophisticated  and varied needs of the Company's prospective
      customers;  and

-     to  respond  to technological advances and emerging industry standards and
      practices  on  a  cost-effective  and  timely  basis.

     As  a result of reduced expenses contemplated by the Restructuring Plan and
the Company's limited cash, cash equivalent and investment balances, the Company
may  be  unable  to  respond  to  technological  advances or adapt its Web site,
proprietary  technology  and  transaction-processing  systems  to  customer
requirements  or  emerging industry standards.  The development of Web sites and
other  proprietary  technology  also  entails significant technical and business
risks  and  requires  substantial  expenditures  and  lead  time.

THE  COMPANY  IS  EXPOSED  TO RISKS ASSOCIATED WITH ONLINE COMMERCE SECURITY AND
CREDIT  CARD  FRAUD,  WHICH  MAY  REDUCE  COLLECTIONS  AND  DISCOURAGE  ONLINE
TRANSACTIONS.

     Consumer  concerns  about  the  security  of  transactions conducted on the
Internet  or  the  privacy  of  users may inhibit the growth of the Internet and
online  commerce.  To  securely  transmit  confidential  information,  such  as
customer  credit  card  numbers,  the  Company  relies  on  encryption  and
authentication  technology  that  it  licenses  from third parties.  The Company
cannot  predict  whether  events  or developments will result in a compromise or
breach  of the algorithms the Company uses to protect customer transaction data.
Furthermore,  the  Company's  servers  may  be  vulnerable  to computer viruses,
physical  or electronic break-ins and similar disruptions.  The Company may need
to  expend significant additional capital and other resources to protect against
a  security  breach  or  to  alleviate  problems  caused  by  any breaches.  The
Company's  business  may  be  adversely affected if its security measures do not
prevent  security breaches and there can be no assurance that it can prevent all
security  breaches.

     To date, the Company has suffered minor losses as a result of orders placed
with  fraudulent  credit  card  data  even  though  the  associated  financial
institution  approved  payment of the orders in each case.  Under current credit
card  practices,  a  merchant  is liable for fraudulent credit card transactions
where, as is the case with the transactions the Company processes, that merchant
does  not  obtain  a  cardholder's  signature.  A  failure to adequately control
fraudulent  credit  card transactions could reduce the Company's collections and
harm  its  business.

THE  COMPANY  COULD FACE LIABILITY FOR INFORMATION RETRIEVED FROM OR TRANSMITTED
THROUGH  ITS WEB SITE, WHICH COULD RESULT IN HIGH LITIGATION OR INSURANCE COSTS.

     As  a  publisher  and  distributor  of  online  content,  the Company faces
potential  liability  for defamation, negligence, copyright, patent or trademark
infringement  and  other claims based on the nature and content of the materials
that  the  Company  publishes  or  distributes.  Claims  have  been successfully
brought  against  online services.  In addition, the Company does not and cannot
practically  screen  all  of  the content generated by its users on the bulletin
board system on its Web site, and the Company could be exposed to liability with
respect  to  such  content.  Although  the  Company  carries  general  liability
insurance,  the  Company's  insurance  may  not  cover  claims  of

                                       41
<PAGE>
these  types  or  may not be adequate to indemnify the Company for all liability
that  may  be imposed.  Any imposition of liability, particularly liability that
is  not  covered  by  insurance  or  is  in  excess of insurance coverage, could
negatively  impact  the  Company's  reputation and result in litigation costs or
increased  insurance  costs.

FUTURE  GOVERNMENT  REGULATION  OF  THE  INTERNET  COULD DECREASE DEMAND FOR THE
COMPANY'S  PRODUCTS  OR  INCREASE  THE  COMPANY'S  COSTS OF CONDUCTING BUSINESS.

     New  Internet  legislation  or  regulation,  the  application  of  laws and
regulations from jurisdictions whose laws do not currently apply to the Internet
and  online commerce, or the application of existing laws and regulations to the
Internet  and  online  commerce  could  harm  the  Company's business, operating
results  and  financial  condition.  The  Company  is  subject  to  regulations
applicable  to  businesses generally and laws or regulations directly applicable
to  communications  over  the  Internet and access to online commerce.  Although
there are currently few laws and regulations directly applicable to the Internet
and  online  retailing  services,  it  is  possible  that  a  number of laws and
regulations  may be adopted with respect to the Internet covering issues such as
user  privacy,  pricing,  content, copyrights, distribution, antitrust, taxation
and  characteristics  and  quality  of  products and services.  For example, the
United  States  Congress  recently  enacted  Internet  laws regarding children's
privacy, copyrights, taxation and transmission of sexually explicit material and
the  European  Union recently enacted its own privacy regulations.  Furthermore,
the  growth  and  development of the market for online commerce may prompt calls
for  more  stringent consumer protection laws that may impose additional burdens
on  those  companies conducting business online.  The adoption of any additional
laws  or regulations regarding Internet commerce and communications may decrease
the  growth of the Internet or commercial online services, which could, in turn,
decrease  the  demand  for  the Company's products and services and increase the
Company's  cost  of  doing  business,  leading  to  further  losses.

     Moreover,  the  applicability  to  the Internet of existing laws in various
jurisdictions  governing  issues  such  as  property  ownership, sales and other
taxes,  libel  and  personal privacy is uncertain and may take years to resolve.
For  example,  tax authorities in a number of states are currently reviewing the
appropriate tax treatment of companies engaged in online commerce, and new state
tax  regulations  may  subject  the Company to additional state sales and income
taxes.  Additionally,  German  authorities  have  challenged  major  U.S. online
services  for  making certain content accessible in Germany.  If the Company was
alleged  to  have  violated federal, state or foreign civil or criminal law, the
Company  could  be  subject  to  liability,  and  even  if  the  Company  could
successfully  defend  such claims, they may involve significant legal compliance
and  litigation  costs.

THE  COMPANY  MAY  NOT  BE  ABLE  TO MAINTAIN ITS LISTING ON THE NASDAQ NATIONAL
MARKET.

     The  Company's  Common  Stock  is  currently  listed on the Nasdaq National
Market.  The  Company  must  satisfy  a  number  of requirements to maintain its
listing on the Nasdaq National Market, including maintaining a minimum bid price
for the Common Stock of either $1.00 per share or $5.00 per share, depending on,
among  other  things,  whether  the  net  tangible  assets  of  the

                                       42
<PAGE>
Company  is  greater  than $4 million.  As of June 30, 2000, the Company had net
tangible  assets  of  $34.4  million.  The  amount of the Company's net tangible
assets  will  continue  to decrease unless the Company achieves profitability or
the  Company  is  able  to  complete  a new equity financing.  If the Company is
unable to maintain net tangible assets of at least $4 million, the Company could
no  longer  use  the  $1.00 minimum bid test.  In addition, the Company's Common
Stock  has  recently  had  trading  days below the minimum $1.00 bid price which
could  result  in  the  delisting of the Common Stock or require a reverse stock
split  to  maintain  the listing.  If the Common Stock loses its Nasdaq National
Market status, the Common Stock would trade either on the Nasdaq SmallCap Market
or  on  the  Over  the  Counter Bulletin Board, both of which are viewed by most
investors  as  less  desirable, less liquid marketplaces.  Loss of the Company's
Nasdaq  National Market listing would also complicate compliance with state blue
sky  laws  and could make it more difficult to complete a financing transaction.

ANTI-TAKEOVER  PROVISIONS  IN  THE  COMPANY'S CHARTER DOCUMENTS AND DELAWARE LAW
COULD  PREVENT  OR  DELAY  A  CHANGE  IN  CONTROL  OF  THE  COMPANY.

     The  Company's  Restated  Certificate  of  Incorporation  and  Amended  and
Restated  By-Laws may discourage, delay or prevent a merger or acquisitions that
a  stockholder  may  consider  favorable  by:

-     authorizing  the  issuance  of  "blank  check"  preferred  stock;

-     providing  for  a classified board of directors with staggered, three-year
      terms;

-     prohibiting  cumulative  voting  in  the  election  of  directors;

-     limiting  the  persons  who  may  call  special  meetings of stockholders;

-     prohibiting  stockholder  action  by  written  consent;  and

-     establishing  advance  notice requirements for nominations for election to
      the board of directors or for proposing  matters  that  can be acted on by
      stockholders  at  stockholder  meetings.

ITEM  7A.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK.

     The  Company did not hold any significant market risk sensitive instruments
during  the  period  covered  by  this  report.

ITEM  8.     FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA

FINANCIAL  STATEMENTS

     The  consolidated financial statements of the Company and notes thereto are
filed  under  this  item  beginning  on  page  F-1  of  this  report.


                                       43
<PAGE>
SELECTED  QUARTERLY  RESULTS  OF  OPERATIONS

     The  following table sets forth selected unaudited statement of income data
for  the  eight  quarters  ended  June 30, 2000, both in dollar amounts and as a
percentage  of total revenues.  This data should be read in conjunction with the
audited  financial  statements for the fiscal years ended June 30, 2000 and 1999
and  related  notes  included  elsewhere  in  this  report.

                                       44
<PAGE>
<TABLE>
<CAPTION>

                                                                   Quarter  Ended
                            -----------------------------------------------------------------------------------------------
                             June 30,    March 31,    Dec. 31,    Sep. 30,    June 30,    March 31,    Dec. 31,    Sep. 30,
                               2000        2000         1999        1999        1999        1999         1998        1998
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------
                                                                   (in  thousands)
<S>                         <C>         <C>          <C>         <C>         <C>         <C>          <C>         <C>
Revenues:
  Products . . . . . . . .  $   6,489   $    2,600   $   3,317   $   1,159   $   2,637   $      856   $   1,125   $     333
  Advertising. . . . . . .        838          556         291         253         247           83          87          25
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

 Total revenues. . . . . .      7,327        3,156       3,608       1,412       2,884          939       1,212         358
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Cost of revenues:
  Products . . . . . . . .      5,651        2,109       2,609       1,049       2,446          763         898         359
  Advertising. . . . . . .         49           90          21          44          20            8          32          13
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

    Total cost of revenues      5,700        2,199       2,630       1,093       2,466          771         930         372
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Gross profit . . . . . . .      1,627          957         978         319         418          168         282         (14)
Operating expenses:
  Marketing and sales. . .     10,616        8,435       4,904       2,699       6,239        3,686       1,246       2,133
  Technology, content
   and product
   development . . . . . .      2,095        1,768       1,648       1,408       1,001          928         599         640
  General and
   administrative. . . . .      2,075        2,002       1,667       1,308       1,061          803         572         504
  Depreciation and
    amortization . . . . .        719          577         464         347         233          142         124         112
  Amortization of deferred
   compensation. . . . . .        214          250         298         374         370          117          82         105
  Restructuring and other
   activities. . . . . . .        888           --          --          --          --           --          --          --
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

     Total operating
      expenses . . . . . .     16,607       13,032       8,981       6,136       8,904        5,676       2,623       3,494
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Operating loss . . . . . .    (14,980)     (12,075)     (8,003)     (5,817)     (8,486)      (5,508)     (2,341)     (3,508)
Other income and expense .        475          636         791         249         220          124         192         248
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Net loss . . . . . . . . .  $ (14,505)  $  (11,439)  $  (7,212)  $  (5,568)  $  (8,266)  $   (5,384)  $  (2,149)  $  (3,260)
                            ==========  ===========  ==========  ==========  ==========  ===========  ==========  ==========
                                                               Percentage of Total Revenues
                            -----------------------------------------------------------------------------------------------
                             June 30,    March 31,    Dec. 31,    Sep. 30,    June 30,    March 31,    Dec. 31,    Sep. 30,
                               2000        2000         1999        1999        1999        1999         1998        1998
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------
Revenues:
  Products . . . . . . . .         89%          82%         92%         82%         91%          91%         93%         93%
  Advertising. . . . . . .         11           18           8          18           9            9           7           7
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

     Total revenues. . . .        100          100         100         100         100          100         100         100
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Cost of revenues:
  Products . . . . . . . .         77           67          72          74          85           81          74         100
  Advertising. . . . . . .          1            3           1           3           1            1           3           4
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------
Total cost of revenues . .         78           70          73          77          86           82          77         104
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Gross profit . . . . . . .         22           30          27          23          14           18          23          (4)
Operating expenses:
  Marketing and sales. . .        145          267         136         191         216          392         103         596
  Technology, content
    and product
    development. . . . . .         28           56          46         100          35           99          50         179
  General and
   administrative. . . . .         28           63          46          93          37           86          47         141
  Depreciation and
   amortization. . . . . .         10           18          13          25           8           15          10          31
  Amortization of deferred
   compensation. . . . . .          3            8           8          26          13           12           6          29
  Restructuring and other
   activities. . . . . . .         12           --          --          --          --           --          --          --
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Total operating expenses .        226          412         249         435         309          604         216         976
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Operating loss . . . . . .       (204)        (382)       (222)       (412)       (295)        (586)       (193)       (980)
Other income and expense .          6           20          22          18           8           13          16          69
                            ----------  -----------  ----------  ----------  ----------  -----------  ----------  ----------

Net loss . . . . . . . . .      (198)%       (362)%      (200)%      (394)%      (287)%       (573)%      (177)%      (911)%
                            ==========  ===========  ==========  ==========  ==========  ===========  ==========  ==========
</TABLE>

                                       45
<PAGE>
ITEM  9.     CHANGES  IN  AND  DISAGREEMENTS  WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL  DISCLOSURE

     Not  applicable.

                                    PART III
                                    --------

ITEM  10.     DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT

     Information  regarding  the executive officers and directors of the Company
is  incorporated  herein  by  reference  to  the  discussions under "Election of
Directors"  and "Section 16(a) Beneficial Ownership Reporting Compliance" in the
Company's Proxy Statement for the 2000 Annual Meeting of Stockholders which will
be  filed  on  or  before  October  28,  2000.

ITEM  11.     EXECUTIVE  COMPENSATION

     Incorporated  herein  by  reference  to  the  discussion  under  "Executive
Compensation"  in  the  Company's Proxy Statement for the 2000 Annual Meeting of
Stockholders  which  will  be  filed  on  or  before  October  28,  2000.

ITEM  12.     SECURITY  OWNERSHIP  OF  CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     Incorporated  herein  by  reference  to  the  discussion  under  "Security
Ownership"  in  the  Company's  Proxy  Statement  for the 2000 Annual Meeting of
Stockholders  which  will  be  filed  on  or  before  October,  28,  2000.

ITEM  13.     CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

     Incorporated  herein  by  reference  to  the  discussions  under "Executive
Compensation--Employment  Agreements"  and  "Certain  Relationships  and Related
Transactions"  in  the  Company's Proxy Statement for the 2000 Annual Meeting of
Stockholders  which  will  be  filed  on  or  before  October  28,  2000.

ITEM  14.     EXHIBITS  AND  FINANCIAL  STATEMENT  SCHEDULES

(a)     The  following  documents  are  filed  as  part  of  this  report:

     1.     Financial  Statements.  The  following  financial  statements of the
            ---------------------
Company  are  included  in  Item  8  of  this  report.

          Report  of  Ernst  &  Young  LLP,  Independent  Auditors

          Balance  Sheets  -  as  of  June  30,  2000  and  1999.

          Statements of Operations - for the years ended June 30, 2000, 1999 and
1998.

                                       46
<PAGE>
          Statements  of  Changes  in  Common  Stock  and  Stockholders'  Equity
(Deficit)  -  for  the  years  ended  June  30,  2000,  1999  and  1998.

          Statements of Cash Flows - for the years ended June 30, 2000, 1999 and
1998.

          Notes  to  financial  statements.

     2.   Financial  Statement  Schedules:
          -------------------------------

          Schedules have been omitted because the information required to be set
forth therein is not applicable or is shown in the financial statements or notes
thereto.

     3.   Exhibits:
          --------
<TABLE>
<CAPTION>

EXHIBIT NUMBER                           DOCUMENT DESCRIPTION
---------------  --------------------------------------------------------------------
<S>              <C>
3.1A             Restated Certificate of Incorporation. (1)

3.1B             Amended and Restated By-Laws. (1)

4.1              Specimen Common Stock Certificate. (2)

10.1             Form of Indemnification Agreement between the Company and each
                 of its directors and officers. (2)

10.2A            Amended and Restated 1996 Stock Option/Stock Issuance Plan. (2)(3)

10.2B            Form of Option Agreement under the Amended and Restated 1996
                 Stock Option/Stock Issuance Plan. (2)(3)

10.2C            Form of Restricted Stock Purchase Agreement under the Amended
                 and Restated 1996 Stock Option/Stock Issuance Plan. (2)(3)

10.3             1999 Employee Stock Purchase Plan. (2)(3)

10.4             Fourth Amended and Restated Stockholders Agreement, dated as of
                 April 13, 1999, among the Company and the stockholders of the
                 Company listed on the signature page thereto. (2)

10.5             Fourth Amended and Restated Registration Rights Agreement, dated
                 as of April 13, 1999, among the Company and the stockholders of the
                 Company listed on the signature page thereto. (2)

                                       47
<PAGE>
10.6             Letter Agreement, dated May 24, 1999, between the Company and
                 Scripps Howard Broadcasting Company d/b/a Home & Garden
                 Television. (2)

10.7             Shopping Channel Promotional Agreement, dated as of October 2,
                 1998, between the Company and America Online, Inc. (2)(4)

10.8             License Agreement, dated as of April 13, 1998, between the Company
                 and Time Life Inc. (2)

10.9A            Employment Agreement, dated July 12, 1999, between the Company
                 and Clifford A. Sharples. (2)(3)

10.9B            Employment Agreement, dated July 12, 1999, between the Company
                 and James N. O'Neill. (2)(3)

10.9C            Employment Agreement, dated July 12, 1999, between the Company
                 and Lisa W.A. Sharples. (2)(3)

10.10            Sublease Agreement, dated as of February 24, 1999, between the
                 Company and Hart Graphics, Inc. (2)

10.11            Employment Agreement, dated as of March 1, 1996, between the
                 Company and Andrew R. Martin. (2)(3)

10.12            Buy-Sell Agreement, dated February 27, 1997, among the Company,
                 Clifford A. Sharples, James N. O'Neill, Lisa W.A. Sharples and
                 Andrew R. Martin. (2)

10.13            Content License Agreement, dated as of November 2, 1999, between
                 the Company and iVillage Inc. (4)(5)

10.14            Online Merchant Agreement, dated as of October 15, 1999, between
                 the Company and iVillage Inc. (4)(5)

21               Subsidiaries.

23               Consent of Ernst & Young LLP, Independent Auditors.

24               Power of Attorney (see Page 50).

27               Financial Data Schedule.
_______________
<FN>

(1)     Incorporated  by reference to the Company's Quarterly Report on Form 10-Q for
        the  quarter  ended  September  30,  1999  (File  No.  0-26265).

                                       48
<PAGE>

(2)     Incorporated by reference to the Company's Registration Statement on Form S-1
        (Registration  No.  333-79487).

(3)     Management  contract  or  compensatory  plan  or  arrangement.

(4)     The  Company  has  request confidential treatment of certain portions of this
        Exhibit.

(5)     Incorporated  by reference to the Company's Quarterly Report on Form 10-Q for
        the  quarter  ended  December  31,  1999  (File  No.  0-26265).
</TABLE>

(b)     Reports  on  Form  8-K.

     The  Company filed no reports on Form 8-K during the quarter ended June 30,
2000.

(c)     Exhibits.

     The  response to this portion of Item 14 is submitted as a separate section
of  this  report.

(d)     Financial  Statement  Schedules.

     None.

                                       49
<PAGE>
                                   SIGNATURES

          Pursuant  to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its  behalf  by  the  undersigned,  thereunto  duly  authorized.

                                 GARDEN.COM,  INC.

                                 By /s/ Clifford A. Sharples
                                    --------------------------------------------
                                   Clifford A. Sharples, Chief Executive Officer

Date:  October  13,  2000


                                POWER OF ATTORNEY

          Each  person whose signature appears below hereby appoints Clifford A.
Sharples  and Jana D. Wilson, and each of them individually, his or her true and
lawful  attorney-in-fact,  with  power to act with or without the other and with
full  power  of  substitution  and resubstitution, in any and all capacities, to
sign  any or all amendments to the Form 10-K and file the same with all exhibits
thereto,  and  other  documents in connection therewith, with the Securities and
Exchange  Commission, granting unto said attorneys-in-fact and agents full power
and  authority  to  do  and  perform  each and every act and thing requisite and
necessary  to  be  done  in  and about the premises, as fully to all intents and
purposes  as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or their substitutes, may lawfully cause
to  be  done  by  virtue  hereof.

          Pursuant  to  the requirements of the Securities Exchange Act of 1934,
this  report  has  been  signed  below by the following persons on behalf of the
Registrant  and  in  the  capacities  and  on  the  dates  indicated:
<TABLE>
<CAPTION>

<S>                       <C>                                  <C>

/s/ Clifford A. Sharples  President, Chief Executive           October 13, 2000
------------------------  Officer (Principal Executive
Clifford A. Sharples      Officer) and Director


/s/ Jana D. Wilson        Chief Financial Officer (Principal   October 13, 2000
------------------------  Financial and Accounting
Jana D. Wilson            Officer)


/s/ Steven J. Dietz       Director                             October 13, 2000
------------------------
Steven J. Dietz

/s/ Gerald R. Gallagher   Director                             October 13, 2000
------------------------
Gerald R. Gallagher

/s/ James N. O'Neill      Director                             October 13, 2000
------------------------
James N. O'Neill

/s/ Lisa W.A. Sharples    Director                             October 13, 2000
------------------------
Lisa W.A. Sharples

/s/ Douglas R. Stern      Director                             October 13, 2000
------------------------
Douglas R. Stern

/s/ John D. Thornton      Director                             October 13, 2000
------------------------
John D. Thornton
</TABLE>

                                       50
<PAGE>

GARDEN.COM,  INC.


TABLE  OF  CONTENTS
--------------------------------------------------------

<TABLE>
<CAPTION>
                                                    PAGE
<S>                                                 <C>
Report of Ernst & Young LLP, Independent Auditors.  F-2

Balance Sheets . . . . . . . . . . . . . . . . . .  F-3

Statements of Operations . . . . . . . . . . . . .  F-5

Statements of Changes in Common Stock and
  Stockholders' Equity (Deficit) . . . . . . . . .  F-6

Statements of Cash Flows . . . . . . . . . . . . .  F-7

Notes to Financial Statements. . . . . . . . . . .  F-8

</TABLE>


<PAGE>

                         REPORT OF INDEPENDENT AUDITORS


Board  of  Directors  and  Stockholders
Garden.com,  Inc.

     We  have  audited the accompanying balance sheets of Garden.com, Inc. as of
June  30, 2000 and 1999, and the related statements of operations, shareholders'
equity (deficit), and cash flows for each of the three years in the period ended
June  30,  2000.  These  financial  statements  are  the  responsibility  of the
Company's  management.  Our  responsibility  is  to  express an opinion on these
financial  statements  based  on  our  audits.

     We  conducted  our  audits  in accordance with auditing standards generally
accepted in the United States.  Those standards require that we plan and perform
the  audit to obtain reasonable assurance about whether the financial statements
are  free  of  material  misstatement.  An  audit  includes examining, on a test
basis,  evidence  supporting  the  amounts  and  disclosures  in  the  financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made  by  management,  as well as evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.

     In  our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Garden.com, Inc. at June 30,
2000  and 1999, and the results of its operations and its cash flows for each of
the three years in the period ended June 30, 2000, in conformity with accounting
principles  generally  accepted  in  the  United  States.

     The  accompanying financial statements have been prepared assuming that the
Company  will  continue  as a going concern.  As more fully described in Note 1,
the Company has incurred recurring operating losses and negative cash flows from
operations.  These  conditions  raise  substantial  doubt  about  the  Company's
ability  to continue as a going concern.  (Management's plans in regard to these
matters  are also described in Note 1.)  The financial statements do not include
any adjustments to reflect the possible future effects on the recoverability and
classification  of  assets or the amounts and classification of liabilities that
may  result  from  the  outcome  of  this  uncertainty.


July 28, 2000, except for Note 10
as to which the date is September 28, 2000.
Austin,  Texas

                                            /s/  Ernst  &  Young  LLP


                                      F-2
<PAGE>

GARDEN.COM,  INC.

BALANCE  SHEETS
JUNE  30,  2000  AND  1999
(in  Thousands)
---------------

<TABLE>
<CAPTION>

ASSETS                                                      2000      1999
                                                          --------  --------
<S>                                                       <C>       <C>
CURRENT ASSETS:
  Cash and cash equivalents. . . . . . . . . . . . . . .  $ 9,047   $15,340
  Investments. . . . . . . . . . . . . . . . . . . . . .   18,612     3,710
  Prepaid advertising. . . . . . . . . . . . . . . . . .    1,869       988
  Other prepaid expenses and current assets. . . . . . .    2,143     1,086
  Inventory. . . . . . . . . . . . . . . . . . . . . . .      898       522
                                                          --------  --------
Total current assets . . . . . . . . . . . . . . . . . .   32,569    21,646
                                                          --------  --------

PROPERTY AND EQUIPMENT:
  Equipment. . . . . . . . . . . . . . . . . . . . . . .      660       480
  Leasehold improvements . . . . . . . . . . . . . . . .      779       456
  Computers and software . . . . . . . . . . . . . . . .    9,537     2,111
  Furniture and fixtures . . . . . . . . . . . . . . . .      867       440
                                                          --------  --------
Total property and equipment . . . . . . . . . . . . . .   11,843     3,487

Accumulated depreciation . . . . . . . . . . . . . . . .   (2,697)     (828)
                                                          --------  --------
  Property and equipment, net. . . . . . . . . . . . . .    9,146     2,659

OTHER ASSETS:
  Net of accumulated amortization of $333 and $110 as of
    June 30, 2000 and 1999, respectively . . . . . . . .      780       917
                                                          --------  --------
TOTAL ASSETS:. . . . . . . . . . . . . . . . . . . . . .  $42,495   $25,222
                                                          ========  ========
</TABLE>

                             See accompanying notes.

                                      F-3
<PAGE>

GARDEN.COM,  INC.

BALANCE  SHEETS  (CONTINUED)
JUNE  30,  2000  AND  1999
(in  Thousands)
---------------

<TABLE>
<CAPTION>

LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)                                                          2000       1999
                                                                 ---------  ---------
<S>                                                              <C>        <C>
CURRENT LIABILITIES:
  Accounts payable. . . . . . . . . . . . . . . . . . . . . . .  $  4,282   $  2,052
  Accrued expenses and other liabilities. . . . . . . . . . . .     3,057        956
  Unearned revenue. . . . . . . . . . . . . . . . . . . . . . .       187        188
  Current portion of long-term debt . . . . . . . . . . . . . .        20        127
                                                                 ---------  ---------
Total current liabilities . . . . . . . . . . . . . . . . . . .     7,546      3,323
                                                                 ---------  ---------

Long-term debt, less current portion. . . . . . . . . . . . . .        --         20
  Redeemable convertible preferred stock. . . . . . . . . . . .        --     48,215
  Warrants to purchase redeemable convertible
    preferred stock . . . . . . . . . . . . . . . . . . . . . .        --         24

STOCKHOLDERS' EQUITY (DEFICIT):
  Common Stock--$.01 par value:  50,000 authorized, 17,737
    and 1,157 actual shares issued and outstanding on June 30,
    2000 and 1999, respectively . . . . . . . . . . . . . . . .       177         12
  Additional paid-in capital. . . . . . . . . . . . . . . . . .   104,499      5,768
  Deferred stock compensation . . . . . . . . . . . . . . . . .    (1,169)    (2,305)
  Retained deficit. . . . . . . . . . . . . . . . . . . . . . .   (68,558)   (29,835)
                                                                 ---------  ---------
Total stockholders' equity (deficit). . . . . . . . . . . . . .   34,949.    (26,360)
                                                                 ---------  ---------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
  (DEFICIT) . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 42,495   $25,222.
                                                                 =========  =========
</TABLE>

                             See accompanying notes.

                                      F-4
<PAGE>

GARDEN.COM,  INC.

STATEMENTS  OF  OPERATIONS
YEARS  ENDED  JUNE  30,  2000,  1999  AND  1998
(in  Thousands,  except  share  and  per  share  data)
<TABLE>
<CAPTION>

                                                                   2000         1999         1998
                                                               ------------  -----------  -----------
<S>                                                            <C>           <C>          <C>
REVENUES:
Products. . . . . . . . . . . . . . . . . . . . . . . . . . .  $    13,564   $    4,952   $    1,283
Advertising . . . . . . . . . . . . . . . . . . . . . . . . .        1,938          442           56
                                                               ------------  -----------  -----------
Total revenues. . . . . . . . . . . . . . . . . . . . . . . .       15,502        5,394        1,339
                                                               ------------  -----------  -----------

COST OF REVENUES:
Products. . . . . . . . . . . . . . . . . . . . . . . . . . .       11,416        4,466        1,086
Advertising . . . . . . . . . . . . . . . . . . . . . . . . .          205           74           22
                                                               ------------  -----------  -----------
Total cost of revenues. . . . . . . . . . . . . . . . . . . .       11,621        4,540        1,108
                                                               ------------  -----------  -----------

GROSS PROFIT: . . . . . . . . . . . . . . . . . . . . . . . .        3,881          854          231
                                                               ------------  -----------  -----------

OPERATING EXPENSES:
Marketing and sales . . . . . . . . . . . . . . . . . . . . .       26,654       13,305        2,411
Technology, content and product development . . . . . . . . .        6,918        3,167        1,188
General and administrative. . . . . . . . . . . . . . . . . .        7,052        2,941        1,218
Depreciation and amortization . . . . . . . . . . . . . . . .        2,107          610          219
Amortization of deferred compensation . . . . . . . . . . . .        1,136          674           73
Restructuring and other activities. . . . . . . . . . . . . .          888           --           --
                                                               ------------  -----------  -----------
Total operating expenses. . . . . . . . . . . . . . . . . . .       44,755       20,697        5,109
                                                               ------------  -----------  -----------

OPERATING LOSS: . . . . . . . . . . . . . . . . . . . . . . .      (40,874)     (19,843)      (4,878)

OTHER INCOME (EXPENSE):
Interest income . . . . . . . . . . . . . . . . . . . . . . .        2,158          804          227
Interest expense. . . . . . . . . . . . . . . . . . . . . . .           (7)         (20)         (33)
                                                               ------------  -----------  -----------
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . .  $   (38,723)  $  (19,059)  $   (4,684)
                                                               ============  ===========  ===========

Less:  Beneficial conversion feature and insubstance dividend           --       (2,700)          --
                                                               ------------  -----------  -----------

Net loss applicable to common stockholders. . . . . . . . . .  $   (38,723)  $  (21,759)  $   (4,684)
                                                               ============  ===========  ===========
Basic net loss per share. . . . . . . . . . . . . . . . . . .  $     (2.74)  $   (20.48)  $    (4.68)
                                                               ============  ===========  ===========

Shares used in computing basic net loss per share . . . . . .   14,149,167    1,062,696    1,000,820
                                                               ============  ===========  ===========
</TABLE>



                             See accompanying notes.

                                      F-5
<PAGE>
GARDEN.COM,  INC.

STATEMENTS  OF  CHANGES  IN  COMMON  STOCK  AND
STOCKHOLDERS'  EQUITY  (DEFICIT)
(in  Thousands)
---------------
<TABLE>
<CAPTION>
                                                                                                                      TOTAL
                                                                                                                    REDEEMABLE
                                                                                                                   CONVERTIBLE
                                                                                                                    PREFERRED
                                                                                               DEFERRED               STOCK
                                    REDEEMABLE CONVERTIBLE                          ADDITIONAL  STOCK                  AND
                                       PREFERRED STOCK           COMMON STOCK        PAID-IN    COMPEN-  RETAINED  STOCKHOLDERS'
                                SHARES    AMOUNT   WARRANTS   SHARES    PAR VALUE    CAPITAL    SATION    DEFICIT     EQUITY
<S>                            <C>       <C>       <C>        <C>      <C>          <C>        <C>       <C>        <C>
Balance at June 10, 1997. . .    4,158     7,879         23    1,160           12         29        --     (3,106)     4,837
Issuance of Series D
  Redeemable Convertible
  Preferred Stock and
  warrants, net of issuance
  costs of $1,177 . . . . . .    4,255    18,823          1       --           --         --        --         --     18,824
Dividends accrued for
  Series A, B, C Preferred
  Stock . . . . . . . . . . .       --        --         --       --           --         --        --       (286)      (286)
Conversion of cumulative
  dividend to Series D
  Redeemable Convertible
  Preferred Stock . . . . . .       58       273         --       --           --         --        --         --        273
Repurchase of Common
  Stock . . . . . . . . . . .       --        --         --     (160)          (2)       (26)       --         --        (28)
Deferred stock compensation .       --        --         --       --           --        313      (313)        --         --
Amortization of deferred
  compensation. . . . . . . .       --        --         --       --           --         --        72         --         72
Exercise of stock options . .       --        --         --        7            0          6        --         --          6
Net loss. . . . . . . . . . .       --        --         --       --           --         --        --     (4,684)    (4,684)
                               --------  --------  ---------  -------  -----------  ---------  --------  ---------  ---------

Balance at June 30, 1998. . .    8,471    26,975         24    1,007           10        322      (241)    (8,076)    19,014
Issuance of Series E
  Redeemable Convertible
  Preferred Stock, net of
  issuance costs of $1,398. .    3,166    21,240         --       --           --         --        --         --     21,240
Beneficial conversion feature
  and in substance dividend .       --        --         --       --           --      2,700        --     (2,700)        --
Deferred stock compensation .       --        --         --       --           --      2,738    (2,738)        --         --
Amortization of deferred
  compensation. . . . . . . .       --        --         --       --           --         --       674         --        674
Exercise of stock options . .       --        --         --      150            2          8        --         --         10
Net loss. . . . . . . . . . .       --        --         --       --           --         --        --    (19,059)   (19,059)
                               --------  --------  ---------  -------  -----------  ---------  --------  ---------  ---------

Balance at June 30, 1999. . .   11,637    48,215         24    1,157           12      5,768    (2,305)   (29,835)    21,879
                               ========  ========  =========  =======  ===========  =========  ========  =========  =========
Conversion of redeemable
  convertible preferred
  stock and warrants to
  common stock. . . . . . . .  (11,637)  (48,215)       (24)  11,637          116     48,123        --         --         --
Exercise of common stock
  warrants. . . . . . . . . .       --        --         --       69            1        213        --         --        214
Issuance of common stock,
  net of issuance costs
  of $2,071 . . . . . . . . .       --        --         --    4,650           46     49,766        --         --     49,812
Amortization of deferred
  compensation. . . . . . . .       --        --         --       --           --         --     1,136         --      1,136
Exercise of stock options . .       --        --         --       88            1         26        --         --         27
Stock issued to Employee
  Stock Purchase Plan . . . .       --        --         --      116            1        359        --         --        360
Acquisition of catalog assets       --        --         --       20            0        206        --         --        206
Common stock options
  issued to charitable
  organization. . . . . . . .       --        --         --       --           --         38        --         --         38
NET LOSS. . . . . . . . . . .       --        --         --       --           --         --        --    (38,723)   (38,723)

Balance at June 30, 2000. . .       --        --         --   17,737   $      177   $104,499   $(1,169)  $(68,558)  $ 34,949
                               ========  ========  =========  =======  ===========  =========  ========  =========  =========
</TABLE>

                             See accompanying notes.

                                      F-6
<PAGE>
GARDEN.COM,  INC.

STATEMENTS  OF  CASH  FLOWS
YEARS  ENDED  JUNE  30,  2000,  1999  AND  1998
(In  Thousands)
---------------
<TABLE>
<CAPTION>

                                                                            2000       1999       1998
                                                                          ---------  ---------  --------
<S>                                                                       <C>        <C>        <C>
OPERATING ACTIVITIES:
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $(38,723)  $(19,059)  $(4,684)
Adjustments to reconcile net loss to cash used in operating activities:
     Depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . .     1,884        517       219
     Amortization. . . . . . . . . . . . . . . . . . . . . . . . . . . .       223         93        --
     Amortization of deferred stock compensation . . . . . . . . . . . .     1,136        674        73
     Expense related to non-employee option issuance . . . . . . . . . .        38         --        --
Changes in operating assets and liabilities:
     Prepaid advertising . . . . . . . . . . . . . . . . . . . . . . . .      (881)      (610)     (374)
     Other prepaid expenses and current assets . . . . . . . . . . . . .    (1,057)    (1,039)        8
     Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      (376)      (364)     (134)
     Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . .       662       (738)       (7)
     Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . .     2,230      1,141       675
     Accrued expenses and other liabilities. . . . . . . . . . . . . . .     2,101        819        47
     Unearned revenue. . . . . . . . . . . . . . . . . . . . . . . . . .        (1)        92        80
                                                                          ---------  ---------  --------

Net cash used in operating activities. . . . . . . . . . . . . . . . . .   (32,764)   (18,474)   (4,097)
                                                                          ---------  ---------  --------

INVESTING ACTIVITIES:
     Proceeds from sale of investments . . . . . . . . . . . . . . . . .    31,065     11,083        --
     Purchase of investments . . . . . . . . . . . . . . . . . . . . . .   (45,967)   (14,792)       --
     Purchase of property and equipment. . . . . . . . . . . . . . . . .    (8,349)    (2,577)     (422)
     Purchase of other assets. . . . . . . . . . . . . . . . . . . . . .      (564)        (9)     (262)
                                                                          ---------  ---------  --------

Net cash used in investing activities. . . . . . . . . . . . . . . . . .   (23,815)    (6,295)     (684)
                                                                          ---------  ---------  --------

FINANCING ACTIVITIES:
     Proceeds from long-term debt. . . . . . . . . . . . . . . . . . . .        --         --       200
     Repayments of long-term debt. . . . . . . . . . . . . . . . . . . .      (127)      (182)     (115)
     Proceeds from issuance of common stock, net of issuance costs
        of $2,071) . . . . . . . . . . . . . . . . . . . . . . . . . . .    49,812         --        --
     Repurchase of common stock. . . . . . . . . . . . . . . . . . . . .        --         --       (28)
     Proceeds from issuance of Series D Redeemable Convertible
        Preferred Stock and warrants, net of issuance costs of $1,177. .        --         --    18,824
     Proceeds from issuance of Series E Redeemable Convertible
        Preferred Stock and warrants, net of issuance costs of $1,398. .        --     21,240        --
     Exercises of stock options. . . . . . . . . . . . . . . . . . . . .        27          9         6
      Proceeds from exercises of warrants. . . . . . . . . . . . . . . .       214         --        --
      Proceeds from common stock issued to Employee Stock Purchase
        Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       360         --        --
      Dividend paid on Series A, B and C Redeemable Convertible
        Preferred Stock. . . . . . . . . . . . . . . . . . . . . . . . .        --         --       (12)
                                                                          ---------  ---------  --------

Net cash provided by financing activities. . . . . . . . . . . . . . . .    50,286     21,067    18,875
                                                                          ---------  ---------  --------

CHANGE IN CASH AND CASH EQUIVALENTS. . . . . . . . . . . . . . . . . . .    (6,293)    (3,702)   14,094

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR . . . . . . . . . . . . . .    15,340     19,042     4,948
                                                                          ---------  ---------  --------

CASH AND CASH EQUIVALENTS, END OF YEAR . . . . . . . . . . . . . . . . .  $  9,047   $ 15,340   $19,042
                                                                          =========  =========  ========

SUPPLEMENTAL DISCLOSURES:
      Cash interest paid . . . . . . . . . . . . . . . . . . . . . . . .  $      7   $     22   $    31
                                                                          =========  =========  ========

     Beneficial conversion and insubstance dividend (see Note 6) . . . .        --   $  2,700        --
</TABLE>

                             See accompanying notes.

                                      F-7
<PAGE>
GARDEN.COM,  INC.

NOTES  TO  FINANCIAL  STATEMENTS
--------------------------------

1.   ORGANIZATION

     The  Company was originally incorporated in Texas on October 2, 1995 as The
Asbury  Group,  Inc. On November 30, 1995, The Asbury Group, Inc. incorporated a
wholly-owned  subsidiary,  Garden Escape, Inc., in Delaware.  Effective December
11,  1995,  The  Asbury  Group,  Inc.  was  merged into Garden Escape, Inc. in a
transaction  accounted  for  at  historical cost.  In February 1999, the Company
changed  its  name  to  Garden.com,  Inc.  The  Company is an online destination
integrating  gardening  and  gardening-related  commerce, content and community.
All  of  the  Company's  sales  are  conducted via its Web sites, garden.com and
virtualgarden.com.

     The Company has incurred recurring operating losses and negative cash flows
from  operations.  These  conditions raise substantial doubt about the Company's
ability  to continue as a going concern.  In regard to these matters, management
announced  a  corporate  restructuring  with  the  intent  of  lowering  ongoing
operating  expenses  and  reducing  future  capital  requirements,  reduced  its
workforce  on  September  28,  2000 by 93 employees and terminated or materially
amended  multiple  marketing  initiatives.  Additionally,  the  Company  also
announced  that  it had engaged the investment bank of Robertson Stephens to aid
the  Company in evaluating strategic alternatives and to assist the Company with
ongoing  fund-raising  efforts.

2.   SIGNIFICANT  ACCOUNTING  POLICIES

USE  OF  ESTIMATES

     The  preparation  of  financial  statements  in  conformity  with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect  the  amounts reported in the financial statements and
accompanying  notes.  Actual results could differ from those estimates, and such
differences  could  be  material  to  the  financial  statements.

REVENUE  RECOGNITION

     Revenues for products and shipping charges are recognized when the products
are  shipped  to  the  customer.  Substantially  all  product  sales are shipped
directly  from  various  product  suppliers  to the customer.  The Company takes
title  to all goods and, accordingly, has the risks and rewards of ownership for
such shipments.  Revenues are recorded net of promotional discounts and coupons.
Product  returns  are  recorded  as a reduction of revenues. The Company records
unearned  revenue  for  customer orders received and paid for that have not been
shipped.


                                      F-8
<PAGE>
     Advertising  revenues  consist  of  sponsorships,  banners  and  print
advertising.  Advertising revenues are recognized in proportion to the number of
impressions  delivered under each contract or proportionately over the period of
time covered by a contract if impressions are not used.  The Company has certain
contracts  under  which  it generates a minimum number of click-throughs and has
historically  met  these  guarantees.

CASH  AND  CASH  EQUIVALENTS

     Cash  and  cash  equivalents include cash on hand and marketable securities
with original maturities of three months or less.  Cash and cash equivalents are
recorded  at  cost,  which  approximates fair value due to the short maturity of
these  instruments.

INVESTMENTS

     Management  determines the appropriate classification of investments at the
time of purchase and reevaluates such designation as of each balance sheet date.
Investments  as  of  June  30,  2000  consisted  of high-grade commercial paper,
corporate  notes,  and  government  securities,  are  classified  as
available-for-sale,  and  are  reported  at cost, which approximates fair market
value,  using  the  specific  identification method, as of June 30, 2000. All of
these  securities  mature  within  one  year.

INVENTORY

     Inventory, which consists of finished goods, is stated at the lower of cost
or  market,  with  cost  determined  using  the  average  cost  method.

PROPERTY  AND  EQUIPMENT

     Property and equipment are stated at cost less accumulated depreciation and
amortization.  Depreciation  of  property  and  equipment is based on the useful
lives  of  the assets, generally three to seven years, and is computed using the
straight-line method.  Amortization of leasehold improvements is computed on the
straight-line  method  over  estimated  useful  lives or lease terms if shorter.

OTHER  PREPAID  ASSETS  AND  OTHER  ASSETS

     Other prepaid assets and other assets include certain prepaid assets, trade
accounts  receivable, advertising trade accounts receivable, deposits, goodwill,
and  the  cost  of  a  web  site  which  are  carried  at  cost less accumulated
amortization.  Amortization  of  the  intangible other assets is computed on the
straight-line  method  over their estimated useful lives of three to four years.


                                      F-9
<PAGE>
LONG-LIVED  ASSETS

     The  Company  reviews  for  the impairment of long-lived assets and certain
identifiable  intangibles  whenever  events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable.  An impairment loss
would be recognized when estimated future cash flows expected to result from the
use  of the asset and its eventual disposition is less than its carrying amount.
No  such  impairment  losses  have  been  identified  by  the  Company.

INTERNAL  USE  SOFTWARE

     In accordance with Statement of Position 98-1 ("SOP 98-1"), "Accounting for
the  Costs  of  Computer  Software  Developed  or Obtained for Internal Use" the
Company  has  capitalized  certain  internal  use  software.  The  Company  is
developing  a  number  of  new  software  applications, including a new commerce
platform,  and  the  Company's  updated proprietary supplier information system,
TRELLIS.  External  direct  costs  of materials and services and payroll related
costs  of  employees  working  solely  on  development of these applications are
capitalized.  Capitalized  costs  will  be depreciated when the applications are
placed in service on the straight-line method over a three year estimated useful
life.

ADVERTISING  COSTS

     The  cost  of  advertising  is  expensed as incurred.  For the fiscal years
ended June 30, 2000, 1999 and 1998, the Company incurred advertising expenses of
$18,726,000,  $10,763,000  and  $1,364,000,  respectively.

CONTENT  LICENSES

     The Company licenses certain content from third party providers and records
these  expenditures  as  incurred.

INCOME  TAXES

     Income  taxes  are  accounted  for  under Statement of Financial Accounting
Standards  ("SFAS")  No. 109, "Accounting for Income Taxes." Under SFAS No. 109,
deferred  tax assets and liabilities are determined based on differences between
financial  reporting  and  tax basis of assets and liabilities, and are measured
using the enacted tax rates and laws that will be in effect when the differences
are  expected  to  reverse.

ACCOUNTING  FOR  STOCK-BASED  COMPENSATION

     The  Company  has  elected  to account for stock-based compensation expense
under  APB  No.  25,  "Accounting  for  Stock Issued to Employees," and make the
required pro forma disclosures for compensation as required by SFAS No. 123. The
Company  uses  the  intrinsic  value  method  in  accounting for its stock-based
employee  compensation  plans.


                                      F-10
<PAGE>
NET  LOSS  PER  SHARE

     Basic  net  loss  per  share  is computed by dividing net loss available to
common  stockholders by the weighted average number of common shares outstanding
during  the  period.  Shares  associated  with  stock options and the redeemable
convertible  preferred  stock  are  not  included because they are antidilutive.
Effective upon the closing of the Company's initial public offering on September
21, 1999, all shares of the redeemable convertible preferred stock automatically
converted  into  Common  Stock  and  are included in the calculation of weighted
average  number  of  shares  as  of  that  date.

COMPREHENSIVE  LOSS

     The  Company  has  adopted  SFAS No. 130, "Reporting Comprehensive Income,"
which  establishes standards for the reporting and display of comprehensive loss
and  its  components in the financial statements.  The Company does not have any
components  of  comprehensive  income  or  loss.

SEGMENTS

     The  Company  continues  to  consider  its  business activities as a single
segment.

RISKS  AND  UNCERTAINTIES

     For  the  year  ended  June  30,  2000,  one  supplier's products generated
approximately  12%  of  the  Company's  revenue.

RECLASSIFICATIONS

     Certain  amounts  in  previously  issued  financial  statements  have  been
reclassified  to  conform  to  the  fiscal  year  2000  presentation.

RECENT  ACCOUNTING  PRONOUNCEMENTS

     In  December  1999,  the  Securities  and  Exchange Commission issued Staff
Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements" ("SAB
101")  which  addresses  certain  criteria  for revenue recognition. SAB 101, as
amended  by  SAB  101A  and SAB 101B, outlines the criteria that must be used to
recognize  revenue  and  provides  guidance  for  disclosures related to revenue
recognition policies. The adoption of SAB 101 is not expected to have a material
impact  on  the  consolidated  financial  position  or  results  of  operations.

     On March 31, 2000 the Financial "Accounting Standards Board ("FASB") issued
Interpretation  No.  44,  "Accounting  for  Certain Transactions Involving Stock
Compensation,"  (the  "Interpretation").  The  Interpretation  provides guidance
related to the implementation of APB No. 25. The Interpretation is to be applied
prospectively to all new awards, modifications to outstanding awards and changes
in  employee  status  on  or  after  July  1,  2000.  For  changes  made

                                      F-11
<PAGE>
after December 15, 1998 to awards that affect exercise prices of the awards, the
Company  must  prospectively account for the impact of those changes. Management
does  not believe the adoption of the Interpretation will have a material impact
on  the  Company's  financial  condition  or  results  of  operations.

     In  June  1999,  SFAS  No.  137, "Accounting for Derivative Instruments and
Hedging  Activities,  Deferral of Effective Date of FASB Statement No. 133," was
issued  which requires that Statement No. 133 be adopted in the Company's fiscal
year  2001.  Management  does  not anticipate that the adoption of Statement No.
133  will  have  a  material  effect  on  the results of operations or financial
position because the Company's does not currently engage in or plan to engage in
derivative  or  hedging  activities.

3.     LONG-TERM  DEBT

Long-term  debt  consists  of  the  following  (in  thousands):

<TABLE>
<CAPTION>

                                                    JUNE 30,
                                                    --------
                                                  2000    1999
                                                 ------  ------
<S>                                              <C>     <C>
Line of credit term note payable to a bank
  due October 14, 2000, payable in monthly
  installments of $7 with interest at the
  prime rate plus 1% (8.89% at June 30,
  2000), collateralized by the assets of the
  Company. . . . . . . . . . . . . . . . . . .   $  20    $107
Line of credit term note payable to a bank
  due December 14, 1999, payable in
  monthly installments of $8 with interest at
  the prime rate plus 1% (9.04% at June 30,
  1999), collateralized by the assets of the
  Company. . . . . . . . . . . . . . . . . . .      -       41
                                                 ------  ------
Total long-term debt . . . . . . . . . . . . .      20     148
Less current portion . . . . . . . . . . . . .     (20)   (128)
                                                 ------  ------
Long-term debt, net of current portion . . . .     $ -     $20
                                                 ======  ======
</TABLE>

     As  of  June  30, 2000 and 1999, all of the Company's outstanding long-term
debt  had  a  variable  interest rate, and accordingly, the Company believes the
carrying  value of the long-term debt approximates its fair value. No additional
amounts  were  available  to be drawn under these lines of credit as of June 30,
2000.

4.     INCOME  TAXES

     As  of  June  30, 2000, the Company had net operating loss carryforwards of
approximately  $67,018,000  and research and development credit carryforwards of
approximately  $105,000.  The  net  operating  loss  carryforwards will begin to
expire  in  2011,  if  not  utilized.  The  research  and  development  credit
carryforwards  will  begin  to  expire  in  2012,  if  not  utilized.


                                      F-12
<PAGE>
     Utilization  of the net operating loss and tax credit carryforwards will be
subject  to  a  substantial  annual  limitation due to the "change in ownership"
provisions  of  the  Internal  Revenue  Code  of  1986,  as amended.  The annual
limitation  may result in the expiration of net operating losses and tax credits
before  utilization.

     Deferred  income taxes reflect the net tax effects of temporary differences
between  carrying  amounts  of  assets  and  liabilities for financial reporting
purposes  and  the  amounts  used  for  income  tax  purposes.

     Significant components of the Company's deferred tax liabilities and assets
are  as  follows  (in  thousands):
<TABLE>
<CAPTION>


                                                 JUNE 30,   JUNE 30,
                                                   2000       1999
                                                 ---------  --------
<S>                                              <C>        <C>
Deferred tax liabilities:
   Depreciable assets . . . . . . . . . . . . .  $    691   $    --
                                                 ---------  --------
   Prepaid expenses and other . . . . . . . . .       806   $   460
                                                 ---------  --------
   Total deferred tax liabilities . . . . . . .     1,497       460
                                                 ---------  --------

Deferred tax assets:
   Depreciable assets . . . . . . . . . . . . .        --        70
                                                 ---------  --------
   Accrued liabilities and other. . . . . . . .       268        53
                                                 ---------  --------
   Tax carryforwards. . . . . . . . . . . . . .    24,901    10,035
                                                 ---------  --------

Total deferred tax assets . . . . . . . . . . .    25,169    10,158
                                                 ---------  --------

Net deferred tax assets . . . . . . . . . . . .    23,672     9,698
                                                 ---------  --------
Valuation allowance for net deferred tax assets   (23,672)   (9,698)
                                                 ---------  --------

Net deferred taxes. . . . . . . . . . . . . . .  $     --   $    --
                                                 =========  ========
</TABLE>

     The Company has established a valuation allowance equal to the net deferred
tax  asset due to uncertainties regarding the realization of deferred tax assets
based  on  the  Company's  lack  of  earnings  history.  The valuation allowance
increased  by  approximately  $13,974,000  during  the year ended June 30, 2000.
Approximately  $154,000  of  the  valuation  allowance  for  deferred tax assets
relates  to  benefits  for stock option deductions, which when realized, will be
allocated  directly  to  contributed  capital.


                                      F-13
<PAGE>
     The  Company's  provision  (benefit)  for  income  taxes  differs  from the
expected tax expense (benefit) amount computed by applying the statutory federal
income  tax  rate  of  34%  to  income  before  income  taxes as a result of the
following:
<TABLE>
<CAPTION>

                                     FISCAL YEAR ENDED
                                         JUNE  30,
                                     -----------------
                                       2000     1999
                                     --------  -------
<S>                                  <C>       <C>
Federal statutory rate. . . . . . .   (34.0)%  (34.0)%
State taxes, net of federal benefit    (3.0)    (3.0)
Change in valuation allowance . . .    36.1     36.0
Other . . . . . . . . . . . . . . .     0.9      1.0
                                     --------  -------

Effective tax rate. . . . . . . . .     0.0%     0.0%
                                     ========  =======
</TABLE>

5.     COMMITMENTS

     Future minimum payments under all operating leases as of June 30, 2000, are
as  follows:
<TABLE>
<CAPTION>

<S>                <C>
Fiscal year ended
June 30,
2001. . . . . . .  $269,516
2002. . . . . . .   232,641
2003. . . . . . .     7,560
                   --------
Total . . . . . .  $509,717
                   ========
</TABLE>

     Rent  expense for the three fiscal years ended June 30, 2000, 1999 and 1998
was approximately $280,000 (offset by sublease income of $108,000), $195,000 and
$114,000,  respectively.  Future  minimum  rental  income  from  non-cancelable
subleases  consists  of  approximately $41,000 for the year ended June 30, 2001.

     In  addition,  the  Company  has  entered into strategic relationships with
several  Internet portals, including arrangements with iVillage and Excite.  The
agreements  with  iVillage and Excite call for Garden.com to provide and sponsor
gardening  content  on the respective Web sites. Under terms of these agreements
the Company is required to make certain installment payments, which are expensed
as  advertising  expense  as  incurred.

     Garden.com  and  Administaff  Company  Inc.  are parties to a co-employment
agreement,  as  amended  July 1, 1997, pursuant to which Administaff administers
some  of  the  benefits  plans of Garden.com.  This arrangement is terminable by
either  party  upon  30  days  prior  written  notice.


                                      F-14
<PAGE>
6.     CAPITAL  STRUCTURE

Redeemable  Convertible  Preferred  Stock

     Upon  the  close  of the Company's initial public offering on September 21,
1999  all  shares  of  redeemable  convertible preferred stock were converted to
common  stock.  The  five  series  of  redeemable  convertible  preferred  stock
designated  as  of  June  30,  1999,  were  as  follows:
<TABLE>
<CAPTION>

                                                       SHARES ISSUED    CONSIDERATION PER
                                                            AND         SHARE RECEIVED IN
                        PAR VALUE   SHARES AUTHORIZED    CONVERTED          ISSUANCE
                        ----------  -----------------  -------------  -----------------------
<S>                     <C>         <C>                <C>            <C>
Redeemable convertible
   preferred stock
   Series A. . . . . .  $     0.01            750,000        599,998  $             1.25 cash
   Series B. . . . . .        0.01          1,430,000      1,144,000  $             1.75 cash
   Series C. . . . . .        0.01          4,444,138      2,413,791  $             2.18 cash
   Series D. . . . . .        0.01          5,482,330      4,313,514  $             4.70 cash
   Series E. . . . . .        0.01          4,402,731      3,166,094  $7.15 cash and services
                                    -----------------  -------------
                                           16,509,199     11,637,397
                                    =================  =============
</TABLE>

     In  connection  with  the  issuance  of  Series  B  Redeemable  Convertible
Preferred  Stock,  the  Company issued 160,000 shares of common stock to certain
holders  of  the Series B Redeemable Convertible Preferred Stock.  The agreement
under  which  they  were issued stipulated that the Company could repurchase the
common  shares  from  the  holders  at the issuance price ($1.75) if the Company
completed  a  qualified  financing  or  sale  prior  to August 31, 1998.  As the
Company  met  this  requirement,  the  shares  were  repurchased.

     Beginning on January 1, 1998, the Series A, B, and C Redeemable Convertible
Preferred  Stock  accrued  annual dividends equal to 8% of the original purchase
price  paid  per  share.  In  connection  with  the  Series  D  financing,  the
stockholders  elected  to  terminate  their  right  to receive future cumulative
dividends.  Through  a  noncash  financing  transaction,  $285,893  of  accrued
dividends,  approximately  $0.05 per share, were converted into 58,211 shares of
Series  D  Preferred Stock based on the accrued amount through June 5, 1998.  In
addition,  cash  dividends of $12,304 were paid based on the accrued amount from
June  5,  1998  through  June  11,  1998,  the  date  of  the Series D issuance.

     The  699,300 shares of Series E Preferred Stock that were sold to a related
party  were  accounted  for  as having a beneficial conversion feature which was
deemed  to  approximate  $2.7  million.  This  amount  was  accounted  for as an
increase  in  additional  paid  in  capital  and  an insubstance dividend to the
related  preferred  shareholders.


                                      F-15
<PAGE>
WARRANTS

     In  connection with the prior issuances of redeemable convertible preferred
stock,  the  Company  at  various  times  issued  warrants to purchase shares of
redeemable  convertible  preferred  stock  exercisable  at  prices  equal to the
respective  series'  per  share  price. The warrants transferred to common stock
rights upon the close of the Company's initial public offering. Of the warrants,
rights  to  29,370  and  39,774 shares were exercised during fiscal year 2000 at
$7.15 and $2.18 per share, respectively. The Company has reserved 515,323 shares
of  Common Stock for issuance upon conversion of the remaining warrants.  Of the
remaining common stock rights, 442,983 with an exercise price of $2.18 expire on
May  7,  2002  and 72,340 with an exercise price of $4.70 expire on December 31,
2002.

Stock  Options

     The  Company  has  a  stock option plan whereby options for the purchase of
shares  of  the  Company's common stock may be granted to its employees.  During
fiscal  year  ended  June  30,  2000,  the maximum number of options that may be
granted  through  the  plan  was increased from 1,360,000 to 2,500,000 effective
September  1999 and from 2,500,000 to 3,400,000 effective May 2000.  The Company
has  reserved  3,400,000  shares of common stock for issuance upon conversion of
the  options  as  of  June  30,  2000.  The  shares of common stock reserved for
issuance  under  the  stock  option plan automatically increase each year on the
first day of the Company's fiscal year beginning July 2000 in an amount equal to
the  lesser of (i) 1,200,000 shares, (ii) 5% of the outstanding shares of common
stock  on  such  date,  and  (iii) any lesser number of shares determined by the
Board  of  Directors.

     The  following represents a summary of the Company's stock option activity,
and  related  information:
<TABLE>
<CAPTION>

                                                           WEIGHTED   WEIGHTED
                                                            AVERAGE    AVERAGE
                               NUMBER OF     PRICE PER     EXERCISE     FAIR
                                SHARES         SHARE         PRICE      VALUE
                              -----------  --------------  ---------  ---------
<S>                           <C>          <C>             <C>        <C>
Outstanding at June 30, 1997     343,600     0.01 to 0.11       0.08
  Granted below fair value .     211,600     0.01 to 0.94       0.25       1.69
  Exercised. . . . . . . . .      (6,560)    0.01 to 0.21       0.06
  Canceled . . . . . . . . .     (18,640)    0.01 to 0.21       0.13
                              -----------  --------------  ---------
Outstanding at June 30, 1998     530,000     0.01 to 0.94       0.15
  Granted below fair value .     797,200    0.94 to 12.50       4.71       8.04
  Exercised. . . . . . . . .    (150,200)    0.01 to 0.94       0.06
  Canceled . . . . . . . . .     (19,120)    0.01 to 7.15       1.63
                              -----------  --------------  ---------
Outstanding at June 30, 1999   1,157,880    0.01 to 12.50  $    3.26
                              ===========  ==============  =========
  Granted. . . . . . . . . .   1,130,000    2.63 to 18.88       8.71  $    4.78
  Exercised. . . . . . . . .     (87,894)    0.01 to 3.75       0.33
  Canceled . . . . . . . . .    (213,410)   0.01 to 13.00       6.95
                              -----------  --------------  ---------
Outstanding at June 30, 2000   1,986,576   $0.01 to 18.88  $    6.04
                              ===========  ==============  =========
</TABLE>

                                      F-16
<PAGE>
     The  Company recorded deferred compensation for the fiscal years ended June
30,  2000  and  1999  of  $0  and $2,738,777, respectively.  The amount recorded
represents  the difference between the option price and the deemed fair value of
the  Company's  Common  Stock  for  shares  subject  to  options  granted.  The
amortization  of  deferred  compensation  will be charged to operations over the
vesting  period  of  the  options,  which  is  typically  five  years.  Total
amortization  recognized  was  $1,174,218,  $673,990  and $72,730 for the fiscal
years  ended  June  30,  2000,  1999  and  1998,  respectively.

     The  following  table  summarizes  outstanding  options at June 30, 2000 by
price  range:
<TABLE>
<CAPTION>

                              OUTSTANDING                                      EXERCISABLE
-----------------------------------------------------------------------  ---------  ---------------
                                 WEIGHTED-         WEIGHTED-AVERAGE                    WEIGHTED-
NUMBER OF       RANGE OF          AVERAGE       REMAINING CONTRACTUAL    NUMBER OF      AVERAGE
OPTIONS      EXERCISE PRICE   EXERCISE PRICE   LIFE OF OPTIONS IN YEARS   OPTIONS   EXERCISE PRICE
-----------  ---------------  ---------------  ------------------------  ---------  ---------------
<S>          <C>              <C>              <C>                       <C>        <C>
110,120 . .  $  0.01 to 0.01  $          0.01                       6.1     70,680  $          0.01
159,360 . .     0.18 to 0.21             0.21                       7.5     39,240             0.21
237,120 . .     0.94 to 0.94             0.94                       8.3     39,435             0.94
153,796 . .     2.63 to 3.88             3.34                       9.4     14,666             3.75
121,300 . .     4.00 to 6.00             5.26                       6.4     50,000             6.00
906,130 . .     6.13 to 9.13             7.43                       9.3     75,080             7.12
288,250 . .    9.53 to 14.13            12.25                       9.3      1,840            12.50
10,500. . .   16.00 to 18.88            16.50                       9.3         --               --
-----------  ---------------  ---------------  ------------------------  ---------  ---------------
1,986,576 .  $ 0.01 to 18.88  $          5.96                       8.7    290,941  $          3.30
===========  ===============  ===============  ========================  =========  ===============
</TABLE>

     Pro  forma information regarding net income (loss) per share is required by
Statement  No. 123, which also requires that the information be determined as if
the  Company  has accounted for its employee stock options granted subsequent to
June 30, 1995 under the fair value method of that Statement.  The fair value for
these  options  was  estimated at the date of grant using a minimum value option
pricing  model  with  the following weighted-average assumptions for fiscal year
1999  and  1998:  weighted-average  risk free interest rate was 5.5%, a dividend
yield  of  0%, a volatility factor of the expected market price of the Company's
common stock of near zero, and a weighted-average expected life of the option of
five  years.   For  fiscal  year 2000 the Black-Scholes method was used with the
following  assumptions:  weighted-average  risk  free  interest rate of 6.21%, a
dividend yield of 0%, a volatility factor of .90 and a weighted-average expected
life  of  four  years.

     Had  compensation  cost for the Company's stock option plan been determined
consistent with the fair value method as required by SFAS 123, the Company's net
loss  and  net  loss  per  share would have been $(39.9) million and $(2.82) per
share,  respectively.

     For  pro  forma  disclosure  purposes,  the  estimated  fair  value  of the
Company's  employee stock options is treated as if amortized to expense over the
options'  vesting  period,  therefore  the  effects of applying SFAS 123 for pro
forma  disclosures  are  not  necessarily  indicative  of  future  amounts.


                                      F-17
<PAGE>
7.     NET  LOSS  PER  SHARE

     The  following table sets forth the computation of basic net loss per share
for  the  periods  indicated:
<TABLE>
<CAPTION>

                                                                   FISCAL YEAR ENDED,
                                                                        JUNE 30,
                                                                        --------
                                                     (IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
                                                     ----------------------------------------------
                                                           2000           1999            1998
                                                     ---------------  --------------  -------------
<S>                                                  <C>              <C>             <C>
Numerator:
  Net loss. . . . . . . . . . . . . . . . . . . . .  $      (38,723)  $     (19,059)  $     (4,684)
    Less:  Beneficial conversion feature and
      in-substance dividend . . . . . . . . . . . .              --          (2,700)            --
                                                     ---------------  --------------  -------------
Net loss applicable to common shareholders. . . . .  $      (38,723)  $     (21,759)  $     (4,684)
                                                     ===============  ==============  =============

Denominator:
  Weighted average shares . . . . . . . . . . . . .      14,149,167       1,062,696      1,152,468
    Less:  contingently issuable shares-issued with
      Series B Preferred Stock and subject to
      repurchase. . . . . . . . . . . . . . . . . .              --              --       (151,648)
                                                     ---------------  --------------  -------------

Denominator for basic calculation . . . . . . . . .      14,149,167       1,062,696      1,000,820
                                                     ===============  ==============  =============

Net loss per share
  Basic . . . . . . . . . . . . . . . . . . . . . .  $        (2.74)  $      (20.48)  $      (4.68)
                                                     ===============  ==============  =============
</TABLE>

8.     RELATED  PARTIES

     The  Company  incurred  expenses  of  $61,752,  $32,343 and $27,552 for the
fiscal  years  ended  June  30,  2000,  1999  and  1998, respectively, for legal
services  to  Kenneth  Sharples,  the brother of the Company's President.  These
expenses were primarily for intellectual property legal issues.  In addition, at
various dates prior to the fiscal year ended June 30, 1999 the Company issued to
Kenneth  Sharples  options  to  purchase  6,400  shares  of  common  stock  at a
weighted-average  purchase  price  of  $0.93  per  share.

     The  E.W.  Scripps  Company, through its wholly owned subsidiaries, Scripps
Ventures  LLC  and  Scripps  Howard  Broadcasting  Company  d/b/a  Home & Garden
Television  ("HGTV"), beneficially owns 13.6% of the outstanding common stock as
of  August  31, 2000 of Garden.com.  Douglas R. Stern, a director of Garden.com,
is  the  President  and  Chief  Executive  Officer  of United Media, a newspaper
syndication  company  and  wholly-owned  subsidiary of The E.W. Scripps Company.

     On  May  24, 1999, 699,300 shares of the Company's Series E Preferred Stock
were  purchased  by  HGTV for a total purchase price of $5,000,000, or $7.15 per
share.  Approximately  $1,500,000  of the purchase price was paid in the form of
an advertising credit, of which the Company has used approximately $1,243,000 as
of  June  30,  2000.


                                      F-18
<PAGE>
     Beginning in March 1998, the Company conducted a national marketing program
with  United  Media.  The  agreement with United Media was terminated during the
fiscal  year  ended  June  30,  2000.

     The  Company made payments of approximately $2,500, $130,000 and $75,000 to
affiliates  of  The  E.W. Scripps Company during the fiscal years ended June 30,
2000,  1999  and  1998, respectively for services related to marketing and sales
expenses  and  the  third-party  syndication of the Company's content offerings.

     The Company maintains test gardens in Des Moines, Iowa on property owned by
Douglas  A.  Jimerson,  Vice  President  of  Publishing and Editor-in-Chief. The
Company  pays for the plants grown in the gardens and for the maintenance of the
gardens.  Other  than  these  maintenance expenses, the Company does not pay Mr.
Jimerson  rent  for  the  use  of  the  gardens.

9.     RESTRUCTURING  AND  OTHER  ACTIVITIES

     On  January  21,  2000  the  Company  acquired from a third party all owned
assets, including inventory, related to the production of a catalog.  The assets
were purchased through both cash payments and the issuance of common stock.  The
excess  of  the  purchase price over inventory value was attributed to goodwill.

     In  June  2000,  the  Company's management initiated a restructuring effort
that  resulted in the Company incurring a restructuring charge of $888,000. This
charge  includes asset write-offs on discontinued Company initiatives, including
prepaid  costs  for a landscaping product test, severance related to an internal
restructuring  and  a  note  receivable from a European based internet gardening
company.

10.     SUBSEQUENT  EVENTS

     On  July 21, 2000 the Company issued an employee stock grant of 1.4 million
shares  as  approved  by  the  Company's Board of Directors. The options have an
exercise  price  equal  to  the  closing price for the Company's publicly traded
common  shares  on the date of the option grant, or $1.75 per share. The options
have  a  vesting period of four years beginning on the date of the option grant.

     On September 28, 2000, the Company announced a corporate restructuring (the
"Restructuring Plan") with the intent of lowering ongoing operating expenses and
reducing  future  capital  requirements.  It  is expected that the Restructuring
Plan  will  cost the Company between $2.5 million and $2.8 million.  Pursuant to
the  Restructuring Plan, the Company reduced its workforce on September 28, 2000
by  93  employees.  In  addition,  the  Company terminated or materially amended
multiple  marketing  initiatives,  including  the  Company's  relationships with
iVillage,  Excite  and  PRIMEDIA, resulting in both write-offs of prepaid assets
and  cash  payments  to  third  parties  to  discontinue  certain  contractual
obligations.

     Simultaneous  with  its announcement of the Restructuring Plan, the Company
also  announced that it had engaged the investment bank of Robertson Stephens to
aid  the  Company in evaluating strategic alternatives and to assist the Company
with  ongoing  fund-raising  efforts.


                                      F-19