Failing flash-sale, e-commerce company Fab.com is kind of going out of business, Forbes reported.
Fab.com CEO Jason Goldberg sent out the following email, cited by Forbes:
“We recently announced that we will be launching and spinning out Hem as a new online furnishings brand. Hem combines Fab, our recent acquisitions of One Nordic, and our EU custom furniture business to create a new vertically integrated furnishings company that will create original, timeless furniture and interior accessories together with the most exciting and talented designers of today. Given that announcement, we have had a lot of inbound interest in the valuable Fab brand and assets. We are currently evaluating such inquiries. We have no comment on the status of those discussions.”
Goldberg added: ”As point of fact, we are not shopping Fab around and we have not hired any bankers or agents.”
Forbes estimates the company will sell for $100-$150 million.
That’s a dramatic drop from the valuation slapped on
A year ago, after Goldberg raised $150 million in a Series D round led by Andreessen Horowitz and China Internet giant, Tencent, Fab.com’ss valuation was $1 billion.
Forbes suggests the site’s fall from grace began after Alibaba decided to pass on investing in it. And Alibaba usually doesn’t pass on anything that moves.
Turns out Alibaba was right. For some reason, Goldberg decided Fab.com shouldn’t be doing flash sales any more, and switched to steak and potato e-commerce. This ended with cofounder Bradford Shellhammer resigning, and COO Beth Ferreira getting sacked, along with half the employees.
Now Fab.com costs less to run, which Goldberg, obviously, thinks will look good to potential buyers.