Here’s Why Nobody Wants To Buy Birchbox, Even After VCs Spent $90 Million
Katia Beauchamp, Birchbox’s CEO, has been on the road, trying to find a buyer for her company and hitting up everyone from Walmart to QVC. After months of talks, they each ultimately declined. This week, Recode reported that Viking–a global investment firm that manages $25 billion in capital and is one of Birchbox’s existing investors–has agreed to invest $15 million in the company, thereby acquiring a majority stake. With this deal, Viking will effectively wipe out Birchbox’s other investors, including top firms like Accel Partners and First Round Capital, which will now walk away with nothing. It’s a major turn for Birchbox, which was launched to much fanfare in 2010, raised nearly $90 million in financing, and was once valued at half a billion dollars.Some of Birchbox’s struggles became apparent over the last two years, when the company conducted two rounds of layoffs, resulting in 15% of the staff being fired. At the time, Beauchamp said that these cuts were necessary because the company needed to become profitable, a goal she said Birchbox achieved last year. Read more at Fast Company.
