Andre Yoskowitz
15 Dec 2015 21:08
Internet flash sale retailer Gilt Groupe is preparing to sell itself for $250 million, under a quarter of what it was valued in 2011.
In 2011, venture capitalists placed a valuation of $1.1 billion on the company, which was seeing exponential growth at the time.
Even more upsetting for investors is the fact that Gilt has raised $280 million in capital since 2007, suggesting most investors will lose on this deal. Hudson Bay Co., the owner of Saks Fifth Avenue, is the likely buyer.
In 2014, the company had $600 million in revenue and Hudson Bay plans to pair Gilt with its own Saks Off 5th brand discount site and stores, with the potential for Gilt popup shops.
Other flash sale sites have also struggled post-recession, as major retailers have made discounts the "norm" and popularity has waned significantly.
Source:
WSJ