How the mighty have fallen. And how fast.
Just last summer Fab, an ecommerce startup, was riding high. Founded in 2010 as a social-network before pivoting into the online retail space, Fab experienced explosive growth. In June 2013, the company raised $150 million in venture capital at a $1 billion valuation.
Less than a year later, in what is only the latest round of drastic cutbacks, the company says it will lay off between 80 and 90 people at its New York office, or about a third of its global staff.
Related: Why Fab Is Bleeding
How did it come to this?
Growing pains emerged as early as 2012, when Fab missed its revenue target of $140 million, but the real trouble began in April 2013 when the company announced it was transitioning away from a flash-sale model in order to become a more traditional online retailer. At the time, CEO and co-founder Jason Goldberg said he wanted Fab to become "the world's No. 1 design store" and compete with Amazon and Ikea.
The ambitious pivot set off waves of layoffs. In July 2013, just a month after its $1 billion valuation, the company cut more than 100 jobs. October of that same year, 100 additional employees were let go and dozens more lost their jobs the following month.
After the layoffs, executives fled: the company lost its chief people officer, chief operating officer, and chief financial officer in quick succession. The biggest blow, however, was co-founder and chief design officer Bradford Shelhammer's decision to quit the company he helped start in November of last year.
Despite these setbacks, Goldberg has passionately come to his company's defense, often taking to his blog to discuss the layoffs and restructuring. “No doubt we had lost perspective at Fab. We had started to dream in billions when we should have been focused on making one day simply better than the one before it," he wrote in January.
This April, he published a post titled " It's a f-cking startup. Why are you here?," which acknowledged the company's precarious situation. "Are we out of the woods yet? No," he wrote. "Do we know how to get there? Sorta. We're still figuring it out," adding "we're fighting for our lives."
Fab recently launched an exclusive line of furniture and opened a showroom in SoHo. "Realigning our team is part of a broader business plan, which we began implementing last fall and which will continue to unfold in weeks ahead," the company said in a statement. "We have every confidence in our path ahead."
Perhaps. But it's a worrying sign that Goldberg has deactivated his blog. Click on a link that once led to a passionate, explicative laden rallying cry, and you're now met with the words: "There's nothing here."
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