Packable was getting ready to go public a year ago. According to internal documents reviewed by CNBC, Packable is laying off staff and preparing to liquidate due to the economic downturn.
Packable is the parent company of pharmapacks. Before it turned to the internet and established a big home on Amazon, pharmapacks was a single brick and mortar pharmacy in the Bronx.
In September of last year, pharmapacks was the top seller on Amazon in the U.S., but it is now fifth among the site's top sellers.
In a notice to employees Monday, Packable said it was laying off 138 people, or 20% of its staff, with the remaining 372 employees expected to be terminated. Leanna Bautista is the company's Chief People Officer.
Packable couldn't get new financing that would have allowed it to stay in business.
The company said that internal and external financing options were not successful. We are forced to shut down the business, including the facility you report to, due to the company's lack of viable financing alternatives.
Packable received funding from a number of high-profile investors. Walmart, eBay, and Target are some of the marketplaces the company sells on.
According to an investor presentation, Amazon was Packable's largest channel as of 2020. More than half of online retail sales are now accounted for by Amazon's third-party marketplace. Many retailers rely on Amazon for the majority of their business because of the company's global reach and huge customer base.
Packable's last year has been a roller coaster. The market started to turn after Highland Transcend Partners I Corp. announced in September that it would be merging with a SPAC.
Packable canceled the deal to take the company public just days before Highland Transcend's shareholders were due to meet. According to the company's website, Packable CEO Andrew Vagenas resigned in April and was replaced by DanielMyers. A former supply chain executive was named to Packable's board. Vagenas is on the company's board.
The market dried up completely in July and not a single SPAC was issued. More than 600 SPACs hunted for targets in the two years that followed.
The disappearance of capital was a dramatic turn for a business that boomed after the Covid-19 epidemic. With consumers stuck at home, online spending went up.
According to an investor presentation, the company struggled to navigate supply-chain constraints which resulted in significant inventory out of stock, purchase order delays, and delays in onboarding new customers.
The business was able to grow through the early part of the 21st century. Packable said in February that its average daily revenue in January was an estimated $1.6 million, an increase from the fourth quarter of the previous year.
The representatives from Packable did not respond to the request for comment.
There is a lot of hype in the space.
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