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Daily Daze

Daily Daze

Layoffs Underway at Gilt Groupe Right Now: ‘General Atmosphere Is Terrifying’

Gilt-Groupe

Last Wednesday, Betabeat broke the news of impending layoffs at Gilt Groupe. Later that morning, CEO Kevin Ryan downgraded the estimates we had heard, telling AllThingsD that the company intended to “selectively trim” about 50 people from its staff of 900 over the next couple months.

Tipsters have written into Betabeat that some of those layoffs are currently underway. “People leaving. Sadness. Super uncomfortable work environment,” said one source who wanted to remain anonymous, adding, “General atmosphere is terrifying.” Read More

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That $22 M. SEC Filing from Rue La La? That Wasn’t New Funding [UPDATED]

Rue La La elves Firing, Hiring and Funded.

News of layoffs at flash fashion startup Rue La La leaked last week: 60 people of the company’s 550-strong workforce had to be made redundant. But an SEC filing unearthed by TechCrunch today shows an odd contradiction: Rue La La just raised $22 million. UPDATE: The filing is not new money, Rue La La says, but rather a valuation filed as part of Rue La La’s equity plan, putting a dollar figure on equity and options that had already been issued. Read More

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Layoffs at Lot18: 15 Percent of Employees Were Just Let Go From Fast-Growing Luxury Discount Site

lot18

Lot18, the membership-based luxury item site that raised a whopping $45 million over the last year, just laid off 14 people, or 15 percent of the staff.

“A lot of this is a natural part of the way a business grows and evolves,” Lot18 founder Philip James told Betabeat. “Some positions aren’t needed. At the same time, we’re hiring heavily in areas that do make sense for us. This puts us back to October’s level, so just a couple months ago.”

The company was planning to slash a significant part of its workforce tomorrow morning, followed by a company-wide meeting. After Betabeat began inquiring, the company confirmed the layoffs and pushed them up to this afternoon. Read More

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Layoffs and Restructuring at Gilt Groupe as New Verticals Fail to Deliver Growth [UPDATED]

Gilt-Groupe

UPDATE: Gilt Groupe has not returned requests for clarification or comment, but responded via AllThingsD this morning.

CEO Kevin Ryan told the blog: “We are not closing down any businesses. We are not closing down Gilt Taste, and we aren’t merging Gilt City and Jetsetter.” Mr. Ryan also said, “In its fifth month of business, Park & Bond did more revenue than any other business in its fifth month,” although he did not say by what metric. He added that President John Auerbach is still employed at the company for now. But, he noted, there was a chance some of its top 15 executives may leave. (Chief Marketing Officer David Zucker left the company in July and Chief Product Officer Stefan Pepe left the company in June.)

Mr. Ryan did, however, tell AllThingsD that Gilt expects to “selectively trim” staff by about 50 over the next couple months, but claimed that by the end of March the number of employees would be larger than it is now. Gilt Groupe, he said, is on track for an IPO, possibly at the end of the fourth quarter, but mostly likely in 2013.

As for Gilt Taste, Mr. Ryan claimed that the site would need fewer staffers despite “doing great.”

Business Insider, where Mr. Ryan is chairman, has also confirmed impending layoffs of 50 to 60 people within the next week or so. According to Business Insider’s source, five to six percent of the company will let go across various departments in order to get cash-flow break-even by the second quarter of 2012.

Here is our original post:

Since Friday Betabeat has been hearing rumors about impending layoffs at Gilt Groupe. Late Tuesday night, a second source familiar with the company told us that the layoffs would happen on Wednesday and might be as high as 170 employees. We have reached out to Gilt Groupe for confirmation and will update the post as soon as we hear back.

The accounts vary, but both sources also point to restructuring within the company. One source said Gilt Taste, which hired former Gourmet editor-in-chief Ruth Reichl as editorial director last May, is expected to function at half its current workforce, with the remaining staffers funneled into other open positions in the company. Another source speculated that Gilt Taste was likely to be shut down.

Betabeat also heard that Gilt City and Jetsetter, which overlap in the high-end travel market, will merge. In October, Gilt City, which has a partnership deal with Google offers, acquired the daily deals site BuyWithMe, which itself suffered from big layoffs in the crowded deals space. Read More

Daily Daze

Source: Groupon Doesn’t Have The Cash to Build Its New Data Center

Apparently short a few G's.

In the run up to its recent IPO, a number of outlets reported that the daily deal giant Groupon was running short on cash. Over at the Motley Fool, Evan Niu noted that the company had $243.9 million in cash and equivalents at the end of September, compared with $465.6 million in accrued merchant payables, that is, the money they owed people who ran Groupon deals.

The company ended up raising $700 million, but according to a source familiar with its business, there still isn’t enough cash on hand to make critical structural improvements the company needs to grow. Groupon is shelling out millions every month on hosting costs, and paying a premium to third parties. The company is very eager to construct it own data center, but simply can’t afford it. Read More

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Black Friday Report: Ideeli Doubles Weekend Revenue Over 2010

Ideeli CEO Paul Hurley

Just a quick hit from the front lines of the e-commerce madness. One of New York’s big daily deal players, ideeli, just fired off an email on their Black Friday sales. The economy as a whole may be in the toilet, but that’s not showing up in their numbers.

  • ideeli doubled revenue over last year for the Black Friday weekend.
  • Visits to the site were up 30% over last year during the same period.
  • Conversion rate was up 50%. Not only did more customers visit, they bought more.
  • Over the Black Friday weekend, mobile traffic was double compared to same period last year. ideeli is now seeing over 20% in sales coming from mobile devices.
  • Cyber Monday sales were up 36% as of 2pm yesterday.

The dark economic climate may in fact be contributing to ideeli’s success. Read More

Daily Daze

After Big Layoffs, BuyWithMe Being Acquired By Gilt Groupe, Slashes More Staff

What a bargain!

Betabeat has learned that Gilt Groupe is in the final stages of acquiring the troubled daily deal site BuyWithMe, which laid off more than half its staff last week to sweeten the deal for potential buyers. The sale is a win for Matrix Partners, who has invested in both firms, and been backing BuyWithMe across three rounds and $30 million in venture funding.

BuyWithMe will officially be part of Gilt starting Nov. 1. The remaining sales staff who were left after last week’s layoffs will be let go with one weeks pay. Gilt gets a lean company consisting largely of technology, a few executives, a large email list of customers and merchants partners in cities around the country. Read More

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BuyWithMe Founder’s Axe List Included Employees He Didn’t Like

Maybe take out the comma.

Updates about the list from a former employee at the end of the post.

Second update from a source on who determined the firing list.

A source familiar with the situation revealed more details about the layoffs at BuyWithMe yesterday that left 55 percent of its staff unemployed without severance or warning. “The founder came back yesterday and literally made a list of people he liked and didn’t like and whacked everybody he didn’t like,” said the source.

“He’s not giving them anything,” added the source. “They were getting zero severance, zero warning. It’s perfect for a massive lawsuits kind of thing, which they’re probably going to get.”

The founder of BuyWithMe, the group buying deals site, is Andrew Moss. On his Twitter bio, Mr. Moss describes himself as, “Value-minded venture investor, Founder of BuyWithMe.com, former hedge fund COO/GC/CCO.” The company has also cycled through two CEOs, including an interim president when former CEO Cheryl Rosner stepped down last December. Read More

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Canned BuyWithMe Employee Says Company Died Because It Got Greedy

UPDATE: A source familiar with the situation says BuyWithMe founder Andrew Moss based layoffs on a list of employees he liked and didn’t like.

An employee of BuyWithMe who was laid off today, along with what he estimates to be about 55 percent of the staff, says the company went under because it got greedy.

“They were trying to raise a hundred million dollars at a $500 million valuation and there were no takers. If they had done a more conservative round, the company wouldn’t be in this kind of trouble.”

This employee says there is no hope of raising a round now and that the company is looking for a buyer. “They are hoping to just sell and get some of the value back.” Read More