Fab Sells to PCH for a Tiny Fraction of Its Former $1 Billion Valuation
Fab's abrupt transformation from investor darling to cautionary tale has finally reached its conclusion.
Today, it was announced that what remains of Fab has been sold to PCH International, an Irish electronics contract manufacturer for an undisclosed price, although Recode places the figure at $7 million in cash and $8 million in stock. Fab’s last 35 employees will also be acquired by PCH, although they will remain in New York, Bloomberg reports. PCH – which already works with startups to produce hardware – will use Fab.com as a sales channel.
Fab's acquisition marks the end of what has been a rollercoaster trajectory for the company. There were the multiple twists (the site started in 2011 as a dating site for gay men, transitioned into a flash-sale site, then pivoted to traditional ecommerce), the meteoric rise (in the summer of 2013, the company raised $150 million at a valuation of nearly $1 billion) before exploding costs led to a series of increasingly dramatic plummets (rounds and rounds of layoffs).
Related: This Could Be Fab's Last Breath
Fab's CEO and co-founder Jason Goldberg -- who initially wowed investors with bold claims that Fab could be the next Amazon and continued to mount a fiery defense of his startup even as its foundation crumbled -- will no longer be involved with the company.
Instead, he will turn his full attention to Hem, the Berlin-based furniture company he founded last year. "All of the funds raised from that transaction will be reinvested into Hem," Goldberg wrote in a release announcing the news. "The stockholders that originally invested in Fab will continue to hold the same ownership interest in Hem."
Despite Fab's demise, Goldberg apparently isn't done yet.
"Hem is well financed and on solid ground," he said. "We are following a specific plan to create a valuable company that exceeds our customers’ expectations and that all of our employees and shareholders will all be tremendously proud of for the long term. These are still early days."