Since the glory days of Karmaloop ended long ago, the infamous online streetwear store has officially been sold. Things began going all downhill even before the e-retailer filed for Chapter 11 back in March. Apparently, Damon Dash and Kanye West had plans to purchase the failing clothes company in an attempt to do some business together. However, when they both failed to make a bid, someone else came and swooped Karmaloop away from them. Find out who the new owners of Karmaloop are after the jump!
It seems like Dame Dash and Kanye West scrapped the idea of purchasing Karmaloop. On Thursday (May 21), a federal bankruptcy court judge approved the $13 million-dollar sale of Karmaloop to a private investment firm based in West Palm Beach, FL called Comvest Partners and Chicago-based finance company CapX Partners.
Previously, it was reported that Damon Dash and Kanye West wanted to purchase Karmaloop, but neither of them made a bid before the deadline of the auction. Comvest and CapX Partners were the only ones to make a bid on Karmaloop during the auction, which officially ended last Wednesday. Former Karmaloop CEO Greg Selkoe will be replaced and will given an advisory role in the new company. A new CEO will be announced within the next few weeks.
“I certainly take responsibility more than anyone that these businesses didn’t ultimately bear fruit,” said Selkoe. “I certainly feel it’s been a tough experience and I’m the type of person that doesn’t like letting customers down. You’ve got to be resilient and you’ve got to just keep going.”
According to Internet Retailer, a series of bad e-commerce investments, like video production arm Karmaloop Media and women’s fashion e-commerce site MissKL.com, were to blame for the company’s decline. Over the years, Karmaloop built up more than $100 million in debt before Selkoe filed for bankruptcy in March. The company collectively owed $19 million to vendors, who said Karmaloop missed payments frequently. The e-store’s annual sales, which had once peaked at $127 million, dropped significantly to $80 million by last year.
