Subscription service Birchbox raises $15 million
August 3, 2016 02:39 PM
Online beauty subscription retailer Birchbox Inc. has raised $15 million in financing “to bridge the company to profitability,” a company spokeswoman says.
Investors were not identified, and the spokeswoman for the online-only cosmetics and personal care products retailer declined to specify which of its existing investors were involved in the round. Birchbox is No. 202 in the Internet Retailer 2016 Top 500 Guide.
“Birchbox’s investors are very supportive of its ambitious long-term vision, and continue showing their confidence in the business through this round of financing,” she says.
Birchbox would not comment on when it expects to achieve profitability, but a source close to the situation says the e-retailer is likely to turn a profit by the start of 2017. According to CrunchBase, the latest round of funding brings the total raised by Birchbox to $86.9 million over four rounds.
The move comes amid a tumultuous year for Birchbox. In January, the retailer eliminated 15% of its staff—or 50 of its employees—and suspended its operations in Canada. It said then that those moves were aimed at helping the company turn a profit by the end of this year. Those cuts weren’t enough, however. In late June, Birchbox made further cuts, laying off another 30 employees, or 12% of its remaining staff.
“The cuts [in January] were not deep enough to get us where we need to go in the time frame we want," Birchbox co-founder and CEO Katia Beauchamp said at the time of the June layoffs. "I wish I had been less conservative."
According to Top500Guide.com, Birchbox did an Internet Retailer-estimated $144 million in sales last year, up 50% from $96 million in 2014.