Customised footwear e-tailer Shoes Of Prey has ceased trading, after nine years in which the once market darling raised $30.6 million but ultimately failed.
Major investor Blue Sky Alternative Investments said the decision to stop taking new orders was made to protect Shoes Of Prey’s assets and avoid incurring more debt, as it continued with a dual-track process to either raise more capital or sell the business.
“The company will continue negotiations with interested parties and endeavour to seek a path through that allows it to resume trading and deliver a return to its shareholders,” Blue Sky’s head of venture capital Elaine Stead said in a note to investors.
After writing down the value of its Shoes Of Prey stake by 87 per cent earlier this month, the e-tailer’s shutdown was not material enough for Blue Sky to make an announcement to the ASX on Tuesday.
Shoes Of prey co-founder Jodie Fox addressed the shutdown in an Instagram post on Tuesday.
“Just like every company, behind the scenes we faced struggles,” she wrote.
“While all indicators and data were positive, we were not able to truly crack mass-market adoption.”
Ms Fox added that Shoes Of Prey would be retrenching most of its staff, and was “actively helping them transition into new positions with other companies.”
In a Department Of Industry profile on Shoes Of Prey last updated in June, the company claimed a headcount of 150 staff across five offices worldwide.
Founded in Sydney in 2009 by Ms Fox, her then-husband Michael Fox, and Mike Knapp, the start-up attracted a who’s-who group of investors including Atlassian’s billionaire co-founder Mike Cannon-Brookes, prominent Silicon Valley venture capitalist Bill Tai, and VC firms including Blackbird Ventures, Khosla Ventures and Greycroft Partners.
Ms Fox always proclaimed Shoes of Prey as a ‘born global’ start-up, and it relocated its headquarters to Los Angeles in 2015.
The Nordstrom department store chain also invested, however it was Shoes of Prey’s ‘pop-up’ physical presence in their stores, as well as in David Jones, that was blamed for a high cash burn at the company which saw it revert to a pure e-tailer in 2016.
Shoes Of Prey investors will likely book large losses, however Blackbird Ventures partner Niki Scevak said he was proud of his firm’s long involvement with the company.
“Unfortunately, the sad odds of startups mean failure is just as likely as a success, but we will never shy away from giving ambitious founders like Jodie, Michael and Mike a swing at greatness every single time.”