Minneapolis- and San Francisco-based e-commerce startup Brandless on Monday announced that it will be halting operations.
Founded under an everything-for-$3 model, Brandless sold a range of everyday essentials ranging from food to personal care items. The company’s leadership said it kept costs down by selling products without brand names.
Brandless will now lay off 70 people, or about 90 percent of its staff, according to tech news site Protocol. The remaining staff will take care of standing orders and assess any acquisition offers. Brandless is the first SoftBank Vision Fund-backed startup to close down, Protocol reported.
“While the Brandless team set a new bar for the types of products consumers deserve and at prices they expect, the fiercely competitive direct-to-consumer market has proven unsustainable for our current business model,” the company said in a statement posted on its website.
Co-founder Tina Sharkey, who left the company last year, previously told Twin Cities Business that her goal was to eliminate “brand tax,” or hidden costs that come with national brands.
An Axios article revealed a host of issues leading up to the company’s closure. For instance, though the company said it had raised nearly $300 million, the total amount never materialized. Brandless failed to secure its third tranche of funding worth around $120 million after missing milestones required by SoftBank.
Brandless didn’t immediately respond to TCB’s request for comment.