Well this is sad news. San-Francisco-based online retailer Modcloth is leaving its days as an independent business behind it, having been purchased by Jet.com, an online retailer owned by Wal-Mart. In a news story broke by Jezebel, the announcement of the sale was announced to employees at a meeting this morning (March 15, 2017).
“It was explicitly stated that starting Friday paychecks come from Wal-Mart,” a current employee told Jezebel, which noted that the company’s current employees received offer letters from Walmart Wednesday morning.
San Francisco-based Modcloth has long been known for catering to the non-basic female customer, serving up punk, Goth and rockabilly flavored garments. Models are Photoshop free and featured in all colors, shapes and sizes, reflecting a core company belief in advocating for women.
The company was founded by Eric and Susan Koger in their Carnegie Mellon University dorm room in 2002, but hit a bump in the road in 2014, a set back that include layoffs. The issues lead the founders to bring in Greg Kaness, a “real” CEO whose resume included Urban Outfitters.
Given the backdrop of Modcloth, a sale to Jet.com seems like the ultimate nightmare sale, especially given Wal-Mart’s history of poor treatment of workers, including a class action on behalf of 1.5 million female Wal-Mart employees who said they faced discrimination in pay and promotion.
And indeed, when the news of the sale was announced, according to Jezebel, it prompted “an immediate, audible rustle of dismay from people.” One the other hand, at least they still have jobs. For now.