Wine club Winc filed for Chapter 11 bankruptcy on Wednesday, just over a year after the online wine club went public.
In the voluntary filing, Winc is listed as holding just over $50 million in assets and $36,751,000 in debts, as of Sept. 2022. It hired Canaccord Genuity Group Inc. as its investment banker for bankruptcy proceedings, Bloomberg reports.
Chapter 11 bankruptcy allows a company to continue operation while the business and creditors create a plan to eliminate liabilities. As of Nov. 30, a stalking horse bidder (an initial bid that aids in establishing the price of a company) had been identified for the wine club, according to the Nov. 30 filing. Winc’s Q3 financial report, included in a Nov. 14 press release, painted a dismal picture of declining revenue for the service.
The direct-to-consumer online platform claims to be the “The Internet’s No. 1 Way to Wine.” Founded a decade ago, Winc reaches consumers with personalized recommendations through digital quizzes, flexible memberships, and home delivery.
Listed among the company’s top 30 creditors are several major technology companies. Winc owes Meta, Facebook’s parent company and the largest Winc creditor, close to $750,000. Influencer management platform Impact Tech is owed nearly $200,000, while Google Inc. holds over $79,000 in an unsecured claim.
The company first went public in Nov. 2021, posting a $22 million initial public offering, with stocks priced at $13 per common share. Prices for the company stocks, however, were initially filed to be in the $14–$16 range, according to Renaissance Capital. They were later adjusted to $12-$14.
The subscription service hasn’t yet officially announced next steps. However, the bankruptcy filing states that Winc “entered into a confidential, non-binding agreement with a potential stalking horse bidder for substantially all of the Company’s assets” on Nov. 30, signaling a potential upcoming purchase.
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