Once an icon in subscription-based retail, beauty company Birchbox is now radio silent, leaving some vendors without pay and customers without products.
The company’s website is no longer working and generates a “deployment disabled” error message. Based on screenshots Retail Dive took on Jan. 25, the company’s website was still active at the time and users were able to view products. However, customers weren’t able to check out and would receive a message about technical difficulties.
The website is now entirely disabled, and screenshots from the internet archive Wayback Machine show that this began sometime in February.
Birchbox – which became famous for selling curated subscription boxes with beauty samples – was acquired by women’s health company FemTec Health in October 2021 for around $45 million. Neither company has responded to requests for comment.
Birchbox and its parent company are also struggling to pay some vendors. An investigation by Axios in October found that FemTec Health hadn’t paid several vendors, including Facebook parent Meta. In an interview, founder and CEO Kimon Angelides told Axios that the company intended to pay vendors as soon as possible, hopefully by the end of October.
As of January, though, some vendors and a content creator still haven’t been paid, according to emails a former employee shared with Retail Dive.
A social media content creator signed an agreement with Birchbox in May of 2022 and hadn’t been paid the $2,500 due as of Jan. 24, despite several emails to the company. In an email obtained by Retail Dive from Oct. 4 about the outstanding payment, FemTec Chief Marketing Officer Gayle Bock said “the company is out raising another round of funding and until that is closed there is no update.” The content creator did not repsond to requests for comment at the time of publication.
In another document obtained by Retail Dive, a law office representing Bazaarvoice sent a letter to FemTec Health on Jan. 10 asking for a payment of $68,927 for services rendered, with one invoice said to be over six months old. A legal representative was not able to provide an update or comment from Bazaarvoice at the time of publication.
Allegations against FemTec Health regarding outstanding payments have also been brought to court.
On Oct. 26, cosmetics manufacturer and distributor Aromatherapy Associates filed a complaint against Birchbox and FemTec Health in the Southern District of New York. The complaint alleges that Birchbox was in breach of a distribution agreement and owed the company $226,695.08 for product purchases dating back to 2021. That amount had not been paid despite multiple requests for payment.
Aromatherapy Associates was granted a certificate of default from the court on Dec. 8 after the defendants hadn’t filed a response to the complaint. Aromatherapy Associates did not respond to requests for comment at the time of publication.
A breach of contract complaint was filed on Nov. 16 against FemTec Health by Wellspring Advisers, a law group based in Alameda, California. The complaint alleges that FemTec has “refused and continues to refuse to compensate” the law group for services rendered, with the amount in question exceeding $75,000.
As of Feb. 8, the court clerk filed a notice to reschedule a case management conference for the Wellspring Adviser case “in light of the fact that the defendants have not appeared.” Wellspring Advisers did not repsond to requests for comment at the time of publication.
A troubled history
Prior to its acquisition by FemTec, Birchbox was already showing signs of strain. The beauty company had laid off 25% of its global staff in February 2020, with Birchbox aiming to reduce redundancies and move some U.K. operations to Spain.
Getting acquired by FemTec offered Birchbox a chance to grow with fresh funding.
“I think that after the pandemic year, which was just a lot of changes and uncertainty, we definitely were excited by the fact that FemTec wasn’t just a big vision, but it was going to be a really well-financed vision,” Birchbox founder Katia Beauchamp told Retail Dive at the time.
Despite being bought by a health company, Beauchamp said Birchbox was “not trying to leave beauty at all.” As a result of the acquisition, Beauchamp became a strategic adviser but is no longer listed as such. It is unclear when she left that role. As of August 2022, Beauchamp had become the CEO of Victoria Beckham Beauty, according to her LinkedIn profile.
Since the acquisition, though, Birchbox’s problems have grown. In the company’s most recent Instagram post dated Nov. 7, the company told its more than 520,000 followers that it was facing unprecedented setbacks and was searching for a viable solution. Around the same time, FemTec Health was reportedly considering bankruptcy, according to a report from Women’s Wear Daily. In a letter to creditors cited by the publication, FemTec offered creditors the option to receive FemTec shares instead of payment.
Screenshot: Birchbox/Instagram
Comments from the past several months on its Instagram post as of March 2 indicated customers were still waiting to receive boxes already paid for and hadn’t been able to use points accrued toward purchases.
A majority of the nearly 300 Better Business Bureau complaints about the company have been filed over the past 12 months.
“I have a credit of $153 with this company for subscription boxes traded for credit. I have been trying to purchase products from them and continually get a message they are experiencing difficulties to try again later,” one customer wrote in a complaint on Jan. 30.
The same customer updated their complaint last week to say the website appeared to be disabled.
The founding of FemTec
Parent company FemTec Health launched in October 2021 with over $38 million raised, according to a company press release. Investors included Longmont Capital, Ithaca LifeSciences, Unilever Ventures, Shiseido and more.
The health group has acquired several other companies in addition to Birchbox, including Mira Beauty, Ava Women and Liquid Grids. FemTec Health also launched a DTC box service for health products in February 2022 called Awesome Woman, which still has an operational website but hasn’t posted on Instagram since September.
FemTec Health founder, executive chairman and CEO Kimon Angelides has also founded several other companies.
Angelides founded Livongo, which was acquired by Teladoc in 2020 for $18.5 billion. Teladoc recorded a $6.6 billion impairment charge for Q1 in April of last year resulting from the tricky merger.
Angelides — who holds a Ph.D. according to the FemTec website — also founded Vivante Health and Diabetes America.
While some customers and vendors have waited since last year to hear from Birchbox, FemTec has a company website based in Greece with a copyright date of 2023.
