We covered the Karmaloop downturn quite a bit right when it all started to aggressively unravel a couple of months ago, but our brethren at Complex Style dove in head first to document all the ins and outs that went into the rise and fall of one of the first, most innovative and enormous streetwear outlets' collapse, talking to insiders and even the company's founder and CEO himself, Greg Selkoe.
As to be expected, things turned from small to big and, subsequently, from businesslike to ratchet real fucking quick, but it worked as long as Karmaloop was bringing in tons of money. Despite their final undoing this year, things were a long time coming, as debts piled up to over $100 million. There were big ambitions like a 24-hour TV network, Boston-based store and brand offshoots that became money sinks as online retail really took off. Unfortunately, those side projects only compounded the problem rather than adding any extra revenue.
Products on the site were discounted to incredible degrees, which meant good deals, but less profit for Karmaloop and ultimately a connotation that it was selling mediocre goods, the direct antithesis of Selkoe's early goals. Its strategy of providing discount codes for influencers to push product didn't work and, in the end, it looks like Selkoe just couldn't contain all the bad investments and internal issues.
The piece is long and detailed and if you've ever bought something from Karmaloop, getting completely fucked over in the process, it's a tasty piece of schadenfreude.