Gift-Giving Service Wantful Shuts Down Suddenly
The gift site Wantful is suspending operations, it said today.
Founder and CEO John Poisson wrote in a blog post that the company was forced to shut down after losing a planned follow-on investment.
He said in an interview that the investment was part of a strategic relationship with Nordstrom, with which Wantful had launched a joint gift venture earlier this year.
“In their calculus it didn’t make sense for them, and that was right. But when they pulled back, it put us in a position where we didn’t have time to react,” Poisson said. The deal fell apart only last week.
Still, Nordstrom was not the only investor involved in the 2.5-year-old company.
Wantful had raised $5.5 million in Series A funding led by Polaris Venture Partners, along with Harrison Metal, Greylock Partners, Forerunner Ventures, Alison Pincus, Dave Morin, Dennis Crowley and Matt Mullenweg.
“In e-commerce, venture capital is looking for really steep growth curves,” Poisson said, explaining why a further round of funding wasn’t forthcoming.
Nordstorm, of course, wasn’t so keen on the retelling of the story that made its yanking of funding the final straw that broke the camel’s back.
“The bottom line is we’re not responsible for what’s going on here,” said Nordstrom spokesperson Colin Johnson. “We lived up to our obligation, and unfortunately the company didn’t meet the conditions we laid out to invest.”
Further, Johnson attested that Nordstrom put up $100,000 in last-minute cash as the company was going under, in order to help take care of the 16 members of the Wantful team who were losing their jobs.
In retrospect, Poisson said he was proud that Wantful had successfully set up a “drop-ship” system, where some 650 retailers received orders and sent them directly to customers. Wantful also had worked to tell stories behind brands, and launched its own print magazine.
Poisson argued that Wantful’s closure was not an indictment of online gifting, especially after Facebook recently shut down a similar service for physical goods in favor of gift cards. “Gifts are a primal human form of communication,” he said.
However, Poisson could not think of another gifting startup that was doing well.