Physical gift-giving site Wantful—a joint venture with Nordstrom (NYSE:JWN)—was forced to suspend operations on Monday (Sept. 9) after running out of money.
Nordstrom and Wantful formed the joint gift venture earlier this year, but Wantful recently lost a planned follow-up investment. Nordstrom put up $100,000 in last-minute cash to help ease the blow to the 16 Wantful employees who would be losing their jobs.
"What we did not accomplish yet—both by circumstance and execution—is the kind of highly accelerated growth required to secure later-stage venture capital, despite the enduing enthusiasm around what we've built," Wantful founder and CEO John Poisson wrote in a blog post. Wantful had raised $5.5 million.
Wantful isn't the only gift-giving site to lose steam lately, however. In August, after less than a year on the market, Facebook also shifted the focus of its gift service off physical gifts and onto digital gifts. More than 80 percent of gifts sent on Facebook were digital. "The physical stuff is interesting for sure, but our goal is to build stuff that's really great for the majority of people who are using it," Lee Linden, head of Facebook's Gifts program, told All Things D at the time.
While Wantful wasn't able to continue operating, Poisson believes the company established an effective model for physical gift giving. Wantful sported a network of 600 vendors, with what Poisson called "streamlined logistics architecture to support [their products]." The company boasted experiences for web, tablet, print and in-store, he added.
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