One of the most talked-about rising companies in retail is reportedly filing for bankruptcy
Hot clothing company Nasty Gal is reportedly filing for bankruptcy, Re/code reports.
Founder Sophia Amoruso, who founded the company as an eBay shop in 2006 when she was 22, will also step down as executive chairwoman.
The once-promising hip retailer for young women has been through some tumultuous times in recent years.
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Amoruso stepped down as CEO in 2015, saying the growing fashion company needed a leader with more experience in day-to-day operations. She was replaced by Lululemon alum Sheree Waterson.
Since then, the company has had layoffs. Former workers complained of a toxic environment.
The company was once extremely successful, with Bloomberg giving it an estimated worth of $100 million.
The company received an additional $16 million in funding last year from former JC Penney CEO Ron Johnson and Index Ventures.
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Mounting competition might have led to the company's decline.
"Since their beginnings, companies like Nasty Gal and Birchbox [which laid off employees last week] have led with innovation. And so yes, perhaps they grew too quickly with innovation. And now there are other market disruptors in each of these categories that they now have to compete with," Valerie Davis, industry expert and senior vice president of paid media at digital marketing agency PM Digital, wrote in an email to Business Insider in February.
Re/code says competition from similar sites like Tobi could be hurting the business.
In her memoir #GIRLBOSS, Amoruso said she never planned on running a huge company.
"I was 22 and, like most 22-year-olds, I was looking for a way to pay my rent and buy my Starbucks chai. Had someone shown me the future of where Nasty Gal would be in 2014, I would have gasped in revulsion, thinking, Oh, hell no, that is way toomuch work," she wrote.
Mallory Schlossberg contributed to this story.
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