Karmaloop May File for Bankruptcy

Once considered an e-retail streetwear mecca, Karmaloop may soon be no more. According to the New York Post, the Boston-based site is “scrambling” to avoid a Chapter 11 filing. Chief executive Greg Selkoe is reportedly in talks with several investors, including a New York-based private-equity firm, to pay off a large chunk of the company’s debt while injecting $10 million USD into the business. One of those investors is Big Apple-based venture capitalist fund Insight Venture Partners, which has already invested more than $50 million USD in the company.

Sources say that debt obligations have crippled Karmaloop as it took in less than $100 million USD in revenue last year while others have pointed out that a large part of the debt is related to “flopped side ventures by Selkoe” like women’s label MissKL.