Tells creditors to opt into shares of parent company, FemTec Health.
FemTec Health sent a letter to creditors earlier this month advising them of bankruptcy proceedings and suggested they consider opting into shares of FemTec.
“We believe, in the best interests of Birchbox and the entire FMTC family of companies spanning the U.S. and Europe, a Chapter 11 or some equivalent structure may be necessary,” the letter read.
The letter gives creditors the option to receive shares in FemTec Health in the full amount of their obligations. “We cannot negotiate separate deals with more than 150 creditors,” the letter continued. “If we can come to an agreement regarding this new Class A Preferred Stock, FMTC will commit to continue to building Birchbox.”
Struggles Post Acquisition
After Birchbox was acquired in 2021, FemTec announced that it would shift the brand’s focus from “beauty product discovery” to curated, personalized skin and healthcare products utilizing FemTec Health’s BiomeAI platform.
At the time, Katia Beauchamp, founder of Birchbox, said, “FemTec’s vision for the future of women’s healthcare was inspirational to me and I could see the opportunity for the thousands of women in the Birchbox community to extend beyond consumer beauty products to a more holistic health and wellness offering.”
Evidently, things did not go as planned. According to FemTec Health’s letter to investors, Birchbox’s revenue projections dropped from $74 million to $47 million, even following a $30 million infusion from FemTec.