FemTech sells Birchbox only two years after acquisition

The investment firm FemTech has sold subscription box company Birchbox, which it acquired in 2021 for $45 million, to Retention Brands for an undisclosed sum.

The beauty subscription service’s assets were purchased by Retention brands in an open-bid process through an assignment for the benefit of creditors. However, details of the sale are yet to be disclosed.

Founded in the US in 2010 by Harvard graduates Katia Beauchamp and Hayley Barna, Birchbox was a pioneer in beauty sampling and spawned a host of copycat businesses and services. At the height of its success, Birchbox was said to be worth around $500 million and had 2.5 million active users across the globe and partnerships with 800 brands.

FemTec Health said in a statement that the sale of Birchbox came as part of its "strategic tightening around core healthcare businesses". It noted that Birchbox came among the company’s "underperforming assets".

Retention Brands is a company that acquires and invests in subscription commerce, eCommerce marketplaces, & consumer brands. The sale comes after complaints about Birchbox’s service. Customers claimed that their orders hadn't been fulfilled.

In November 2022, Birchbox halted orders on its UK website amid reports it was investigating the possibility of entering Chapter 11 bankruptcy protection in the US.

A notice on the retailer's UK website read "Birchbox is facing a host of unprecedented setbacks that are affecting all our members. We currently are no longer fulfilling orders or shipping subscription boxes. We will update our members in due course when we have more information available."