Today, news has broken that Nasty Gal is expected to file for bankruptcy. According to , the retailer “is preparing to file for Chapter 11 bankruptcy protection, allowing it to reorganise its business” and its founder Sophia Amoruso is resigning as executive chairwoman.
“Our decision to initiate a court-supervised restructuring will enable us to address our immediate liquidity issues, restructure our balance sheet and correct structural issues including reducing our high occupancy costs and restoring compliance with our debt covenants,” said Nasty Gal CEO Sheree Waterson in a press release.
“We expect to maintain our high level of customer service and emerge stronger and even better able to deliver the product and experience that our customers expect and that we take pride in bringing to market,” she continued.
One of America’s richest self-made women, Sophia Amoruso started Nasty Gal when she was 22. What began as a vintage shop on eBay grew into an online retail giant – a success which has been fuelled by her book #Girlboss which gave her an audience and following among young female customers.
However the last two years really haven’t been smooth sailing for Nasty Gal which has laid off a lot of staff, experienced a change in CEO (after Amoruso stepped down and became executive chairwoman) and been sued by several former employees. The brand has also been accused of copyright infringement after allegedly copying the designs of brands including Alexander Wang, Céline, Givenchy and emerging jewellery designer Wendy Brandes.
This doesn’t mean the end of Nasty Gal, though – the company, which reportedly was looking for a buyer last year, could be bought or invested in. Time will tell.