Thursday, January 12, 2012

Sources: Rue La La parent Retail Convergence lays off 65, closes SmartBargains

By Galen Moore, Boston Business Journal

The Boston-based company that operates private sale site Rue La La has undertaken major layoffs, according to current and former employees.

Employees told Mass High Tech and the Boston Business Journal that Rue La La operator Retail Convergence Inc. held layoffs Thursday - and the company confirmned the number at 65. The company’s Boston staff was at about 200. The company plans to shutter its SmartBargains.com, a discount shopping site it runs in addition to Rue La La, and merging it into Rue La La, sources said.

“It was a mess upstairs. People were crying all over the place,” said one employee laid off Thursday, who asked not to be named.

Founded in 2008, Rue La La operator Retail Convergence raised venture capital, before selling for $350 million to Pennsylvania-based GSI Commerce Inc. in 2009. When GSI was acquired by eBay Inc. (Nasdaq: EBAY), last March,  Rue La La was reported to have received $500 million in debt and equity financing as part of the deal, which spun off Retail Convergence as an eBay subsidiary.

Retail Convergence also launched and operated the discount shopping site SmartBargains.com. At the time of the GSI acquisition, Rue La La had almost 200 employees, a number that was confirmed Thursday by Boston Business Journal’s source there.