Flash sales startup Gilt Groupe might sell itself for a fraction of its old valuation

Michelle Peluso, Gilt
Gilt Groupe CEO Michelle Peluso Rommel Demano / Stringer / Getty Images

Hudson’s Bay Company — the owner of Saks Fifth Avenue — is nearing a deal to buy luxury flash-sales site Gilt Groupe for $250 million, reports The Wall Street Journal.

Gilt has raised a total of $300 million since launching in 2007, including a massive $138 million funding round in 2011 that reportedly valued it near $1 billion.

Most recently, it raised $50 million in February, likely in a down-rounder at a lesser valuation.

For a long time, Gilt seemed on the brink of an IPO, but it struggled to reach profitability and started scaling back, closing, or selling parts of its business and laying off employees.

Earlier this year, flash-sales site Zulily sold to QVC for $2.4 billion, lower than its value after its IPO, and other flash sales sites have largely failed to maintain growth.

If the Gilt deal goes through, it will be sucked into HBC’s Saks Off 5th brands, the WSJ reports.

Overall, it’s been a tough year for tech startups, with investors slashing valuations, VCs yelling ‘bubble,’ and quite a few complete shut-downs.

Business Insider reached out to Gilt Groupe for confirmation or comment and will update if we hear back.

Disclosure: Kevin Ryan and Dwight Merriman, the founders of Gilt Groupe, are investors in Business Insider.

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