Online furniture retailer Brosa has fallen into voluntary administration, after its rapid pandemic-fuelled growth slowed when COVID-19 restrictions lifted across the country.
Brosa was founded in 2014 by David Wei and Ivan Lim, who created a vertically-integrated business that combined furniture retailing with technology via an online platform. The Brosa platform allowed consumers to purchase designer products without many of the extra costs associated with traditional wholesale and retail furniture operations.
In its early years, the business secured significant funding from prominent investors, including $2 million in AirTree Ventures in 2015 and a $5 million Series B funding round led by Bailador Technology Investments, AirTree Ventures and BMY Group in 2017.
By early 2021, Brosa had expanded to include showrooms in Melbourne and Sydney, as well as its e-commerce store, and more than 75 employees.
However, the business was placed in voluntary administration on Wednesday, with Richard Tucker and Michael Korda of KordaMentha appointed as administrators to oversee a sale process.
According to Tucker, Brosa encountered challenges when sales began to slow once COVID-19 restrictions were eased and fewer people were shopping online.
“This caused short-term cashflow pressures after a period of phenomenal growth,” he said in a statement provided to SmartCompany.
The administrators are now seeking “urgent” expressions of interest in the sale of Brosa as a going concern.
“The business tripled in size during the pandemic, developing a strong customer base and technological capabilities that would be an asset to many other furniture retailers,” Tucker added.
The company has developed protocols around sales and deliveries which “could be a good opportunity for any furniture retailer who wants to develop that side of their business”, a spokesperson told SmartCompany.
Brosa had already begun “a campaign to reduce its inventory holdings and refocus itself as a make-to-order business”, added Tucker, and the administrators plan to continue clearing stock over the busy Christmas period.
The Brosa website remains online at time of writing, with the company highlighting its Christmas promotions as late as Tuesday afternoon.
Shoppers looking to capitalise on Brosa’s furniture stockpile have been advised to visit its website.
“The administrators are making extra efforts to sell that stock to customers and that stock will be delivered to customers when they order and pay for it,” the spokesperson told SmartCompany.
Brosa’s employees “will keep their jobs for the foreseeable future”, subject to the long-term outcome of the sale process.
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Eloise is an experienced business journalist and editor, who has held senior editorial roles at SmartCompany since 2014. Prior to joining SmartCompany, Eloise was news editor at Books+Publishing, the trade press for the Australian book industry. Eloise has degrees in media and communications, marketing and business management, and political science. You can follow her on LinkedIn, and Twitter at @ellykeating.
