Bankruptcy: Amazon Aggregator, Thrasio's CEO, Execs Step Down

Thrasio, the once high-flying Amazon aggregator, is experiencing significant leadership changes as CEO Greg Greeley and five other senior executives resign. 

This news comes just months after the company filed for Chapter 11 bankruptcy.

According to an internal memo obtained by CNBC, Greeley informed staff of his decision to step down.

The company's CFO, technology chief, HR head, chief commercial officer, and supply chain leader are joining him in the exodus.

"The executives will stay on to ensure a smooth transition and then 'step down when Thrasio emerges from Chapter 11 in the coming weeks," the memo, written by Greeley, reportedly stated.

Thrasio's fall from grace marks a stark contrast to its earlier success story.

Once a leader in the booming market of acquiring and merging successful Amazon brands, the company secured significant investments from major firms like Goldman Sachs and BlackRock, reaching a peak valuation of $10 billion in 2021.

However, the tides shifted as the pandemic-fueled e-commerce boom waned.

Unsold inventory accumulated, and Thrasio, along with other aggregators, found itself burdened by excessive debt.

The company filed for bankruptcy in February, aiming to restructure some of its debt load with creditors.

"The predicted revenue trajectory from the brands in our portfolio does not support our current operating expenses and future interest payments," Greeley explained in the memo.

"We need to slim down further to ensure Thrasio can meet its financial obligations and serve customers effectively in the future."

Thrasio is also undergoing workforce reductions, with layoffs planned "at every level," according to the memo.

The exact number of employees affected remains undisclosed, though Thrasio employed approximately 1,211 people in 2022.

Adding to the company's challenges is the potential sale of some of its brands, particularly those considered smaller or more complex, according to an anonymous source familiar with the situation.

Thrasio's ability to emerge from bankruptcy is further complicated by an ongoing investigation launched by the Unsecured Creditors Committee.

This committee seeks to understand "how the debtors lost over $3 billion in value in less than two years," as stated in a separate court filing from last week.

The creditors have raised concerns regarding multiple issues, including a 2020 insider tender offer, potential conflicts of interest with loan repayments, and over $300 million in company stock sales by officers and directors, which have led to "allegations of fraud."

This leadership shakeup follows a previous overhaul in 2021, with co-founder Josh Silberstein resigning and the company laying off roughly 20% of its staff.

Greeley, a veteran from Amazon with nearly two decades of experience, was appointed CEO in 2022. He, along with other executives recruited from Walmart and Amazon, aimed to steer Thrasio towards recovery.

However, their efforts appear to have fallen short in the face of the company's complex financial situation.