Zulily went from $2.6B IPO to going-out-of-business sale in 10 years

Zulily was founded in 2009 by former Blue Nile executives Darrell Cavens and Mark Vadon, targeting young mothers with a flash-sale ecommerce model: brand-name children's apparel, apparel, and home goods sold in 72-hour events, with the company holding no inventory. It grew rapidly — by 2012 it had 10 million members, and its 2013 IPO valued the company at $2.6 billion. Revenue reached $366 million by 2016.

The model had a hidden flaw. Zulily sold products before ordering them from vendors, which meant customers waited weeks for delivery and had no recourse when items were defective or wrong. Customer retention suffered. Revenue growth slowed from 52% to 29% in 2015, and QVC's parent Qurate Retail Group acquired Zulily for $2.4 billion in 2015. Under Qurate, revenue declined steadily — by 2023 it was down 17% year-over-year to $192 million in Q1, with a $43 million operating loss.

In May 2023, private equity firm Regent bought Zulily from Qurate. The new owners did not pay vendors, and lawsuits over unpaid invoices mounted. The CEO left in October 2023. In December, Zulily announced a going-out-of-business sale, laid off 800+ employees, and appointed an assignee to liquidate assets. The brand was sold for $4.5 million in 2024 — a 99.8% drop from its peak valuation.