Baltimore-based Bambeco, a fast-growing online retailer of sustainable home furnishings, has been sold to a Richmond, Va.,-based maker and distributor of home and garden goods after months of seeking an investor to support expansion.
Bambeco became a brand of Evergreen Enterprises after the sale, which closed at the end of October, the company said Friday. Financial terms were not disclosed.
“We believe that social consciousness can really be a kind of brand differentiator in the home decor space,” said Chris Wornom, director of business development and acquisitions for Evergreen.
Evergreen designs, makes and distributes products for 15 brands it owns and operates. About half are sold wholesale to stores while the other half are sold directly to consumers,
Bambeco “really fits on both sides of our portfolio,” Wornom said.
Susan Aplin, Bambeco’s founder and CEO, said the company’s board decided to sell the business in the spring because of a lack of capital funding to continue to operate and support growth.
The board, which includes Aplin and three other members, began working with an investment banking firm to find a buyer, she said. Aplin said Bambeco needed the investment at a time of rapid sales growth, with revenue mushrooming 350 percent in the wholesale division, which sells to 2,500 retail stores through chains such as Costco, Total Wine & More, Home Depot and Whole Foods.
The brand has been expanding internationally through Costco and adding locations with Home Depot and Total Wine.
“Bambeco was having the best sales performance year that the company has ever had,” Aplin said. “It’s been a high-growth brand for a number of years. … There was a feeling among certain members of the board that this was the right time for Bambeco to pursue an exit with a strategic partner.”
Sales totaled $5 million in fiscal year 2016 and $4 million in fiscal 2017 as of Aug. 31, with about 45 percent of annual revenue expected in the final quarter, according to Gerbsman Partners, a firm retained by Bambeco to seek buyers. The company had total sales of more than $20 million since its founding in 2009.
Bambeco, which is operating out of its former corporate headquarters and warehouse in Brooklyn, had 21 employees before the sale. About 14 have been rehired by Evergreen while others are in discussions with the new owner, said Aplin, who has stayed on as general manager and president of Bambeco.
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Wornom would not confirm how many Bambeco employees had been rehired, saying that the company is evaluating staffing needs and interviewing former employees.
“The goal with Evergreen is to find exactly what we need through the holidays and to firm up a 2018 plan,” Aplin said. “The overall market opportunity in sustainable home goods is still really dominated by Bambeco as a brand.”
Wornom declined to discuss Evergreen’s growth strategy for Bambeco, but said that Evergreen has “substantial scale and distribution that Bambeco is going to be in a position to leverage.”
Customers should have a seamless transition, he said.
Bambeco has raised about $31 million in equity and debt since its founding from venture capital firms such as ABS Capital, New Atlantic Ventures and NOVUS Capital, according to Gerbsman.