Shoes.com

» see shoes.com as it lived, on the wayback machine

~ the goodbye ~

On 27 January 2017 about two hundred people were told that the company was finished that day. The customers were told nothing at all. Three storefronts and two physical shops stopped taking orders, the phones stopped, and the staff were paid to the end of the month as a courtesy. Six weeks earlier the same business had been running Christmas.

Shoes.com was a Vancouver company by then, whatever the American domain name suggested. It began in 2012 as SHOEme.ca, built by Sean Clark in his parents' basement on the observation that Zappos had pulled out of Canada and left an entire country ordering footwear from nowhere in particular. He put a Shopify store up for sixty-eight dollars a month and bought shoes at retail to fill the first orders, because the point was to find out whether Canadians would buy shoes online at all.

They would. A million dollar run rate in year one, five million in year two, warehouses in Vancouver and Toronto, and about forty percent of the customers in rural Canada where a decent shoe shop is a long drive rather than a short one. That was the good version of this business and it had roughly twenty people in it.

None of this reached me and there is no reason it would have. Turkish online retail in those years was hepsiburada and gittigidiyor, a separate market with separate logistics, and a Canadian shoe site is about as far outside my orbit as a company can get while still selling something everybody needs.

~ the chronicle ~

~ the roll-up ~

On 15 July 2014 Hardy Capital Corporation bought SHOEme.ca and, on the same day, Seattle's OnlineShoes.com from Brown Shoe Company. Roger Hardy had founded Coastal Contacts, taken it public on Nasdaq and sold it to the French eyewear group Essilor for $430 million, so this was a man with money and a proven thesis about selling one boring category online very well. In December he bought the Shoes.com business, also from Brown Shoe, and put every property under that name.

The numbers got large quickly. Two hundred and fifty staff across North America, revenue somewhere around $200 million a year, roughly eight million customers, about $45 million raised and a $320 million valuation by May 2015. Hardy told a Vancouver business paper that year he was aiming at a billion by 2020.

What sat underneath the numbers was three companies with three warehouse systems and three sets of customers being told they were now one company. Shoes are a brutal category for it, because returns run high, sizes are personal and the free shipping that wins the order gets paid for twice when the box comes back. Through 2016 the group cut two thirds of its staff and outsourced work, which is what a business does when the revenue is real and the margin is not.

~ the last week of january ~

The shutdown on 27 January was immediate rather than wound down. On 3 February the Supreme Court of British Columbia appointed Alvarez and Marsal as receiver over Shoeme Technologies, and on 15 February over Shoes.com Technologies as well. The filings put debts at close to $59 million owed to more than two hundred creditors, with Deans Knight Capital Management the largest secured creditor at over $10 million and the party that pushed the company into receivership.

Then the estate went to auction in pieces, and the listing was blunt about what was actually left: around twenty thousand pairs of shoes and a set of domain names.

~ where the name went ~

The domains were the valuable part. On 31 March 2017 the court approved a sale of shoes.com and related intellectual property to Walmart for $9 million, and Walmart pointed it at Shoebuy, which it had bought a couple of months before. DSW took ShoeMe.ca. In 2022 shoes.com moved again, to Designer Brands, the company that owns DSW.

Sold three times in six years, and worth more each time than the operation that had been running behind it. That is the ordinary end for a category-defining domain: the letters survive because they are scarce, and the company that spent $45 million learning what those letters cost to actually operate does not. Type shoes.com today and someone will still sell you shoes. Nobody there was in Vancouver in January 2017.

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