10th November 2022
Bite-sized business news from the UK and beyond
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Today's stories
Next snaps up Made.com brand
Crypto world rocked by mega-merger talks
RETAILNext snaps up Made.com brand
What happened?Yesterday high street giant Next bought the Made.com brand for £3.4m after the collapse of the online furniture retailer earlier this week. It marks a disastrous 18 months since the firm listed on the stock market with a valuation of £775m.How did we get here?Founded 12 years ago in London, Made become known for its sleek furnishings appealing to Millennials and was a big beneficiary of the boom in ecommerce during the pandemic. But this year the company has reported growing losses as it faced demand and supply side challenges:
The weaker economic outlook and cost of living squeeze means consumers are cutting back on big ticket items like furniture.
Covid-related bottlenecks in the global supply chain meant long delays for products and more expensive shipping.
On Wednesday Made fell into administration after running out of cash. While Next has bought its brand, website and intellectual property it will not keep on 400 of Made’s 600 employees.What next: Made stopped taking new orders last month but there are around 12,000 UK customers who have paid for goods that won’t be delivered. These customers will have to wait to see if they will be refunded.
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Twitter lays off staff at its only Africa office
ITV expects advertising bump from winter World Cup
Wetherspoon’s to sell 39 more pubs as costs rise ‘substantially higher’
Adidas to sell Yeezy designs under new name after Kanye West split
CRYPTOCrypto world rocked by mega-merger talks
What happened?This week the crypto market was left stunned after Binance, the largest crypto exchange, proposed to buy FTX, its largest competitor - before eventually backing out. The news sent shockwaves through the crypto world with major currencies Bitcoin and Ethereum falling sharply.How did we get here?Binance CEO Changpeng “CZ” Zhao and FTX chief Sam Bankman-Fried have been feuding on social media for months. That bitter rivalry escalated over the weekend when CZ actively undermined the confidence in FTX’s finances and said it would sell the assets it had on FTX.This spooked other FTX users and they withdrew $6bn in three days fearing the platform would collapse, threatening liquidity and the overall company. CZ then stepped in with an offer to buy FTX and stop “a significant liquidity crunch.” The shocking development would have cemented Binance as the #1 player in crypto.However after conducted due diligence Binance announced it would not go through with the deal as there are reports FTX has "mishandled customer funds". Binance said that the issues facing FTX were "beyond our control or ability to help".The situation marks a reversal of fortunes for FTX. The platform began the year bailing out struggling crypto firms and was most recently valued at $25bn in October – making its 30-year-old CEO one of the world’s youngest self-made billionaires. That valuation and fortune has almost certainly been decimated.
What happens next:FTX's future looks increasingly uncertain Bankman-Fried told investors the firm nees at least $4bn to stay afloat. Crypto has seen similar collapses before - Three Arrows Capital and Celsius went bankrupt a few months ago - but FTX is much larger in scale. Crypto investors aren’t too thrilled that one of the most powerful crypto firms is on the brink of bankruptcy.
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