Online Wine Subscription Service Winc Files for Chapter 11 Bankruptcy

The online wine subscription service Winc is facing some tough times. Winc was founded in 2012 and is based in Santa Monica, California. While the purchase of wine and spirits isn’t exactly down, Winc’s profits have fallen, which has resulted in the company having to file for bankruptcy protection, reports Crunchbase News (1).

After going public in November 2021 and raising $22 million, Winc has watched its shares reportedly drop by 98 percent. The owners of Winc filed for Chapter 11 bankruptcy protection with the hopes of being able to reorganize and emerge in a better state. In its bankruptcy filing, Winc noted that it had “$50.3 million in assets and $36.8 million in liabilities.”

Winc reportedly made over $72 million in 2021 but “never turned a profit.”

Despite having made $71.2 million in revenue in 2021, Crunchbase News says Winc didn’t collect a profit from it. Instead, it acquired more debt and now owes Facebook’s parent company, Meta about $724,000, possibly for online advertising.

How can Chapter 11 bankruptcy help a business that is in debt?

Those who build businesses often put in a great deal of time, effort, and money to get them off the ground. But when they encounter a financial loss, shuttering isn’t always an option. Rather than throw all that hard work away, some turn to Chapter 11 bankruptcy as a way to help them regain their footing and potentially come out of it all in a much better state.

You see, when a business files for Chapter 11 bankruptcy, they are ultimately looking to reorganize while they continue with operations. Because Chapter 11 bankruptcy imposes an automatic stay and allows a business to accept new money, with the right plan, they could emerge from the proceedings with less debt and a chance at surviving.

Is your Alabama-based business in debt and struggling?

If you own a business in Alabama and are worried you might have to close due to the substantial amount of debt you acquired, there may be other options. The Leeds, AL bankruptcy attorneys at Hill, Gossett, Kemp & Hufford, P.C. can assess your circumstances and determine if you qualify for Chapter 11 bankruptcy.

With the help of a Leeds, AL bankruptcy attorney, you may be able to reorganize your debt so that you are able to repay your creditors and continue operating your business. To learn more about how Chapter 11 bankruptcy works and if it is a good option for you, contact Hill, Gossett, Kemp & Hufford, P.C. today to schedule an initial consultation.

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Hill, Gossett, Kemp & Hufford, P.C. can be reached at:

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