Jet.com
The business, the turning points, and the decisions behind them.
01 / WHAT IT BUILT
What the company did
Jet.com was an American e-commerce company founded in April 2014 in Hoboken, New Jersey by Marc Lore (who had sold Diapers.com to Amazon), with Nate Faust and Mike Hanrahan. Its 'smart cart' technology bundled goods to reduce costs, competing with Amazon on price. It raised $820 million over four venture rounds from GV, Goldman Sachs, Bain Capital Ventures, Accel, Alibaba and Fidelity, launched in July 2015, and was acquired by Walmart for $3.3 billion in September 2016. Slumping sales followed, and on May 19, 2020 Walmart announced it was shutting down the Jet.com brand; the site closed on June 4, 2020, redirecting to Walmart.com.
02 / Jet.com FAILURE REASONS
Failure reasons
This was a brand retirement inside a healthy acquirer, not a corporate collapse. After the $3.3 billion acquisition, Jet.com's sales slumped; in June 2019 Walmart transferred most Jet.com employees to Walmart.com and Jet president Simon Belsham stepped down. Jet.com was never profitable, and Walmart's e-commerce division was estimated to have lost around $2 billion in fiscal 2019. With Walmart.com showing continued strength (e-commerce sales up 74% in the first quarter of 2020), Walmart discontinued the Jet.com brand and folded it into its unified omni-channel business. Jet.com teams were absorbed, not laid off.
03 / EVENT HISTORY
Events in the structured record
- Founding and funding
Marc Lore, Nate Faust and Mike Hanrahan found Jet.com in Hoboken, New Jersey; it raises $140 million in pre-launch funding and a total of $820 million over four venture rounds.
- Launch
Jet.com opens to the public with its 'smart cart' price-reducing technology, later eliminating its $49.99 membership fee.
- Walmart acquisition
Walmart agrees to acquire Jet.com for $3.3 billion; Lore becomes president and CEO of Walmart US e-commerce.
- Folded into Walmart
Most Jet.com employees are transferred to Walmart.com; Jet.com president Simon Belsham steps down.
- Brand discontinued
Walmart announces it is shutting down Jet.com, citing the continued strength of the Walmart.com brand; the site closes on June 4, 2020 and redirects to Walmart.com.
04 / CONTEMPORARY REBUILD ASSESSMENT
Difficulty of rebuilding this project today
Material for this section is being gathered and checked. It will appear here once ready.
Overall assessment: Not completed
05 / CAUSAL CHAIN
How the factors connect
- 01
Jet.com raised $820 million over four venture rounds and was acquired by Walmart for $3.3 billion in September 2016.
- 02
Post-acquisition sales slumped; in June 2019 Walmart moved most Jet.com employees to Walmart.com and Jet president Simon Belsham stepped down.
- 03
On May 19, 2020 Walmart announced it was discontinuing the Jet.com brand; the site shut down on June 4, 2020, redirecting visitors to Walmart.com. Marc Lore remained Walmart's e-commerce chief until January 2021.