CEO Brian Lee Won’t Admit That JustFab’s Acquisition Of Kim Kardashian’s ShoeDazzle Was A Bail-Out

 
 
 

Did you guys know there was an “L.A. shoes war” going on? No? Well, PandoDaily says there was, but that it’s officially over because JustFab has acquired Shoedazzle, the subscription women’s fashion site co-founded by Kim Kardashian, for between $10 and $30 million.

Uh…hooray?

According to Pando, the deal between JustFab and ShoeDazzzle is officially defined as a “merger,” although the all-stock transaction was really more of a bail-out for ShoeDazzle, which has raised $66 million in venture capital money.

For his part, CEO Brian Lee  claims the $10-30 million estimate is “completely wrong,” but has not given any hard-number alternatives. Lee started the company with Kardashian in 2009, crafting the $39.99 subscription plan before leaving in 2012. When Lee returned earlier this year, one of his first moves was to cut 40% of staff, as well as launch a “VIP” service that re-engaged many customers and — he says — helped put the brand back on track for financial solvency.

JustFab, also based in L.A., pulls in 30% of revenue in non-footwear fashion categories, and will be opening a 65,000-square-foot office in 2014.

So how much money is Kim pulling in from the sale? Not clear — there’s very little information available about what exact equity she holds, although she has been characterized as more of a “celebrity endorser” than true visionary for ShoeDazzle’s founding. If anything, Kim K.’s probably happy to have the company out of her hair, especially after embarrassing allegations of sweatshop abuse in ShoeDazzle’s Chinese factories emerged in 2011.