Fab CEO Reveals The Site Was Burning Through $14 Million Before Massive Layoffs

The CEO of Fab, the troubled online fashion and retail site, spoke publicly for the first time Monday since his company was hit by a series of well-publicized layoffs and financial problems.

Speaking at TechCrunch Disrupt London, Jason Goldberg summed up his troubles in one explicative sentence: "E-commerce is a b**ch."

In the last 15 months, Fab laid off 565 employees, dropping from 750 to 185 employees. Selling products online is a "hard business to be in," Goldberg said.

Goldberg referred to 2012 as "peace time" for the e-commerce site. But everything changed as the company's fortunes looked bleak and Goldberg was forced to lay off hundreds of his staff. Goldberg revealed that Fab was burning through $14 million a month at its peak. "It was an excruciating year," Goldberg said of the layoffs. Talking about the process he went through to lose staff, Goldberg explained that "every single person in this room can go out tomorrow and get another job, I can't. This is my job."

In July 2013, Fab raised $150 million in funding. But according to the company's founder, that wasn't the company's original plan. Instead, Goldberg said that the company had intended to raise $300 million, and the shortcoming in funding meant that he had to change his business plan.

Fab famously grew at a very fast rate, eventually reaching a billion dollar valuation. But, according to Goldberg, "that story doesn't exist anymore." Now, Fab has changed dramatically. The company has spent millions on a new project: Hem. Hem is an online furniture dealership that sells custom-made furniture from companies owned by Fab. Goldberg says there's been a "dramatic change" as the company has cut its monthly outflow from $14 million to just $1 million. And as for Fab, Goldberg insisted that the company still exists, and is operating "around breakeven."