PCH buys the remains of once-hot startup Fab

Two years ago, Fab was one of the world's hottest new companies, raising hundreds of million dollars at a near-billion-dollar valuation.

Then it went bust.

Fab's parent company, Hem, announced Tuesday morning that the remnants of Fab had been sold to PCH, a design and manufacturing company. Insiders say the deal was valued between $15 and $50 million based on PCH's stock.

All of the funds from the sale will be poured into Hem, a new private label furniture company led by Fab's co-founder, Jason Goldberg.

If you want to know what happened to Fab, there's a telling memo from the founder and riveting details about the downfall here.

Here's the release:

An Update From Hem CEO, Jason Goldberg

March 3, 2015

We have some news to share today.

Hem sells Fab to PCH.

Today we sold the Fab part of our business to PCH. This transaction allows us to focus 100% of our resources on Hem. All of the funds raised from that transaction will be reinvested into Hem. The stockholders that originally invested in Fab will continue to hold the same ownership interest in Hem.

I believe that PCH is the perfect partner to carry the Fab brand forward. Renee Wong, who has been the GM since May 2014, will continue to lead Fab. She has built a strong team and she is a terrific operator.

It's personally very satisfying to see Fab land in a great place with PCH. PCH is known for its world-class operations, and its deep appreciation for brand, design, and the customer experience. PCH is the perfect home for Fab.

Onward With Hem.

Since we began this journey in 2011, our mission has always been to make design more accessible - to innovate and introduce design to new audiences and people of all ages. We continue to do that today at Hem where our mantra is: Design Made Easy.

Today, in selling Fab to PCH, we are taking a big step forward in our plan to focus our resources entirely on Hem. We're going all-in on full-stack commerce and private label design.

Hem is well financed and on solid ground.

We are following a specific plan to create a valuable company that exceeds our customers' expectations and that all of our our employees and shareholders will all be tremendously proud of for the long term. These are still early days.

One of my mentors, Hem investor Ben Horowitz, wrote me few months ago to say: "Just build something great." That's our sole focus at Hem: Great products that delight.

We believe we have an exciting future ahead of us.

-Jason