The past year, however, has delivered inflationary concerns, a slightly cooling used car market, higher interest rates, tighter capital markets and overall economic uncertainty. The timing, it seemed, couldn’t have been better. The COVID-19 pandemic also arrived and turned used car sales into one of the hottest markets. ![]() George Arison, a co-founder and co-CEO of Shift at the time, even wrote a column in TechCrunch outlining how to navigate SPACs, a process in which a privately held company merges via a publicly traded blank check company. When the SPAC boom arrived in summer 2020, Shift jumped at the chance to access more capital. Money was raised, valuations popped and some, including Carvana and Vroom, took the road to IPO. Carvana, Shift, Vroom and Beepi, which shut down in 2016 and merged with Fair, were among the buzziest. Shift was founded in 2014, an era when a number of online used car startups launched in a bid to disrupt the traditional dealership model. How did Shift get here? Let’s turn to the bankruptcy filings. Bankruptcy Court for the Northern District of California. Shift filed Monday its petition with the U.S. The company announced Friday it would file for bankruptcy and said it was shutting down its two physical locations in California. Of course, there are a few twists and turns that may have accelerated Shift’s demise. Shift has estimated that process will cost between $4.1 and $5 million, according to SEC filings. About 144, or 80% of the company’s employees, were terminated last week and 24 are remaining on to wind down operations. ![]() The short story, according to recent filings, is that the company’s deteriorating cash position and inability to obtain further financing drove the company to file for bankruptcy and begin the process of closing down the business and liquidating assets. Shift Technologies, the San Francisco-based online used car startup turned publicly traded company, filed this week for Chapter 11 bankruptcy.
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