Vinfolio calls in new investors after cash flow crisis

A group of investors led by former Constellation CEO Jon Moramarco have acquired the company’s secured debt and the business is still running. 

First news of problems at Vinfolio appeared last Friday on eRobertParker.com when it was reported that a Vinfolio cheque had bounced. By that afternoon the company’s CEO Steve Bachmann wrote on Vinfolio’s blog:

“A few weeks ago, we found ourselves in need of additional capital on a very near-term basis. The company investigated several options but new capital could not be obtained on a necessarily compressed timetable. 

“Because of the situation, and to safeguard the interests of our customers and creditors (including for wine purchases, wine sales, and wine stored with Vinfolio), the board of directors and the shareholders of Vinfolio approved and undertook a form of restructuring known as an Assignment for the Benefit of Creditors on Friday evening, January 15, to provide the business with the flexibility to develop the appropriate course of action going forward.”

Vinfolio remains operational while Moramarco and his team try to put together a new business model. 

"The lights are on and we’re operating and shipping wine,” Jay Moore, vice president of marketing, is reported to have said.

Apparently the company has almost 500,000 bottles of wine in its warehouses.

Moramarco, the managing partner of wine industry advisors BW 166 LLC has offered the following guarantee to those who have bought or sold wines through Vinfolio. 

“As a secured creditor we’re trying to take every step we can so that people are paid for their wines and get the wines they purchased. It will take a little bit of time to sort out.”

The San Francisco-based company was founded in 2003 and raised US$4.5 million in September to fund an expansion in Asia.

 

Patrick Schmitt, 21.01.10