Karmaloop, the multi-platform web retailer that specializes in streetwear, filed a voluntary petition for Chapter 11 bankruptcy court protection in Delaware this week. Karmaloop founder and chief executive officer Greg Selkoe said the filing, which lists between $10 million and $50 million in assets against between $100 million and $500 million in total debt, is not related to "a problem with the core business," but is, instead, "related to debt from over-expansion in some areas.” He further stated that the core business continues to do well and “is profitable," but that he was a “little overambitious” on some of the ventures that didn’t pan out.
As for the court auction of the business, Selkoe said there is interest from a few potential buyers. One name that has been suggested: Kanye West, who is rumored to be interested in trying to buy the company. Selkoe told Boston Business Journal “We’ve heard from Kanye West and Damon Dash, and others, too. There’s a lot of interest in Karmaloop and we consider that a good thing.” And as of this morning, we've learned that West and Dash have bought in.
Damon Dash confirmed via an Instagram video that he and Kanye West have purchased Karmaloop. In the video, Dash says, "We decided to go buy Karmaloop. We just talked about it, so it's going to happen."
This is not the duo's first venture into fashion. While we all know about Kanye, you may not know that Dash was one of the co-founders of Rocawear, an American clothing manufacturer based in New York; he has since sold off his stake in the company. Moreover, he had a hand in the launch of designer Rachel Roy's eponymous label in 2005.