Less than a decade ago, the biz was worth
half-a-billion dollars. Why’d this Titanic sink?
Once upon a time, ol SurfStitch was the darl of the surf
world. Launched in 2008 by surfer entrepreneurs Justin
Cameron and Lex Pedersen, SurfStitch became Australia’s premier
online surf and streetwear retailer and by 2014 was valued at half
a billion dollars.
However, it was unravelled by bullish overexpansion. Sunk by
hubris etc.
A $155 million loss in 2016 was driven by the disastrous
acquisition of FCS, Stab, Magic Seaweed and Coastalwatch and
shareholder lawsuits over inflated forecasts.
By 2017, shares had crashed from two bucks to six pennies
apiece, and SurfStitch entered voluntary administration, dubbed a
“total collapse”.
As reported by The Australian,
“The long-troubled surf and sports products online retailer
SurfStitch has collapsed into voluntary administration, ending the
public life of one of the worst floats on the market in recent
years, leaving its shareholders likely facing a complete loss on
their investment.
“SurfStitch has the ignominy of being one of the worst
performing floats in recent times. Set at an IPO price of $1 when
the company floated in late 2014, the shares soon crashed following
a string of profit warnings, class action law suits, failed
acquisition strategy and then the shock loss of one of its
co-founders and co-chief executives Justin Cameron soon after its
float.
“The cracks started to show in SurfStitch soon after it floated
on the ASX, with the company plunged into turmoil in March 2016
when Mr Cameron quit via a one-line email to the board, as he
joined forces with a private equity firm to launch a possible
takeover of the group. SurfStitch, led then by chairman Howard
McDonald, had been scrambling since to regroup executives and
integrate the businesses that SurfStitch bought up since its $83m
float in late 2014.
Alceon Group acquired it in 2018, folding it into Alquemie
Group, but recovery stalled. In 2023, Alquemie posted a $2 million
loss, down from a $3.2 million profit, amid redundancies and a
failed SurfStitch rebrand.
And, now, the SurfStitch website has been inaccessible for at
least two weeks, prompting speculation about the online retailer’s
future.
Customers have reported delays in receiving orders, with some
waiting weeks for their surf themed trinkets and branded
Bangladeshi-made tees.
Social media posts on SurfStitch’s Instagram and Facebook, the
first in six months, have drawn furious comments from frustrated
shoppers.
Alquemie Group, SurfStitch’s parent company, declined to comment
on the situation, though a spokesperson says all customer orders
have been fulfilled and no outstanding service inquiries
remain.
Industry observers are questioning whether SurfStitch may cease
trading, but no official statement has confirmed this.
