Crushpad, the upscale, winemaking service that has allowed hundreds of wine enthusiasts, restaurateurs, wine retailers and small-scale winemakers to craft small lots of wines is closing its doors.
Multiple reliable sources close to the process confirm that the company was desperately seeking $500,000 last week in a last-ditch effort to stay alive after the company's main investor, Bill Foley, refused to underwrite any more of the operation's mounting losses.
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"Their business model melted down with the economy," said one knowledgeable industry insider. "They had a lot of small customers, people who were affluent but not rich enough to weather the recession. And now, they don't have the $10,000 to $15,000 they need to buy their wine."
Another industry observer commented, "There are a lot of people -- from the very rich to the merely well-off who had enough resources to ride out two or three years of severe recession. But now that the economy seems to be in the tank for the long haul, I see a second wave of failures on the way."
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Since last week's unsuccessful effort to raise money, CEO Peter Ekman,has been frantically approaching other wineries and custom crush operations to assume its contracts. Crushpad is also offering bottled wine inventory for sale.
Wine Industry Insight reached out to Crushpad. Former CEO Michael Brill, who founded Crushpad in 2004, stated in an email that this article contained inaccuracies, but that any comment would have to come from CEO Ekman.
"Like a lot of winery operations, we have been faced with some need for restructuring which is now almost complete," Ekman said in an email to WII. "Since I can't stop you from writing an article, I can only ask and hope you will reflect the optimism for the future our clients, shareholders and employees share about our business.
"Your numbers in the article below are unfamiliar to me as well," he concluded without offering any details.
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