Boston streetwear company Karmaloop files for bankruptcy

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By Taryn Luna GLOBE CORRESPONDENT

 

Weighed down by millions in debt and by poor business ventures, the Boston streetwear company Karmaloop Inc. filed for Chapter 11 bankruptcy Monday.

Meanwhile, rapper Kanye West and hip-hop entrepreneur Dame Dash expressed interest in buying a majority stake of the 15-year-0ld company, said Greg Selkoe, founder and chief executive of Karmaloop.

“I hope people understand that Karmaloop is not going anywhere,” Selkoe said. “We had a business that was being held back by the debt and it didn’t seem that we had any other solutions.”

Selkoe, who earned a master’s degree in public policy from Harvard’s Kennedy School of Government, founded Karmaloop from the basement of his parents’ Jamaica Plain home in 2000. Karmaloop.com became known as a go-to online boutique for urban streetwear, primarily for men ages 18 to 35.

But Selkoe’s attempts to parlay that success into more than a dozen other e-commerce sites and side businesses ultimately failed and weighed down the company. Several sites that Karmaloop launched, including Monark Box, Boylston Trading, and the female-focused Miss KL, were shut down. The company also pulled the plug on an unsuccessful TV channel.

“We tried to do too many things,” Selkoe said. “We launched too many different sites in too short of a period of time.”

The bankruptcy filing listed $10 million to $50 million in assets and $100 million to $500 million in liabilities. The company owes Insight Venture Partners of New York $8 million and nearly $1 million to Google Inc., among Karmaloop’s biggest creditors.

In addition, dozens of vendors on the company’s marketplace website Kazbah have complained that Karmaloop is often months behind on payments. Consumers pay Karmaloop for the products, which are then shipped from the vendors. The company takes a percentage before passing on the sales.

Selkoe sent a colorful e-mail to vendors last year, saying cash was tight.

“We’re going to be paying people on a weekly basis,” Selkoe said Monday. “It’s a huge step in the right direction.”

In an interview last year, Selkoe said sales had reached $165 million in 2013. Sales for 2014 were about $100 million, he said Monday.

In the bankruptcy filing, Karmaloop said Comvest Partners of Florida and other lenders provided a loan commitment of up to $30.8 million to support a restructuring under the bankruptcy code.

Selkoe said Karmaloop.com, which has more than 4 million monthly unique visitors, will continue to operate. So will its European website StreetAmmo, its off-price members-only PLNDR division, and the marketplace Kazbah.

He said several high-profile buyers, including West and Dash, have expressed a desire to buy the company and keep him in place as chief executive when the business emerges from bankruptcy.

Original Story posted via the Boston Globe

Endangered black rhino trophy can be imported, US wildlife agency says

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A big game hunter who won a Safari permit to kill an endangered black rhino has been granted permission from the US Fish and Wildlife Service to bring home the animal’s head.

Corey Knowlton won the safari permit at an auction, paying $350,000 to the Namibian government. Another permit was auctioned for $200,000, but the hunter who won it was not identified.

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Ironically, the money will go towards Namibia’s wildlife conservation and anti-poaching efforts. The black rhino is a protected endangered species, with only 5,000 left on Earth.

United States citizens make up a disproportionately large share of foreign hunters who book trophy hunts in Africa,” said Dan Ashe, director of the US Fish and Wildlife Service, in a statement. “That gives us a powerful tool to support countries that are managing wildlife populations in a sustainable manner and incentivize others to strengthen their conservation and management programs.”

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Under Namibia’s management plan, which began in 1995, the black rhino population has grown from 2,400 to 4,880 in 15 years. Prior to Namibia’s poaching boom in the 1960s, the country had around 70,000 black rhinos. The program allows for the culling of five old male bulls to support younger males in mating and growing the population.

There is a high demand for poaching rhino horns, since they are used as traditional Asian medicine in China and Vietnam. The horns can fetch as much as $50,000 per kilogram on the black market.

Poachers’ attempts to retrieve the horns have hit news headlines, with some efforts leaving behind gruesome pictures of rhinos bleeding to death. Over 1,000 were slaughtered in South Africa in 2014. The brutal act is often done by subsistence poachers, driven by poverty or hunger, who then hand off the horns to a syndicate.

If the poaching continues, estimates by rhinosurvival.org say the rhino will be extinct by 2025.

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To date the US Fish and Wildlife Service has approved just three permits to hunters to return to the US with trophies. The first permit received little attention, but Knowlton’s permit generated 15,000 public comments and 135,000 petition signatures from conservationists arguing against the culling of a species on the edge of extinction.

In this day and age, sport hunting of any critically endangered species – especially a species that is seeing massive rises in poaching incidents – cannot be supported,” said Kathleen Garrigan, a spokesperson for the African Wildlife Foundation.

Read more via RT here

THE NIGERIA: WHY INSTABILITY IN PAKISTAN MAY HELP REVIVE AFRICA’S TEXTILE INDUSTRY

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It is no secret that the country of Pakistan has been struggling for a long time. The country of around 180M has faced an energy crisis, political division leading to civil unrest and most recently a surge in violence and terrorist attacks. Pakistan is also a country that is labeled a concern for corruption by Transparency International.

While many countries around the world face problems; all of these combined create instability and with that comes higher prices and less foreign investment. Fuel shortages increase costs of transport and it becomes a vicious cycle causing exports to drop.
We now see companies leaving Pakistan after years of business and investment in the country. The most notably as of recent being Walt Disney Company and the Canadian menswear label Kanati Clothing Company.

A recent article titled “Badly Governed to Ungovernable” in Pakistan Today stated “The only way that an ordinary businessman in Pakistan can be ‘successful’ is by hook or by crook, “putting wheels on files” by greasing palms and evading as much tax as possible to keep going. If a businessman wants to become big time he has three options: join cartel-mafias, become a crony-front man of the official Mafia or enter politics and get into government. Try and do it morally and legally and you will come a cropper because morality and legality are singularly absent in Pakistan.”

Pakistan clearly faces some challenges and even though there are some signs things will improve; this will take time. Many areas of the country often go without power and communications for up to 13 hours a day. A looming water crisis is expected to hit this year unless drastic changes are implemented.

Foreign companies have limited protection in Pakistan and it is now being revealed just how many companies are finding the country a concern to their flow of business and no longer willing to manufacture or invest in the country. Pakistan is a country on the decline according to the World Bank’s “Ease of Doing Business” ranking system that places the country at only 128 of 189 countries.

“After much thought and discussion, we felt this was the most responsible way to manage the challenges associated with our supply chain,” said Bob Chapek, president of Disney Consumer Products in a statement.
He added that the decision is based on a recent report from the World Bank, which assesses how countries are governed, using metrics like accountability, corruption and violence, among others.

“As an organization that serves clients globally, we just can’t afford the disruption and down time in Pakistan. Our clients depend on a fast and reliable service. We can no longer wait and hope for improvements in Pakistan” said company co-founder of Kanati Clothing Company Liam Massaubi in a press release. He continued to say “We recognize when it is time to cut losses and move on. There are added benefits of a domestic manufacturing approach where we are able to control all of the variables, which we cannot do in Pakistan”

These problems leave many companies seeking new opportunities elsewhere in the world and many are setting their sights on Africa. Why not? Africa produces close to 10% of the world’s cotton and has one of the largest untapped work force in the world. By 2040, Africa will have 1.2 billion people of working age which will be bigger than India, China and Pakistan.

Many textile companies are taking advantage of this. Swedish label H&M built a factory in Ethiopia and the US company PVH which produces for labels like Calvin Klein and Tommy Hilfiger plan to produce in Kenya. Many Turkish textile firms are also looking at building factories in Africa.

Nigeria’s textile industry collapsed a few years ago and many of the factories were left to wither away and are now in a state of decay. There is hope that the Nigerian textile industry will see a new breath of life. The people are talented and willing to work, there is much more stability than Pakistan and companies can find better pricing and transportation options.

With numerous African countries becoming encouraged to compete globally with some major names in the industry willing to manufacture here, there is also hope trade will improve between African countries and economies will pick up.

Botswana exports to the United States under the African Growth Opportunity Act (AGOA) increased by over 50 percent between January and November 2014.

It is clear that there is much potential for growth and sustainability in the textile market from Africa. Instability elsewhere in the world strikes fear into foreign business and prevents them from meeting their company time requirements.

With big name companies finding Africa to be a key part to their business with a skilled work force, we can expect to see a flow of companies who are unable to find support elsewhere follow. It is an interesting time and a rebirth for Africa in the textile world.

 

Read the original story from The Nigeria here.