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Will Mass Layoffs Impact 11 Main Merchants?

The 11 Main marketplace launched by Alibaba last year had mass layoffs on Tuesday. The company isn’t talking, but employees say the San Mateo office is closing and the Chico, California office will remain open, but with a much smaller headcount. The company had also laid off some staff in April in a smaller round.

Alibaba sold the company to OpenSky last month, at the same time acquiring a 37% share in OpenSky. 11 Main had a round of layoffs in April, so how many layoffs this week? We weren’t able to reach OpenSky, and our PR contact at 11 Main did not respond. But one employee told EcommerceBytes that OpenSky laid off 105 people at the 11 Main unit yesterday.

“The money being spent on advertising the 11 Main site, to drive traffic to it, was halted as soon as the sale to OpenSky took place,” said the employee who did not wish to be identified.

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Alibaba had acquired eBay listing tool services Auctiva and Vendio years ago, and it tasked the heads of those two companies to develop the 11 Main marketplace.

Small sellers responded positively, believing the backing of an ecommerce giant the size of Alibaba could help 11 Main succeed.

But many sellers were rebuffed when they tried to sign up. It appeared Alibaba was focused on showing the site was operated by real Americans – the small type of Mom and Pop seller found on “Main Street USA,” but its ultra-selective approach was off-putting, as EcommerceBytes has reported.

The 11 Main site was also plagued by problems, including technical issues, and it also soon discovered that getting buyers was a lot harder than attracting sellers. One wonders if the site suffered from the “too many chefs spoil the broth” syndrome, given that three companies were involved with the site – Alibaba, Auctiva, and Vendio. The head of Auctiva is CEO of 11 Main, the head of Vendio is President and General Manager.

OpenSky has had an ever-changing business model since launching, as Forbes reported in 2013. It wasn’t clear why OpenSky wanted 11 Main, but one merchant who had been listing on 11 Main told EcommerceBytes that after last month’s sale, OpenSky sent them a sales pitch inviting them to participate in its co-pilot marketing program, which required him to fork over an ad budget upfront.

Sellers may be wondering what will happen not only to 11 Main, but to the eBay listing tools still offered by Auctiva and Vendio. Upon hearing the news via the EcommerceBytes Facebook page, a seller asked, “People still use Auctiva?” Other sellers responded in the affirmative.

Some employees told EcommerceBytes that the company has neglected the eBay listing tools. One put it in colorful terms after the OpenSky deal: “OS “claims” that they want to give those products the attention now (after having been shunned and crapped on by the leadership for the last two years!) suddenly they are in the spotlight.” Another said on Tuesday they hoped the tools would now get some much-needed attention.

After the sale to OpenSky last month, 11 Main spokesperson Abby Reyes told EcommerceBytes that Auctiva and Vendio remained “core to the company,” and she said, “we are continuing our investment in these businesses.” But Reyes did not respond to our inquiries on Tuesday. It’s unknown if she was one of the employees that was laid off.

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Ina Steiner

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. Send news tips to ina@ecommercebytes.com.


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