The French company that coined “Flash sales,” a phenomenon that has been cloned around the world by the likes of Gilt Groupe and others, has announced it will discontinue activity in the United States just a few years after launching a joint venture with American Express. Vente Privée has built a powerful eCommerce business in France, where it sees 80% of its €1.6 Billion coming in, built off the back of a workaround to the regulation prohibiting retail stores from having Sales outside of the bi-annual 3-week periods dictated.
As reported on Fortune, American Express & Vente Privée had poured $20 Million each into the venture. Sources close to the joint venture say that conflicting culture between the US joint venture and Vente Privée’s founder, Jacques-Antoine Granjon, played a large role in the venture’s failure:
“The founders would hand-pick executives for roles, causing the U.S. team to reshuffle their organization to accommodate, only to have the new hires change their minds. A former employee says the most telling symbol of the culture at Vente-Privée is a mural Granjon commissioned from artist David Mach. It features Granjon and his board as Jesus and the apostles at The Last Supper.” – Fortune
In France, Vente Privée is often cited as one of the greatest startup successes; however, the company’s inability to export itself (its makes up just 20% of its revenue) demonstrates clearly that the company, like many French giants, rode the wave of legislative protectionism to carve out a place in the market. Would Vente Privée be able to compete with regulation around retail sales weren’t so heavy in France? Likely, today; however, their inability to make it work in the US shows the disconnect between the company and the global economy that is the Internet.