Fab, the shape-shifting online retailer, today announced yet another new identity. Along with the teams from European furniture companies One Nordic and MassivKonzept, Fab is launching a new brand called Hem—Swedish for "home."
Hem plans to launch this fall with an initial assortment of 300 standard home products, including tables, sofas, and shelves, priced at half the cost of goods at comparable retailers. But unlike traditional furniture companies with online storefronts, Hem aspires to be ecommerce-native in the way that its products are designed, shipped, and assembled. Like the One Nordic Bento chair, many items will ship flat-package and come together without screws or adhesives. And with online tools similar to the ones now available on Fab Europe, customers will be able to tailor products to their own size, material, and color specifications.
"We are excited to shake up the home furnishings space and believe we have just the team to do it," Fab CEO Jason Goldberg tells Co.Design in a statement. "We are creating a new kind of home company that delivers more of what people want—good design, provenance, affordable prices, and multi-point shopping opportunities." The goal of Hem, its founders say, is to "bring joy to people everywhere" through well-designed and affordable furniture.
By all accounts, joy has been notably absent at Fab for the last year. Goldberg, already notorious for his swashbuckling blog posts about entrepreneurship, garnered additional attention earlier this spring when the media jumped on an internal memo he posted to his blog, and then subsequently removed. Its title? "It’s a fucking startup. Why are you here?"
Many employees, as it happens, were not: Fab has fired staffers by the dozens since abandoning its flash-sales based model in favor of becoming an "online lifestyle shop," a change in tack announced last September that has yet to pay off. At its peak, the company grew to over 500; today, Crunchbase estimates its headcount at under 50.
With Hem, Fab will need to lean heavily on the shoulders of its European talent. It acquired MassivKonzept, a German store for custom furniture, last spring, and earlier this month bought One Nordic, the Finnish design firm lauded for its easy-to-ship, easy-to-assemble products.
"Furniture is one of the last frontiers for online shopping," says Petrus Palmér, part of One Nordic’s founding trio (and a Co.Design 50 honoree). "We think about how to ship something big in a small package—without instructions, manuals, cursing. Making that a nice experience—that’s largely design and development."
As for working with Fab, he is circumspect. "If you’re trying to change the furniture industry, it’s an adventure. You’re bound to have ups and downs," Palmér says. "We’ll have a lot of added firepower with the acquisition, because they already have a lot of resources and know the online experience."
Last summer Fab raised a $165 million Series D. To date, it has raised $336 million.
Hem provides Fab with an opportunity to double-down on the custom furniture business it has built on the back of MassivKonzept software. Custom furniture, once the purview of high-end buyers, has become increasingly affordable thanks to 3-D printing, and now falls within the realm of affordable luxury that Hem seeks to claim as its own. The company declines to share custom design sales figures, but says Fab Europe sales in the category have been "strong," an assertion that ex-Fab employees corroborate. According to a Fab spokesperson, everyone on the MassivKonzept team is transitioning to work on Hem.
Despite that glimmer of potential, there are already flashes of the old Fab in the new brand. When the site opens for business this fall, it plans to reach more than 30 countries in Europe and the U.S.—an echo of the adrenaline-fueled growth that preceded the company’s past flare-outs.
As for the existing Fab brand, the company says it will continue to operate in the U.S. "They are building a global iconic brand that can be a $10 billion to $20 billion business," Fab investor Geoffrey Prentice, a venture partner at European firm Atomico, told Fast Company during the site's early heyday. These days, that heroic vision has been brought down to earth and reduced to something more pragmatic: survival.