Co-founder Benedict Dohmen confirmed to TechCrunch via a LinkedIn message that “Benitago (or any related entity) is not shutting down its operations. We have not sold or disposed of any assets.” Though the company did make a few acquisitions this year, it shifted gears toward brand incubation and operations, or essentially developing their own brands.

And unfortunately, this decision led the company to cut staff. One former colleague, who wished to remain anonymous, told me they were with the company for only about three months before his department was let go. Dohmen confirmed the layoffs.

“We unfortunately had to reduce the size of our teams by 14%, primarily in the M&A and talent acquisition departments,” he said. “We underestimated the probability and impact of an e-commerce market downtrend. As the world has changed and market pressure for probability rose, we shifted focus towards incubation and operations.”

Dohmen, too, noted that the shift in strategy to focus on brand incubation and operations was “due to the increasing cost of debt.”

The new focus seems to be paying off for the company now. The incubation effort accounts for 20% of Benitago’s business and is growing 88% quarter over quarter, Dohmen said. Consolidated revenue in the third quarter was up 308% from last year, and this quarter “was Benitago’s most profitable and cash-flowing quarter yet,” he added.

The company has since developed five international brands, operates over 10 brands and has more than 300 new products in the pipeline.

Dohmen doesn’t believe Benitago is done with M&A, but does admit that future acquisitions will be “more targeted,” and instead of casting a wide net on Amazon, it “will only seek brands that fit with our current brands’ strategic direction.”

“We regret being overly optimistic and not foreseeing the e-commerce downtrend and the rising cost of capital,” Dohmen said. “We take full responsibility and are sad about the reduction in team. But we’re excited about the brands and products we have in the pipeline, and we’re excited to come out of this recession much stronger.”

Benitago Group exec confirms it didn’t close, but did lay off some employees by Christine Hall originally published on TechCrunch

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