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Winc slashes IPO 73% after postponement, bails on “white shoe” underwriters.


Disclosure: Lewis Perdue does not own or hold any stocks, securities or investments in wine, alcoholic beverages, food, hospitality or related companies.


Wine club Winc  — which postponed its October IPO — announced Tuesday it was planning to offer 1,538,462 shares of common stock at $12 and $14 per share, down from from 5 million shares at $14 and $16 per share.


That means its total gross raise would be approximately $20 million at the midpoint of the revised offering range as opposed to $75 million for the original offering. The offering is being moved from the NYSE to the small-cap NYSE American exchange.


Further, Winc has shed its white shoe underwriters  — BofA, Canaccord, Craig-Hallum, Roth and Benchmark — and is now being underwritten by Spartan Securities and Revere Securities.


“That’s very expensive money,” a top-ranking, financial executive told Wine Industry Insight. “After all the bills are paid, I think they will come out with $12 or $13 million.


“They must need the money really badly to spend $7 or $8 million to get $12 or $13 million.

Customer Churn Is Big Money Burn

As Wine Industry Insight  pointed out on October 21, and in previous articles (below) Winc suffers most severely from its unsustainable customer churn, losing 70 percent of its club members on an annual basis.


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