The current management of the company had been hoping that a last minute buyer would rescue it, having failed to find necessary funding estimated at around £25 million.
There are reports that at least one creditor will oppose the bankruptcy application on the grounds that the trustees had agreed to give the management until 8th March to find additional funding.
Until recently, LetsBuyIt.com operated a “co-buying” business model. The company negotiated discounts with suppliers or manufacturers which were proportional to the number of buyers it could attract on its site. Items were posted for sale with a price which reduced over a buying period as the number of users who chose the same item increased. The investment in the company to date is around £115 million.
The business model began to prove itself in the run up to Christmas with the company reporting total European sales for 2000 up five-fold on sales in 1999. However, the company ran out of cash before it could break even.
The company was founded in Sweden and is listed on the German tech-biased Neuer Markt, although trading in its shares has been suspended. The company was managed in London and registered in Amsterdam.