Overstock Founder, CEO Announces Sale For Blockchain Focus As Company’s Stocks Begin To Spike
Patrick Byrne, founder and CEO of Overstock, announced that he was working on selling the company in a report from the Wall Street Journal on November 23rd. Much of the mutual opinion is that he is seeking ways to get more involved in blockchain instead, but his departure has had a positive impact on Overstock’s shares. Despite having already lost 66% this year, shares recently went up by 23.26%.
Overstock is one of the most well-known and profitable retail companies that the internet has available. It sells everything from furniture to jewelry, and everything in between. However, their path to making over the company as a blockchain startup accelerator, supported by subsidiary Medici Ventures, has come with many losses.
Since the company chose to support tZero three years ago, the startup still hasn’t held their launch, and is causing Overstock to hemorrhage money every day. Byrne never faltered in his believe that startups will be the future of the Overstock brand, maintaining the $130 million raised for the tZero tokens.
Medici Ventures launched through Overstock in 2014, accepting close to $200 million in investments, and they are far from breaking even. The company took a loss of $39 million in the first three quarters of 2018, adding to the $22 million net loss they sustained in 2017. This year for Overstock, the losses for the first three quarters of the year have added up to $163 million, but the founder seemed to have shifted his gaze to the attractive profits that blockchain could offer.
The public statement of the company states that they do not see bitcoin or cryptocurrency at all as the driver for their business, even after they started accepting Bitcoin several years ago. During the first year, Bitcoin accounted for less than 4% of their profit, while it accounts for about 17% now. Still, Byrne told investors that the company doesn’t possess “significant bitcoin holdings.” Surprisingly, the share price of Overstock has appeared to be almost linked with Bitcoin’s market performance. Since Bitcoin’s 2017 bull run, Overstock has seen a 400% surge.