economy
CEO of $5B startup once took 'shortcuts' to grow business—until 'alarm bells' went off: Without change, we wouldn't 'have a company'
Faire risked never turning its sky-high valuation into sustainable business — until a moment that caused CEO Max Rhodes to change his approach, he says.
TL;DR
- Faire, an online wholesale marketplace, saw its valuation drop from $12.59 billion to $5.2 billion.
- CEO Max Rhodes admits hubris and a focus on 'vanity metrics' led the company to take shortcuts and become undisciplined.
- Red flags included dropping customer retention rates, increased complaints, and a slowed platform due to excessive supply addition.
- Faire intentionally slowed growth by slashing spending, cutting staff by 20%, and removing customer incentives.
- These changes resulted in increased revenue growth (32% in 2025), improved customer retention, and a projected break-even in the near future.
- Rhodes advises entrepreneurs to check cognitive biases, stay rooted in core values, and listen to their board for reality checks.
- Faire competes with rivals like Ankorstore and traditional physical trade shows, which have rebounded in popularity.