Airhouse makes ‘major layoff,’ transfers customers to partner 3PLs

The shakeup at the fulfillment provider happened after a potential funding round fell through, CEO Kevin Gibbon announced. Fulfillment provider Airhouse made a “major layoff” and transferred customers to third-party logistics partners in April after a potential funding round fell through, CEO and co-founder Kevin Gibbon announced in a LinkedIn post Wednesday.

The company was on the brink of closing the round before it collapsed at the last minute, instituting the layoff on April 12, Gibbon said. The number of people Airhouse laid off wasn’t specified, but the reduced headcount meant the company couldn’t support all of its customers.

Airhouse relies on partner 3PLs for warehousing goods, and it decided to transfer its customers to work directly with the 3PLs that had been serving their businesses. Airhouse stopped sending over orders to the 3PLs’ warehouse management systems on Monday 29 April.

Gibbon said the company gave affected customers weeks of notice that this was happening, although he added that some are having trouble with the transition. “We continued to push orders to the 3PL without charging them for anything to make the transition as smooth as possible,” Gibbon said. “However, given how much Airhouse does in the background, we knew this was not going to be a smooth transition but we unfortunately had no other choice.”

Airhouse customer Bask Suncare was “left with hundreds of unfulfilled orders, completely scrambling to migrate to a new fulfillment partner” as a result of the changes, founder and CEO Mike Huffstetler said on X Tuesday. Gibbon responded that Airhouse gave Huffstetler specific dates Bask Suncare would need to make the transition by, which Huffstetler disputed.

Gibbon helped launch Airhouse in 2020 after his shipping company Shyp shut down in 2018. Airhouse has positioned itself as a fulfillment platform to help brands with e-commerce operations and logistics, and it saw promising growth in its early days. In March 2022, Airhouse closed an $11 million funding round that included strategic investors Flexport and Easypost. Gibbon said in a blog post about the round that the company had “quintupled revenue” and doubled its headcount.