LongRun PBC, a Belmont-based online seller of low-carb and keto products, has filed for Chapter 11 bankruptcy protection. The company operates under the brand name Keto and Co. and sells low-carb and keto foods wholesale through Amazon and its own e-commerce websites. Established in 2014, the company reported $1.34 million in assets and about $2.34 million in debts in a court filing. According to the company, it has no physical location and currently employs only four people.
The pandemic has been cited as the main reason for the company’s financial troubles. The company had a gross revenue of about $9.7 million in 2020. However, its gross sales fell to approximately $8.9 million in 2021, and in 2022, total revenue was just over $5 million. Before the pandemic, the company had been growing at a rate of about 100% per year for six years. Ted Tieken, the founder of LongRun PBC, stated that setbacks are normal in the business, but the company has faced frequent setbacks on top of each other, leading to the perfect storm.
In an affidavit, Tieken wrote that the decrease in sales was caused by various factors, including an inability to raise additional equity financing, supply-chain delays, increases in the cost of promotion and freight, increased distributor deductions, increases in the cost of goods, recalling a product, defending lawsuits, and a decrease in advance rate on its line of credit. Tieken hopes that the bankruptcy filing will create the best economic outcome for all stakeholders, a goal he has had from the start.
The company filed for relief under Chapter 11 in bankruptcy court in Delaware on February 1, 2023. The agreement seeks the use of cash collateral to fund operations, pay operating expenses and payroll, and to provide adequate protection payments to secured creditors, according to a court document. It remains to be seen whether the company can emerge from bankruptcy stronger and continue to operate in the low-carb and keto food industry.
