kitchen & bath | Mar 6, 2024 |
Renovation Angel halts operations

Renovation Angel, the company dedicated to recycling luxury kitchens and appliances, has ceased operations and shuttered its showroom in Fairfield, New Jersey. The abrupt closure comes after a period that saw the business slide deeply into debt with its key vendors and suppliers, culminating in a late February clash between founder Steve Feldman and his now-former employees.

The circumstances of the shutdown are a subject of dispute. What is clear: Renovation Angel was struggling with cash flow. In the fall of 2023, Feldman returned to the business after a two-year hiatus and began making changes to management and operations—pivots he says were necessary to cope with a post-home-boom downturn.

According to several former employees, by February, the company had fallen far behind in paying its freight provider. It also failed to make critical payments to the retailers that consigned imperfect appliances through Renovation Angel—one of which repossessed its inventory. Employees began to worry about the financial health of the business, and when they received an email on Sunday, February 18, informing them of a series of meetings the next day, many feared deep layoffs.

What happened was something stranger. At the meeting, a top manager told employees that Feldman had allegedly already shuttered the business the prior week. However, he had apparently also formed a new company, called Renovation Angel Global, to perform the same function, and they were invited to join. Details of the arrangement were vague. Confusion and anger spread throughout the building.

Feldman eventually joined the meeting and addressed employees directly in a heated discussion that culminated in asking for a show of hands: Who wants a job? There were no takers. As the day progressed, shell-shocked employees began leaving, effectively halting operations. A few days later, several returned to the site to collect a paycheck for their work the week prior—their final week on the job. They didn’t receive one.

Feldman paints the February 19 meeting as a misunderstanding that spiraled out of control, though he acknowledges Renovation Angel was in a tight spot. He says that the company’s cash flow situation had grown so dire that it was unable to satisfy payroll provider ADP’s requirement of two weeks’ payroll upfront. To try to keep the business afloat, Feldman was attempting to quickly transition to a new payroll provider, under a new corporate identity, Renovation Angel Global.

In addition to explaining the payroll transition, Feldman says that the meeting was meant to convey a restructuring plan that would involve a small number of layoffs, cutbacks in guaranteed hours, and the elimination of the company’s 401(k) match.

He says the top manager misrepresented the situation to employees, and that by the time he joined the meeting, “it was immediately apparent that virtually nobody was willing to listen to any explanation of the facts.” He maintains that he did not shutter the company or issue a mass layoff.

Feldman tells Business of Home that he has a plan to restructure Renovation Angel in partnership with a “very large player in the space of reclaiming and recycling.” He declined to name the partner, but said he hoped to have clarity on a deal within the next 90 days. Though the company is deeply in debt and currently nonoperational, he says he is “collaborating with his bank and landlord” to ease the transition.

Customers of Renovation Angel who have an open order or who are in the process of donating items may find themselves in a kind of limbo. The disruption is already affecting designers. Anne Lewis Brewer, an interior designer based in New York, had recently placed her first order with the company for a luxury refrigerator for $1,600. Everything went as expected, until the delivery day arrived—and her fridge didn’t. “I thought it was weird that I hadn’t received a delivery time frame or any sort of communication in the days leading up to the delivery,” she says. “I called every number I could find on their site, but everything goes to voicemail.”

Feldman says that resolving delays with outstanding orders is a work in progress: “We’re working to get all those issues resolved. We’re a very complicated, very labor-intensive organization. The fact that everybody left obviously caused interruption of service.”

Originally founded by Feldman in 2005 as Green Demolitions, Renovation Angel has become a regular fixture in industry conversations about sustainability. The company would take donated or consigned high-end kitchen cabinets, fixtures and appliances and resell them, both diverting them from landfills and giving a different clientele access to brands like Miele and Sub-Zero. For homeowners, the donation netted a tax deduction and a sledgehammer-free dismantling of their unwanted kitchen cabinets.

Feldman, who was inducted into the National Kitchen & Bath Association’s Hall of Fame in 2023, has said that the company has resold thousands of kitchens and diverted tens of millions of tons from landfills.

Through its associated 501(c)(3) organization, Sustainability Angels, the company also passed along proceeds from sales to outreach programs for “at-risk youth, addiction recovery, job creation and social entrepreneurship,” according to its website, though third-party grants had dwindled in recent years as the charity increasingly focused on sustainability goals. (Tax records show that Sustainability Angels issued two grants in 2021 totaling $16,100.)

Following the late February shutdown, Feldman resigned from the board of Sustainability Angels. He recently listed a new charitable initiative on his LinkedIn page, the “Kinder Greener Foundation,” along with a post naming himself CEO and announcing its establishment on February 14 in Beverly Hills, California. Speaking with BOH, he was optimistic that Renovation Angel could continue under a new arrangement with the unnamed partner: “I built the company with blood, sweat and tears, and I want to see it keep going.”

Former employees of Renovation Angel mostly expressed shock at the speed of the collapse, anger at livelihoods suddenly disappearing, and regret that a purpose-driven company had met its end.

“The business was dismantled at a rate you almost can’t believe is possible,” says one, who asked for anonymity to discuss a delicate situation. “But it doesn’t take away from the impact we were making as an organization. And it doesn’t take away from the need and gap that exists in the industry for the reuse of kitchens and appliances. …. I do see a path where [this concept] gets picked up again so we can accomplish the mission we were on.”

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