Auctionata, the Berlin-based art and luxury goods startup, has been forced to close, the online auction house announced on Tuesday.

“Following the conclusion of its preliminary insolvency proceedings Auctionata Paddle8 AG will cease its German operations under the Auctionata brand,” a press release states, “as sufficient funds for maintaining the going concern could not be found.”

Of the 170 employees in Berlin, 30-40 will remain. CEO Thomas Hesse, who only joined the company in October 2016, is among the outgoing employees.

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After reaching an agreement with the preliminary creditor committee, administrator Christian von Brockdorff will begin the liquidation proceedings on March 1.

An Auctionata live auction in progress. Photo courtesy Auctionata | Paddle8.

The loss-making subsidiaries Paddle 8 and Value My Stuff have already been sold to investors in the US and UK, and will continue to operate independently of Auctionata.

The closure affects a number of prominent investors such as Earlybird, German Startups Group, HV Holtzbrinck Ventures, Hearst Ventures, and Groupe Arnault. Collectively, they provided over $130 million in venture capital. Last year, there was even talk of an IPO.

But a peek behind the curtain offered a different story. Auctionata has been in decline since news of serious trade violations perpetrated by co-founder and former CEO Alexander Zacke came to light in March 2016, when Zacke and Auctionata board members were accused of illegally bidding on their own auctions.

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Months later, reports of business difficulties at Auctionata emerged after independent evaluations of auction results suggested that the house was making only very few direct sales. At the time, the company insisted that the figures didn’t take into account private sales and other revenue streams.

Nevertheless, Zacke left Auctionata in October 2016, and was replaced by former Bertelsmann executive Hesse, who was ultimately not able to save the company despite extensive restructuring.