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Activewear Brand Yoga Smoga Files for Bankruptcy

But does the trend still have legs?

Only time will tell but given our propensity toward comfort in the U.S., we’re probably not going to forsake our leggings any time soon. And investors seem to agree. Activewear brands continue to find backing, notably Outdoor Voices, which to date has racked up $22.5 million in funding.

But with so many brands rushing into this space, a shakeout is likely and, based on the stumbles of a few players recently, maybe even imminent.

The latest sign that all may not be well in this wellness space is Yoga Smoga’s recent Chapter 11 bankruptcy filing. According to the Wall Street Journal, this latest legal action follows an involuntary Chapter 7 filing just last month. That petition was on behalf of creditors seeking $3.2 million from the company. Among the petitioners was the brand’s former chairman, Ravi Singh, who has claimed to have covered payroll for the company when funds became tight. Yoga Smoga disputes the amounts sought from the complainants, which include the Ravi Singh 2015 Family Trust, Durga Capital and Sean Gallagher.

Yoga Smoga, according to the Journal, valued its assets between $1 million and $10 million, with debts in the same range.

The activewear brand launched in 2013 with a mandate of offering high-quality workout wear that’s made in America from proprietary fabrications, offering improved performance and durability. The sibling founders, Rishi Bali and Tapasya Bali, have yoga cred dating back to their roots growing up near the Himalayas and business acumen derived from their stints on Wall Street. The company set an ambitious path with plans to open 100 stores by 2018. It currently sells via its website and operates eight brick and mortar locations, according to its website.