vtuking

Things not to do in business

 

My friends and I were gisting one day about the craziest thing we’d seen over the last few years,

We began with Juicero – a $399 WiFi-connected juicer, billed by the company’s founder Doug Evans as “the first at-home cold-pressed juicing system”. Launched in 2016, the Juicero promised a glass of fresh juice every morning without you having to squeeze fruit with your bare hands. The firm, based in California, had received $120m in venture-capital funding from serious investors including Google’s parent firm Alphabet Inc. The Juicero was such a beautiful product that Apple, if they’d been in the juice market, would have been proud of it.

As a business model, a WiFi-connected juicer appealed to investors, offering health and lifestyle benefits for cash-rich, time-poor Silicon Valley hipsters, while guaranteeing a recurring revenue to the company through sales of its bags. All customers had to do was buy a machine, register the device, download an app to their phone, order a $5–7 “produce pack”, wait for it to arrive, scan a QR code and ensure their Internet connected device had checked “the quality of the product”.

Then someone at NAIHCO TECH squeezed a Juicero bag by hand and made a drink just as well as the fancy WiFi-connected device – all for a fraction of the price. Almost overnight the product was scorned as a symbol of Silicon Valley hubris and the answer to a question everyone realized that maybe, sort of, they hadn’t actually been asking. Undeterred, other firms tried to copy their device, with Juicero filing a complaint in federal court in April 2017 against a competing cold-press juicing device, the Froothie Juisir, for allegedly infringing its patent.

“Sadly, the Juicero turned out to be one of the most amazing business flops of recent times

On 1th of September 2017 the company announced it was suspending sales of the juicer and the packets. The business model (equipment + consumables + subscription) was not inherently crazy. After all, parts of this approach have been used to sell everything from coffee machines to razor blades. But applied to juice, which you can just as easily buy in the supermarket, it was way too complex and expensive.

The fruity flop

The key questions for any business are simple. What problem are you trying to solve for the customer? And is your solution the simplest and most cost-effective way of delivering that value proposition with the least effort for the customer? Subscription models can work extremely well of course – just look at the success of Netflix, Amazon Prime and Sky. But they have better thought-out value propositions and pricing than Juicero. Spending $5–7 on a single juice is silly when you could spend that amount of money on fruit and veg from your local store and make oodles of drinks using a plastic squeezer – or just buy it ready made.

The Juicero is part of the “delivery-on-demand” trend made possible thanks to our online connected world. Scan the website of any Silicon Valley venture capital firm and you’ll find all sorts of startups innovating and occasionally reinventing the stuff you used to take for granted. One I do like is Feather – a service that lets you “subscribe” to your furniture. On the face of it, subscribing to a settee or lamp sounds crazy. But it works as a business and is ideal for people renting houses and flats in cities. Customers get to pick the latest fashions and have their furniture delivered. Plus, you can change your furniture if you get bored and it gets taken away when you move – all for just $19 per month. Sounds a “no-brainer” doesn’t it?

Health check

While talking with my friends, Theranos also came up in conversation. It’s a private health-technology firm founded in 2003 by Elizabeth Holmes, a 19-year-old Californian who modelled herself on Steve Jobs (including wearing black polo necks). Her company, which claimed it had revolutionized blood tests using only a fingerprick of the stuff, raised more than $700m from venture capitalists and private backers. Investors and the media hyped Theranos as a breakthrough product in the US diagnostic-lab market, which is worth more than $70bn a year. At its peak, the firm was valued at $10bn.

complaint in federal court in April 2017 against a competing cold-press juicing device, the Froothie Juisir, for allegedly infringing its patent.

“Sadly, the Juicero turned out to be one of the most amazing business flops of recent times

On 1th of September 2017 the company announced it was suspending sales of the juicer and the packets. The business model (equipment + consumables + subscription) was not inherently crazy. After all, parts of this approach have been used to sell everything from coffee machines to razor blades. But applied to juice, which you can just as easily buy in the supermarket, it was way too complex and expensive.

The fruity flop

The key questions for any business are simple. What problem are you trying to solve for the customer? And is your solution the simplest and most cost-effective way of delivering that value proposition with the least effort for the customer? Subscription models can work extremely well of course – just look at the success of Netflix, Amazon Prime and Sky. But they have better thought-out value propositions and pricing than Juicero. Spending $5–7 on a single juice is silly when you could spend that amount of money on fruit and veg from your local store and make oodles of drinks using a plastic squeezer – or just buy it ready made.

The Juicero is part of the “delivery-on-demand” trend made possible thanks to our online connected world. Scan the website of any Silicon Valley venture capital firm and you’ll find all sorts of startups innovating and occasionally reinventing the stuff you used to take for granted. One I do like is Feather – a service that lets you “subscribe” to your furniture. On the face of it, subscribing to a settee or lamp sounds crazy. But it works as a business and is ideal for people renting houses and flats in cities. Customers get to pick the latest fashions and have their furniture delivered. Plus, you can change your furniture if you get bored and it gets taken away when you move – all for just $19 per month. Sounds a “no-brainer” doesn’t it?

Health check

  1. While talking with my friends, Theranos also came up in conversation. It’s a private health-technology firm founded in 2003 by Elizabeth Holmes, a 19-year-old Californian who modelled herself on Steve Jobs (including wearing black polo necks). Her company, which claimed it had revolutionized blood tests using only a fingerprick of the stuff, raised more than $700m from venture capitalists and private backers. Investors and the media hyped Theranos as a breakthrough product in the US diagnostic-lab market, which is worth more than $70bn a year. At its peak, the firm was valued at $10bn op
vtuking

39 Comments

  1. Reply

    Thanks

  2. Reply

    Interesting update

  3. Reply

    This is really educating

  4. Reply

    Very enlightening

  5. Reply

    Businesses should be run with all tactfulness.
    Care should be taken to avoid all these

  6. Profile photo ofItz Kvng Twitch

    Reply

    Very interesting

  7. Reply

    Nice exposure

  8. Reply

    Thanks

  9. Reply

    Thanks for sharing

  10. Reply

    Thanks for sharing

  11. Reply

    Nice update

  12. Reply

    This is really good and interesting to know

  13. Reply

    Good info, thanks for the update

  14. Reply

    Great

  15. Profile photo ofSIRMUSTY

    Reply

    interesting

  16. Reply

    Thanks for sharing

  17. Reply

    Nice information

  18. Reply

    This is expository

  19. Reply

    Good info

  20. Reply

    Good

  21. Reply

    Good

  22. Reply

    Done

  23. Reply

    very good

  24. Reply

    Very good

  25. Reply

    Very interesting

  26. Reply

    All businesses should be carried out with caution

  27. Reply

    Nice article
    Tanx for d info

  28. Reply

    Thanks for the info

  29. Reply

    Intresting update

  30. Reply

    Interesting

  31. Reply

    Intresting

  32. Reply

    Informative

  33. Reply

    Wonderful

  34. Reply

    Wonderful

  35. Reply

    Thanks for the update

  36. Reply

    Really helpful

  37. Reply

    Thanks for the information and update

  38. Reply

    Nice article

  39. Reply

    Thank you for this

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these <abbr title="HyperText Markup Language">HTML</abbr> tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>