They started in 2013, long after books like "Four Steps to the Epiphany" and "The Lean Startup" explained exactly why scaling up before you have traction is a huge mistake. They could have learned the "this isn't working" lesson for an order of magnitude less money. If they had done that, they a) would have had capital to recover from their early mistakes, and b) would have been much better placed to find that low-cost solution.
When I look at a crater like that, I think about the 50+ seed rounds (or 20 A rounds or whatever) that could have happened but didn't because they got high on their own slide decks. They blew up not because they couldn't have discovered these problems, but because they didn't want to.
https://www.cnn.com/2018/04/20/health/romaine-lettuce-e-coli...
Was it overengineered? Yes and they wasted a lot of money. But my point is that there were reasons that weren't completely insane.
Not to mention that even this doesn't require anything fancy. The screw press was invented two thousand years ago by the Romans to make JUICE!
It was ridiculous on the surface, but also ridiculous all the way through to the core. We eat a lot of perishable items, and we have a well understood mechanism for dealing with it: Expiration dates. Making the expiration date into a QR code that gets scanned and then sent to a server so it can be checked by a computer is a thing you can do, but you can also just put it on the packaging, the way every other item in your pantry and fridge do.
If you really wanted to be crazy, you could encode the expiration date in the QR code and check it that way - again, without a net connection.
> But once it was set up, the plan was to scale out and lower prices through higher volume.
Not a bad plan. But as has been pointed out ad nauseam at this point:
1) One of the reasons the price was high is that the machine was poorly designed and hideously over-engineered. Relying on prices to drop as your volume increases is great, but if you do an even mediocre job at product design, you need to rely on a lot less volume.
2) The fundamental idea of the machine wasn't very good. A supply chain to ship bags of high quality juice to people? Great idea. A fancy machine to (effectively) open the bag? Not a great idea.
> But the idea wasn't absolutely stupid.
There were elements of the idea that weren't absolutely stupid. But taken as a whole, as implemented by Juicero? ...yeah, it was absolutely stupid.
Let's be clear: The business model was selling a hideously expensive gadget for very high prices, so that you could then sell the buyer a bunch of juice packs. Selling a cheap gadget for high prices and abandoning the juice packs might have been a good strategy (albeit scummy); the mainstay of stupid infomercial gadgets. Selling an expensive gadget for a low price so you could make it up on the juice packs might have been a good idea (it's a tried and proven strategy). But an expensive gadget at an expensive price, so you can sell juice? All you're doing is crippling the sales of the juice packs.
> Did they make pure business strategy mistake? Yes, just like other companies.
Just like other failed companies, yes. The only companies to succeed after that level of strategic failure were the ones lucky enough to pivot. This wasn't a viable idea!
> If you could lower the price of green juice to the price of a Starbucks latte from $15
I dunno about where you live, but around here a green juice from a juice bar is already a lot closer to a Starbucks latte than to $15, and the Juicero packs were actually more expensive than just going to a juice bar.
You're totally right that cheap, high-quality juice for the masses is a viable idea. And you're right that initial high prices, falling due to volume is a good idea. What I think you're missing is how little these things have to do with Juicero.
The expiration of these packets were measured in days or maybe a week, not weeks. Also, as I mentioned above in another comment, there could be particular product recalls like the current romaine lettuce recall. I'm not arguing that it wasn't overengineered, I'm just pointing out why they did it. I wouldn't have done it, but they chose to.
> One of the reasons the price was high is that the machine was poorly designed and hideously over-engineered.
It was totally overengineered. When my friend read the product breakdown from one of the blogs about how it was as if completely unexperienced mechanical engineers had designed the press, she said this wasn't too far off the mark. But the main reason for the failure wasn't the press, it was the food supply chain. That was way too intensive and expensive and wouldn't scale the way they wanted it to. They spent money on food scientists to make sure that the combination of vegetables they used wouldn't interact during the time that they were packaged together, etc. The people they were marketing to were pretty price-independent. $600 for a dumb press wasn't a big deal if they got a great green juice, which they did. Their phase to expand and lower the price was in the future, before they died because funding dried up.
> Just like other failed companies, yes. The only companies to succeed after that level of strategic failure were the ones lucky enough to pivot. This wasn't a viable idea!
Firstly, 90% of all startups fail.
I never said it was a viable idea. I thought the idea wasn't good. But the investors took a chance. That's how it works. Even YC admits that the idea is less important than the people who are attempting the startup. The founder had fundamental experience with launching juice bars on the East Coast, and the idea to create a new market wasn't horrible. Investors took a chance, and then the management fucked it up.
And yes, you can laugh at how dumb the idea is now, but the same goes for Soylent, or even the infamous Dropbox comment in HN. But at least their idea wasn't just "sell $600 juicers ad infinitum and make $$$$". That's my point. A lot of the article miss this.
Juicero is just another failure like all other failures we see all the time in Silicon Valley. There are far worse examples of bad investments out there. I'm sure it's definitely in the bottom quartile of bad investments, but in my opinion it's not like it's the worst ever and doesn't deserve the level of humiliation associated with it. It was just a mismanaged idea that got bad press and then the Internet Lynch mob jumped on it.
I don't know if you can give this as an example in support of internet connectedness - we seem to be doing OK with the romaine lettuce issue without overpriced IoT salad bowls.
That isn't a particular hurdle. There are plenty of products in my local supermarket that have an expiration date measured in hours after purchase (usually about 3 or 4 days in total, the sticker is printed on-location, this especially concerns some raw meat products).
>Also, as I mentioned above in another comment, there could be particular product recalls like the current romaine lettuce recall.
That might require an internet connection but not permanent either. The juicer could simply have a blacklist of product IDs. Supermarkets also already implement this at the checkout. The cashier will be unable to add the item to the bill, even if a supervisor gets out their admin keys and tries it manually (the computer will even block same-price manual entries after a blocked item is scanned during checkout).
In the lean startup world, people talk about early products in "painkiller vs vitamin" terms. If you're going to build a new kind of business, you want a product that people are desperate to have. If it's a nice-to-have, it's much harder to find enough early adopters to build a sustainable business. (Not impossible, but it takes a lot more capital and is much riskier.)
Juicero was literally a vitamin play. Nobody needs it, but some people like it. Coffee, on the other hand contains an addictive stimulant that 60+% of Americans consume every day. People need their morning coffee, and will literally develop headaches if they don't have it often enough.
Juicero=Nespresso is one of those comparisons that only makes sense if you don't think about the details. Sure, it's got some surface plausibility, but only if you don't think much about the details.
Overall, I never liked the idea, and I told her that. I said it was way too expensive and they would have to decrease the price by 80% for it to be viable. But for the people who got it, mainly celebrities and millionaires, they loved it. I think I remember that Beyonce or Katy Perry or Britney got it for all of her dancers, etc.
The entire "green juice" industry is large, and the founder made his first millions by selling chains of these types of juices. The target was to make a glass of green juice less expensive than what you would find at a high-end gym or juice shop. The plan was to build it out with the people who were willing to pay for them, like celebrities and influencers, and then make them mass-market. The biggest expense was getting the food chain up and running, trying to get enough local farmers, etc, and getting the freshest ingredients possible. The internet connection, while ridiculous on the surface, was necessary to ensure that the ingredients were still fresh, because they literally had no preservatives. They wanted to avoid having people drinking a glass of mold or worse especially if they weren't mindful of expiration dates. This could also help if they sold these presses to juice shops (a later business strategy) and the person selling the juice might have old expired stock.
But once it was set up, the plan was to scale out and lower prices through higher volume. Unfortunately, the bad press hit just as they were doing a round of funding and went bankrupt soon after because funding dried up.
Do I think it would have been a hit? Probably not. But the idea wasn't absolutely stupid. It's about the same as any other Silicon Valley idea I've heard. Cater to a very select market of influencers first, and then scale out and create a new market based on green juices. The company absolutely believed that green juices would help the world, because it's a lot healthier, etc, so if you buy into that mindset that they could create a new industry, then it made sense.
Did they make pure business strategy mistake? Yes, just like other companies. Did the founder have too much of a Steve-Jobs-Deity complex by trying to over-design the press? Yes. But it's not nearly as bad as people believe from the headlines. The goal was to create a new market, like how Uber created a market by lowering prices for ridesharing. If you could lower the price of green juice to the price of a Starbucks latte from $15, then they really felt like this company would be a tremendous success.