Throughout my career, I was always obsessed with the success stories of companies that have completely exploded their growth and achieved vast success. I have also enjoyed the pleasure of working with and alongside many businesses that were on this road to success, but not all that glitters is gold. And frankly, if have also had plenty of moments where I found myself scratching my head when dealing with clients who were in some cases forcefully trying to make their company work. Arguably, there is nothing wrong with it and I was still as devoted to these companies as I would have been to any others, but it does raise the question: does every company need to achieve growth?
Today, I am going to take you on a journey to the past. To revisit what is in my opinion one of the most epic failures of explosive growth that I have ever had the pleasure of reading about, uncovering its intricacies and finally providing you with insights on how to avoid it. I also want to give a shoutout to Yev Podgatesvky who inspired me to write this article. Now, without further ado let’s get into it.
I am a huge fan of fruit juice myself, especially when it is freshly squeezed without any additives and sugar. It is also why whenever I move apartments I always ensure that I bring my orange juice presser with me. It is not a fancy technologically advanced machine, but it does the trick. Additionally, it is also not the most simple of devices so some form of convenience does come with it. I bought it at a discount store for about $40, and it has served me well all these years. I acquired it right around the same time when Silicon Valley-based startup “Juicero” first started making headlines.
Now, one could argue that there are always ways in which we can improve certain processes. This is what Doug Evans thought when he set out to create the Juicero. Perhaps, he received inspiration from coffee-fanatics (sorry) who always seem to come up with new ways to brew coffee without ever asking themselves “but why”?
Needless to say, and this may be a bit biased but I think that in both cases if these individuals would ever embark on a trip to Colombia they would find both their cravings satisfied with simple methods. I mean in any major city in Colombia you can buy fresh juice that tastes like heaven on every street corner, and if we consider the initial price of the Juicero ($600), this might actually turn out to be the cheaper option. Right.
Back to the story of Doug Evans though… where there is a will there is a way, and so the company set out to produce the Juicero. The announcement came in 2016 that the machine was coming. Also, that its design by Fuseproject, Yves Behar’s design studio based in San Fransisco, was complete. One thing we cannot place fault the studio for is the sheer sleekness of the machine, I mean it does look good. Then there is the question, who went out to design the internals of this machine? One would of course look to the Juicero engineering team and place blame there. But, we also have to understand and emphasize that this would have been a business decision. This massively over-manufactured piece of engineering could squeeze a pack to dump its liquid contains into a cup has been a complete failure. Ben Einstein has completely dissected the machine itself, so have a look at his article here to get a grasp on just how complicated this machine actually was.
Doug Evans his vision of creating the ultimate juice pressing machine did however come into fruition (totally intended), but just because the machine existed did not mean it would become a commercial hit, nor raise money from investors. To understand the fruits of the labor we have to turn to the marketing of the machine.
By now the website itself is defunct, luckily we can access the historical website using the Waybackmachine, which if you are using the Brave Browser is done automatically. And this allows us to analyze the way the company presented itself, and it is nothing short of amazing. At first glance we are instantly exposed to a strong headline: “Press to Feel Amazing”
We are exposed to an almost single CTA which is present above the fold and sends out a clear message “Order online”. For those unmoved by the headline copy, there’s a video which you can watch and if you scroll further down there are more icons that further explain the product, a 30-day “happiness”-guarantee, and Social proof in the form of Top Magazines.
At first glance, there is not a lot that you can latch onto as being bad, mind you if I am looking at this objectively it does a lot of things right rather than wrong. Obviously, now that is only the home page itself. But, I decided to dig a little deeper into the past. Now, for one, the PR bonus of being featured by the newspapers and magazines outlined above certainly helped propel the company to its success – but ironically, most of the company’s funding was obtained prior to the publishing of those articles. And I as often like to argue myself, it was the story that sold the juicer to investors.
Now, I do have to say a lot of the stuff I found was straight up useless for my article. Like, what does Kobe Bryant have to do with Juicero? Turns out that it is actually quite a lot, as he was an investor in the company. Anyway, the dive into the Juicero-rabbit-hole did me a few solid ones as I also uncovered the gem below:
Given the fact that the #fyrefestival and the Juicero link was also one I had made, I had to chuckle at it. Anyways, back to the Juicero rabbit hole and my discovery of some of their marketing materials:
Additionally, I was actually expecting this machine to make a strong appearance on Social media, specifically Instagram. Turns out the #juicero only had 1,967 posts, most of which are totally not worth exploring but some of the more interesting ones I could find are below:
And then you get your typical Instagram individuals posting about wanting/getting the machine and hyping up their own circles as well as a bunch of micro-influencers. Interestingly enough, I did not find any credible information regarding the usage of influencers to promote this product, even though it probably would have been an ideal candidate.
If we dissect the materials that I found, I would argue that there really has not been any kind of mind-blowing innovation in terms of marketing, the creative is okay but nothing magnificent and though this one video does do a good job of creating a “problem” and offering a “good solution”, that’s about as far as it goes. The marketing was nothing amazing.
Regardless of what you and I think of the marketing efforts the company itself was riding a wave of success. According to one final news bulletin from Juicero, it claimed to have sold over a million Produce Packs, priced at $5 to $7. Meaning the company generated at least $5 million in revenue from the packs alone. And that is without the actual sales of the Juicero itself. Without a doubt, this is still inconsistant with the funding the company received. But it is exactly that last part, the investors who made the Juicero happen.
It all started with Doug Evans who approached his former partner and later on got an in at Kleiner Perkins, an investment firm where a single believer invested half a million dollars which kickstarted the road to a Series A financing of $16.5 million. After all, when the ball starts rolling and gains momentum there is no real stopping it, now is there? The company continued to rake in more funds with an additional Series B to top it off and even more funds from private investors. All that money to produce a juice-presser that was just a weight machine that pressed down on a packet of juice that you could press with your hands. Obviously, all credits to the impeccable design of the machine and its marvelous technological interior, which as mentioned earlier were certainly nothing short of amazing.
In the end, though, I think it is good to raise an important question about investment rounds in general. As startups grow and they convince investors to cough up sums of money to help them fund their journey to the top, it inevitably creates a snowball effect. Each group of investors is hoping to cash in back at some point in the future (as with all investments). So, the pressure is on these startups to rake in more money and more clients to create an image of growing success. It is the story of how we end up with unicorn companies that often do not have the cashflow/revenue to become profitable, one of which is expecting to turn a profit this quarter. Of course, I am talking about Uber. Now, you can view this however you want to, and frankly while I am a bit skeptical about every business needing investors to scale, I would be without a job if this trend did not exist.
But perhaps if you have read all this way, you should consider investing in a more traditional business model that makes a profit from the get-go like HK Digital?
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