Posted on June 22, 2015
Short story of 3 interesting startup ideas, that died a horrible way.
Sometimes you meet this beautiful, interesting girl you would like to marry someday. You are after few dates, everything goes as smoothly as possible, it looks like eternal happiness is just a day away… and then ‘bam!’, she tells you and your friends, that she believes in unicorns. You are trying to convince yourself that it might still work, that you can overcome it with your passion for her.. but sooner or later you finally realize, that sometimes it just can’t work, even if the initial premise is heavenly great. In the article below, I’m going to show you some of the beautiful startup ideas, which proved to believe in unicorns (or condom keychains).
- King of the Condom Keychains (the story of.. well it doesn’t need an introduction)
There is an old urban legend which says, that if you repeat the word ‘Candyman’ five times, while looking straight into a mirror, a creepy beekeeper (aforementioned Candyman) will appear and steal your precious soul. I’m not a very superstitious man, but even though I have never mustered enough courage to try this idea. Same goes for starting a business based on selling condom keychains. In a pretty distant land(Thailand), a young prince(Stanford University alumni), had a dream about glass houses(condoms strapped to keychains) and jumped right onto this occasion.
A man with vast startup experience, saw a warehouse full of condoms, that were soon to be expired. Thai visionaries sealed them in plastic bags and created first ever condom keychains. The young businessman believed, that it would become the next Pet Rock(if you want more – click) and started to work on popularizing this idea on a bigger scale. He encountered several problems, such as ‘slippery accident’ during the transportation of aforementioned condoms from Thailand to USA, paperwork troubles etc. People were excited, there were many potential buyers, in other words – everything seemed to be great. What finally killed that startup wasn’t even the need to include a ‘How to use’ guide to each condom keychain. The author says, that ‘it’s tough to get rich quick with a single item’, and ‘a markup of 150 percent doesn’t mean much when you’re only making 75 cents per item’. In the end, after 2 years of working on this business the author was 10k $ below his starting capital. Sometimes it just won’t work.
- Webvan (the story of a too fast commitment)
One rainy morning, long time ago(1999), a great idea emerged from the void – why don’t make a business of selling groceries online and then delivering them to customers? People are naturally lazy, this should definitely work! Webvan even offered a delivery in time no longer than half an hour. The ‘I believe in unicorns’ moment came, when Webvan CEO, started to believe in his idea too much. He bought a great fleet of trucks, provided lots of expensive equipment to his offices, invested really big money in marketing and then.. silence. It has shown to be a one sided love, customers never came and the beautiful story ended in 2001. What happened? There are two theories. First one – Webvan was just ahead of it’s time and a second one – the CEO invested too much and too fast, while not letting his startup slowly develop.
- Pay By Touch (the story of choosing wrong person)
Let’s say that your product is great and profitable, it’s worth committing to and have bright future, what can go wrong then? Well, sometimes you can be the problem. And basically, that’s the story of a startup from 2002 – Pay By Touch. Idea was really promising – wouldn’t it be great, if people could pay for their shopping using just a swipe of their finger? Remember, we are talking 2002 – the idea sounded really innovative back then. What happened? They became a hot topic, raised big money and were ready to really take market by force, but.. the bad CEO happened. The head of Pay By Touch proved to be a criminal, accused of defraudation of company money, drugs and abusive behavior. After a long struggle and then painful agony(which ended in 2007), CEO problems finally sinked this promising startup.
Those are some of the best known stories around. If you know any other ‘good startup went wrong’ cases, please put them in a comment section below.
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