7 Failed Startups That Were Just Ahead of Their Time
Pioneers get slaughtered and settlers finish.
PHOTO CREDIT: Getty Images
What are some startups that had good ideas but failed? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.
Having been in web development and digital marketing since the mid nineteen nineties, I have seen countless good ideas fail.
In the following examples, I will go wide rather than deep in an effort to give many examples of good, or in some cases even great, ideas that failed.
I will briefly touch upon popular theories as to why these "startups that had good ideas but failed", however, I will not delve deeply into the why, as this was not requested by the inquirer. In many cases there are multiple complexities that may have lead to their demise, which at best would be speculation.
I will also point out a few ideas that had very successful and lucrative outcomes for the time that feel like failures when compared to the market success of their modern day counterparts.
It is important to note that while some of these ideas failed, I would not call the founders of teams behind them failures by any stretch of the imagination.
The consistent theme being that pioneers get slaughtered and settlers finish.
We would be remiss if we did not mention this late nineties start up. Pets.com became the poster child for dot com cautionary tales.
Launched in August of 1998, the premise was simple and straightforward--think Amazon for pet owners. Save money by shopping online and paying less for a plethora of pet products.
With a cute, if awkward, memorable sock puppet puppy as a mascot and a large marketing budget at launch, this site quickly raised $80M in funding.
For a short time the mascot was seen everywhere from the Super Bowl to Conan to Regis and Kathy Lee.
In late 2000, the startup crashed after burning through $300 million in about twenty-three months. More than three hundred people were laid off when the site was shut down.
I would suggest that it was great idea before its time. A trend many dot-com darlings shared in the late nineties just prior to the bubble bursting.
WebVan is another well-known poster child for the dot-com bubble which burst in at the beginning of the millennia.
Imagine shopping at an online grocery store with the selection of Vons, the quality of Trader Joe's, and the pricing of Walmart. And on top of all those benefits, the groceries and household items being delivered straight to your door!
No brainer, right? Are you thinking what I'm thinking? Didn't Bezos make billions with that same idea and become the third richest person alive, allowing him to follow Elon Musk into space?
Before Amazon there was Borders, one of the largest pre-Internet era brick and mortar sellers of music and books. Founded by Louis Borders, a man before his time. Necessity being the mother of invention, Louis didn't need a crystal ball to see that the Internet was eating his lunch. P2P tools like Napster were encroaching on music sales and although Bezos' fledgling start up was yet to show a profit, book sales were beginning to decline.
Louis was a true pioneer and even had a partner named Clark. Kimberly-Clark brought marketing and brand expertise on the journey. But as the adage goes, "pioneers get slaughtered and settlers flourish". Let that sink in for a moment.
Even though WebVan was looking in the review mirror at one of the largest IPO's in history, they were t-boned by the Dot Com crash at the corner of "Market Fit Blvd." and "Pioneer Rd."
In an interesting turn of events, many of the bright minds who launched WebVan have played major roles in Amazon ensuring Jeff's success. Doug Herrington, Peter Ham, Mick Mountz, and Mark Mastandrea are all former WebVan team members who went on to become top Amazon executives and thought leaders.
Louis Borders has gone on to found a new home delivery service called, wait for it, HDS. And while the name isn't exactly new school, he is taking a different route to success this time.
While most start ups these days go to a Venture Capital firm like Consumer Equity Partners and tap angels like Tom Furphy (a former WebVan exec.) for a seed round, Louis is ignoring the conventional route, blazing a new path funding his latest venture through partnership agreements with companies like Toyota, who are excited to be first in line to license new technology being developed by Borders at his new venture.
Have you ever played the game Six Degress of Kevin Bacon? The premise is that everyone is no more than six touch points away from any other person. In the game you try to connect actors to Kevin by listing movies in a chain link fashion until you succeed at linking them. If it takes more than six films, you lose.
Well, in 1997 SixDegrees.com was founded on the same premise: that we are all connected and should post and interact online with our social connections. Considered by many to be the original social network, Six Degrees was followed by Friendster and MySpace, who get honorable mentions.
To call Six Degrees a failure might be a bit of a stretch though, as its $125M sale by founder Andrew Weinreich helped to springboard a long string of successful ventures.
Imagine going to a website and typing in any question you could think of. Seconds later receiving a list of answers and links to websites.
Ask Jeeves was one of the first natural language search engines.
The year was nineteen hundred and ninety-six when David Warthen created natural language technology and partnered with Garrett Gruener. Within a year, the site was gaining in popularity and expanding exponentially.
Many other ideas at Ask Jeeves were genius. As a father I particularly like the AJKids iteration. A safe search engine specifically for kids!
The site was purchased by IAC in 2005 and the name was changed to Ask dot com.
A decade after David and Garrett met, IAC, the new owners, axed their butler Jeeves. In 2007 the site was declared a failure by none other than South Park characters who quipped that nobody in the world uses Ask Jeeves.
The site then changed gears from search to Q&A.
Would you visit a site that allows members to ask questions expecting answers from expert members like this one?
WebTV was one of the most exciting developments in 1996. Imagine a world where you could connected to the web and view content and email without the need of a personal computer. Blasphemy!
WebTV was the first widely available consumer device promising to connect televisions to the internet.
I would also muse that these devices were the predecessor to ChromeBooks and other modern single function devices.
The company was founded by Steve Pearlman a true pioneer and visionary in every sense. Having worked as a principle scientist with Jobs and Woz as well as a division president for Gates and Allen, he is a Gamechanger with a capitol G. Pearlman's biography and long list of accomplishments is worthy of Google-ing as well as ogling.
In 1995 I was a young programmer and had been developing websites for roughly a year. The internet had around 20,000 websites. Home computers were expensive and not yet the widespread, must-have devices they would become.
WebTV delivered on the promise of low cost web browsing without the need of a full fledged PC. Bringing new users online by the thousands, content creators of yesteryear welcomed the device with open arms.
Pearlman implemented coding standards for web tv formatting effectively introducing the idea of responsive websites twenty years before the modern smart phone.
I actually purchased one of these devices under the guise that our company should beta test on the burgeoning platform. The HTML rendering engine was quirky at times and I can only say that fixing display issues was a definite labour of love.
WebTV successfully launched Internet TV category and became an established proof of concept.
The founders exited with a sale to Microsoft for $425 million. In a vacuum, this would appear to be a huge win. However, looking at the plethora of web-connected devices and smart TVs it is safe to assume they left a lot of money on the table.
In 2001 Microsoft rebranded WebTV as MSN TV and hastily integrated messenger and Hotmail. A few years ago, some of the functionality was adopted by Microsoft's highly successful Xbox console.
A true idea before its time, Microsoft shut down the service in August of 2013 after issuing the following statement;
"WebTV (later called MSN TV) started in 1996 with the goal to bring new people 'online' and to give those already online an easy, hassle-free means of accessing the internet from the comfort of their homes. Later, MSN TV 2 was released with vastly greater power and features. Since then, the web has continued to evolve at a breathtaking pace, and there are many new ways to access the internet. Accordingly, we have made the difficult decision to end the MSN TV service on September 30th, 2013..."
Long live WebTV.
Color quickly received $41M in its first round of funding largely based on the previous successes of its two co-founders: Nguyen, who founded Lala, an online music service that sold to Apple for $80M, and Peter Pham, the former CEO of the wildly popular BillShrink.
Color was an innovative photo sharing app that promised to leverage social and geographic data. With such a simple idea, start up news sites quickly began to poke fun at the app and criticize the large funding round that many surmised was based more on the co-founders and less on the merits of the concept.
Color launched in May 2011 and was met with lackluster fanfare. After only six months the site pivoted and relaunched as a Facebook video streaming service.
Although at one point the site garnered 400,000 monthly active users, less funded apps like Instagram hit 7M daily users.
In 2012, roughly a year after launching, stories started to emerge that Color would be shutting down. Co-founders first denied the rumors. While it is entirely possible that at that point they were still holding on, the app shut down a month later.
Apple purchased the company for a reported $7M representing a major dip from the $41M they had raised in their first round.
The fact that they raised such a large amount so quickly from some of the most intelligent VCs in the valley and that Apple acquired the core technology and team is evidence this was a good idea on some level.
Think Yelp for pharma. Full disclosure, I was on the team that helped develop the website and these are my personal opinions.
Launched in June of 2000, IndexMedical was a search engine and review site dedicated to pharmaceutical/medical device vertical.
The premise was genius. Allow people to search for medical products and view images and read reviews.
As the homepage of the website described, "Get up-to-date information on the medical devices and supplies that you need. Manufacturers and distributors list their entire product catalogs for free. Information is updated constantly, in real-time. place to find the information you need."
The brain behind this dot-com was eighty-five years old. One of the great medical minds of our time, Dr. Gottschalk, was the inventor of the Nasostat device used in emergency rooms throughout the world everyday to save countless lives.
Gottschalk's first foray into the Internet was when he purchased a home computer. He had spent decades searching antiquated paper catalogs for medical devices for his patients. Inspiration struck and he decided to build a web portal that would contain a searchable database of new medical equipment.
Our company, Passinglane, was brought in to help with the development of the site.
I would be remiss if I did not mention Steven Echtman, Jacob Zacuto, Nicolas Leqclarque, and Anthony Geoffron as being instrumental in the design and development of this project which was definitely ahead of its time.
In May 2000, after roughly two years of development, we had a swanky launch party hosted at one of the most exclusive country clubs in the Los Angeles area.
The event was covered by the Los Angels Times. I've included an excerpt including a quote from yours truly below;
"These kids at the age of five probably knew more than I do today about computers," he admits. "But I've still learned plenty from them. I trust them with my ideas. I realize I'm somewhat conservative, but I rarely put the brakes on anything. The medical profession used to be staid. But it isn't rigid anymore.
Gottschalk's free website, which he hopes will be supported by advertising, will list more than 150,000 medical products when it is unveiled online in June.
Last week, his friends and financial backers met his young design team at a reception at the Braemar Country Club in Tarzana.
Twenty-four-year-old multimedia engineer Lee Egstrom of Culver City looks so young that he was carded by the bartender when he asked for a glass of wine. While he was helping teach Gottschalk about on-screen graphics, Gottschalk was teaching him about life, Egstrom said.
"He's got that spark. I have the spark right now because I'm twenty-four. Hopefully, I'll be able to hold onto it when I'm older. I want to be a productive part of society."
Some at the reception were surprised at the age of the designers. "They look fourteen," joked Gottschalk's daughter, Vicki Turner. "This looks like an eighth-grade reunion."
As for Gottschalk, he said he hasn't ruled out hiring even younger people if he needs their help in the future. Or older people, for that matter.
"I don't discriminate if they have a good idea," he said. "Even if they're ninety."
The URL of the site now shows as being for sale.
I could continue for hours strolling down memory lane and pontificating on great or even brilliant ideas that failed for a myriad of reasons.
In tech there is an old saying, "an idea before its time is worse than a bad idea."
This is largely due to the fact that bad ideas are quickly vetted and easily avoided by intelligent founders and brilliant VCs. A good idea before its time can be a deadly trap, sucking pioneers' resources and wasting time fertilizing the ground for settlers to come in later to flourish.
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