Timing = WIN. Demand Destruction = FAIL. But what if they are one and the same?
If ever there was a casualty of Covid – this start up was it, but the learnings were significant.
When I shared the subscribers of Three Strikes Theory back in July, it was clear that there were numerous Founders who are part of this community.
I get a lot of feedback from may people, but the people who tend to share their stories with me are Founders.. like the Co-Founder of Buddee.
Buddee Fitness was an on-demand marketplace that connected people with fitness professionals, aiming to address the difficulties both parties face.
People often struggle to find suitable trainers, while fitness professionals find it challenging to maintain a financially sustainable career.
Buddee Fitness provided a solution by offering a platform where clients can book personalised training sessions with various fitness professionals (e.g., yoga, pilates, boxing) based on their training type, time, location, and budget.
For fitness professionals, the platform simplified the business side by handling scheduling, payments, and client management, thereby creating a more financially secure and sustainable business.
With a focus on superior user experience and scalable technology, Buddee Fitness sought to disrupt the fitness industry and become a leading connector in the market - a marketplace between fitness professionals and their clients.
The platform worked, I used it myself to find, schedule and pay a personal trainer - it was great!
Things were looking up in 2018 the MVP was built and functional, people like me were using it.. proof points were being demonstrated, and stats were looking good.
Unfortunately, things did not go to plan from there.
Timing & Demand Destruction
The Three Strikes that took Buddee down?
Yes, Buddee had Technology challenges - trying to match a resource constrained team to a grand vision.
Yes, Buddee had Capital challenges - 100 investor meetings, with very limited results.
Yes, Buddee had Commercial challenges - a major hotel in the US was primed to be the springboard they so desperately needed.. Buddee has solved for the hotel’s liability issue around recommending fitness professionals for guests in-room gym areas (an innovation I would like to see in more gyms). Using Buddee the liability was passed from the hotel to there guest who use Buddee to select and book their own trainer.
But, as I wrote previously around the key reasons startups success vs the reasons they fail, Buddee had a confluence of the single biggest reasons startups succeed - timing - with the single biggest reason they fail - no market need.
Covid19 was bad timing, and completely destroyed the market need.
CORE INSIGHT
In speaking with the Founder, she shared this amazing insight with me:
Marketplaces that are instant and impersonal ie “I need an Uber now” support a per transaction fee business model.
vs
Marketplaces that are protracted and personal ie “I want a massage at some point this week, but want the right masseuse” should be on a monthly subscription fee, potentially for both the buyer and the seller.
So Buddee started with the wrong business model.. because Buddee was a marketplace that connected Buyers (people who wanted to train, in general at some point) with Sellers (personal trainers, who had to be a personal match)
Wisdom
The Founder told me that if she would re-start the business she would start with a monthly fee for personal trainers to list on the platform, a monthly fee for users to participate (until they found a trainer, then they could end their subscription) and not deal with any of the more sophisticated features and functionality that could be built… only extending into complexity like scheduling features, billing management, and safety features if and when the demand was there from existing trainers and users.
I am impressed with the insights she shared with me, I am proud of her for starting her business, I feel for her having shared in similar failure (just with many more $$$ invested and lost involved).
I copy a n excerpt of her final shareholders update below:
I leave you with a quote she included to shareholders, which resonates with me and I believe will resonate with anyone who has dared to start their own business venture.
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better.
The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again...
Who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly.”
- Theodore Roosevelt
If you’re interested, please have a look over previous articles of startup failures and the reasons why:
> Three Strikes for a startup
> Three Strikes for a multi-billion dollar listed company
> Three Strikes for a mobile ticketing & payments startup in 2005
> The single reason startups win, and the many reasons they don’t
Do you have a story to share with me?
"no market need" is a definite killer. So many good companies that was ahead of their time. Or on the opposite spectrum failed to keep up with the changing times.