Move Loot shuts down, sells customer list to Handy(techcrunch.com)
techcrunch.com
Move Loot shuts down, sells customer list to Handy
https://techcrunch.com/2016/06/29/move-loot-a-yc-backed-furniture-resale-marketplace-shuts-down-sells-customer-list-to-handy/?ncid=rss
21 comments
Or in other words a bad idea. An idea is not a good idea if your LCV is less than your CAC. Please when you see a gap in the market investigate why there is a gap. It is possible that you are a genius that can see things that no one else can, but also consider that you are walking into a death trap.
LCV = Lifetime Customer Value?
CAC = Customer Acquisition Cost?
CAC = Customer Acquisition Cost?
Yes :) These are the two key numbers you need to know to know if your business is on the track to success or failure.
That's one way of looking at it. I guess my point was more, understand your real challenge is going to be acquisition costs going in and focus on that.
With that mentality, it's likely you try to have a very low burn rate and dominate one city before expanding to another.
With that mentality, it's likely you try to have a very low burn rate and dominate one city before expanding to another.
You can tackle it either way, but keeping your costs down is certainly the smarter way to go if you are spending your own money.
The problem is investors will put pressure on you to expand as fast as possible without concern for your CAC. They don't really care if you bomb out as they are just looking for the growth rocket they can ride to the stars - if 9 out 10 blow up on the launch pad well that is just a problem for the entrepreneurs who have put their life and soul in.
The problem is investors will put pressure on you to expand as fast as possible without concern for your CAC. They don't really care if you bomb out as they are just looking for the growth rocket they can ride to the stars - if 9 out 10 blow up on the launch pad well that is just a problem for the entrepreneurs who have put their life and soul in.
Why does craigslist need to be dethroned? It's simple, works as intended, it's fast, and it's not bloated with ads. It's on top of the world for good reason.
There plenty of bigger problems to solve than a better online classifieds website.
There plenty of bigger problems to solve than a better online classifieds website.
Kijiji (a subsidiary of eBay) dethroned Craigslist in Canada a few years ago. It's more popular here, although Craigslist still exists.
How the heck did they blow through that much cash so quickly?? I wonder what the going rate is for such a list? I don't see much if any overlap between the two.
A post-mortem would be interesting. I'm guessing lack of discipline on the large raise. Since you don't have any direct competition, provie it out in 1 or 2 cities before expanding. Keep operations lean. Stay hungry.
A post-mortem would be interesting. I'm guessing lack of discipline on the large raise. Since you don't have any direct competition, provie it out in 1 or 2 cities before expanding. Keep operations lean. Stay hungry.
They didn't necessarily blow through _all_ of it. Some companies will give cash back to investors when it becomes clear that the business is not viable.
When people move and sell furniture, they often times need a cleaning to satisfy a condition of selling a home or getting their full security deposit back. Only synergy I really see and anything old is stale. Probably very cheap list.
They expanded to several cities to satisfy investors, and they were renting space to store furniture, which ended up being far more expensive than they expected. But yeah, burning through 19M in about 14 months is nuts. They were really betting it all on growing big enough to sell investors on a series B, which clearly didn't work out.
This will def be a bigger story. You know all that could've been done with that much money? We should be concerned with irresponsible investors as well, not doing their due diligence on the company's performance to avoid such a catastrophe.
I used it 2 years ago, in its early days. The selection was great and I was able to buy some great pieces at very good prices including free delivery. But after a while it was just large numbers of office furniture or ikea pieces.
Anyway, I'll probably keep what I've bought for many years. Thanks again for subsidizing me, VCs!
Anyway, I'll probably keep what I've bought for many years. Thanks again for subsidizing me, VCs!
$19mm in funding since February '15 on a 20some person company. That is an awful lot of customer acquisition cost.
Boy I could've used such a service a couple months from now. But it definitely didn't sound scalable. And apparently they expanded to the peninsula but I've never heard about them...not on HN, not on YikYak, etc...I know Palo Alto isn't the center of the universe...but it kind of is for these service startups (I'm thinking of all the food delivery startups in particular).
if you live in sf they were all around. at least their hauling trucks were. i'm guessing maybe very few people in palo alto have a need to sell their couches?
Sad news. I had a really good experience with Move Loot. It seemed too good to be true - unique and cheap furniture, delivered in the exact window I requested, already perfectly assembled. It sounds like they couldn't make it work and things declined :(
Too bad. This seemed like a great idea with a big opportunity. I used it a couple of times and I loved it. It was so much easier to get rid of furniture (and make some $$) than using Craigslist or carrying furniture to a local store.
“Over the past two years we’ve been focused on growth, operational excellence, and customer satisfaction with a primary focus on profitability,” AptDeco’s co-founder Kalam Dennis told TechCrunch. “We have spoken with Move Loot regarding their interest in an acquisition. Ultimately we’re only interested in opportunities that align with the previously mentioned strategic goals.”
Ouch. Add it to the list of on-demand services that don't scale very well.
Ouch. Add it to the list of on-demand services that don't scale very well.
All these businesses are great ideas with great solutions, the problem comes down to an unsustainable acquisition model.