What a Failure

This is about the failure of my short-lived start-up: BetterFood+. 

The idea was to promote the importance of having breakfast and the concept of healthy breakfast to the group of white-collars in metropolises in China. We wanted to adopt the subscriber model and enable the users to pre-order their (hopefully healthy) breakfast for the next one week. After receiving their orders, we would prepare their breakfast by leveraging both in-house capability and outsourced suppliers and by also strategically considering the food’s shelf-life. In the last step, we would station at certain central business districts during specific timeframe to deliver pre-packaged breakfast to paid users on a daily basis. The idea was simple but the complexity of operation was way beyond our capability and imagination. Even though we started from a “minimum variable product (MVP)” and tried to test the product-market fit as much as possible, we couldn’t manage the actual monetary cost of operation during the initial testing period, the unexpected talent drain quickly after the launch, and the most lethal attack to a start-up: offering a product / service that no one wants. After a brief, one-month operation, we shut it down.

Now I think about it, I find it hard for us to succeed given our way to think, plan and operate in an industry that requires solid experience in every front of the business – strategic planning, supply chain management, branding and marketing, human resources, and other industry-specific operation areas. We were way less sophisticated and experienced than a qualified team. That doesn’t necessarily mean we were doomed to fail but we didn’t do enough reality check in the planning phase. If I were to do it again, I would run the idea by industry practitioners in the first place, borrow brains from them during brainstorming, and lay out all must-to-have experience and skill sets before we even started to think about operation details. In an industry like food and catering, experience triumphs and we didn’t have it.

I always believe that it’s 100% okay to have just a hypothesis when you start a venture. It’s how you test it that matters. And the approach we tested our hypothesis was way too expensive – we rent a kitchen, recruited a chef, procured organic raw materials directly from farms, started subsidizing users immediately after the launch, and hired a branding and marketing professional to design our brand. All of these make sense if the operation is under sufficient budget, but ours was not. If I were to do it again, I would make the operation much leaner by firstly narrowing down the scope of the MVP and secondly designing the process in a way that could be much easier to iterate (aka, more agile).

Looking back, I would say that what drove me to make such mistakes is that I was not able to operate effectively and react timely under significant resources constraints and considerable uncertainty about the viability of our proposed business model and service. I adopted part of the approach laid out in the note Hypothesis-Driven Entrepreneurship: The Lean Startup but not the rest, and I did not execute the approach in the way that was customized to my situation.

[Note: this post is the assignment submitted for the course, DPI-662 Digital Government (Fall 2018), at Harvard Kennedy School.]