The failure of “Lively Inc.” is making entrants into this market segment nervous, so let’s consider. Over the past week remaining physical assets of the Silicon Valley Firm Lively or mylively.com, were acquired by another business. As this was a well-funded startup, lets reflect on what might have happened and what can startups & current ventures learn from this?
Well, as it stands not too much – Lively was not a typical example of the industry it entered. Founded in late 2012, launching in the spring of 2013 and quickly sank, going out of business just last week. At the outset, it appeared to have all the components of great potential. Founded by the successful Iggy Fanlo (AdBrite, Shopping.com) and others, seeded with $2.8 million from Maveron LLC and another $4.8 million from Cambia Health.
The experienced board of Lively included Laura Carstensen, professor at Stanford’s Longevity research so much advice was available and Lively was in the Aging 2.0 GENerator portfolio. Its design was attractive in a market segment not known for beautiful products and the initial offering included a LivelyGram, a family-written attractive print mailing sent to the elderly user.
But multiple mistakes were made and others should learn. So given all the factors –high profile founder, board members, VC funding, nice design, great PR – why did it fail?
- Initial direct-to-consumer marketing approach was wrong. For sensor-based monitoring and PERS, the channel sales approach has been the only viable approach. By 2013, the sensor-based home monitoring market had never seen any direct-to-consumer success despite millions of investment in previous attempts by Wellcore & QuietCare.
- The founders had no background in the senior care market space. This seems to be a recurring Silicon Valley cliché: we liked your last company and we like you, so regardless of the market category, we will fund you because you’re one of us. So, experience in the home care sector not required for your funding.
- Institute for the Ages study was inadequate. A much heralded but tiny (29 units) in-market pilot with consumers was held with support of the now-defunct Institute for the Ages in Sarasota in April, 20163. What was learned about utility of the product and whether the majority of the devices worked as designed? Whatever the outcomes, Lively plowed on – raising another$4.8 million and launching 5 months after the pilot in September, 2013.
- Did the founders see problems with their hardware? In Iggy Fanlo’s own comments, “Hardware is HARD. Our friends at Apple have raised the consumer expectations bar so high that it’s difficult to achieve that goal at startup scale. The cliché is true: the journey IS the reward.” Mr. Fanlo was well-trained in Silicon Valley startup-babble.
Read Article (Laurie Orlov | ageinplacetech.com | 12/06/2015)
Is it possible that a simple poll, asking consumers if the wanted these products could have averted failure?
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