You've all heard the statistic that 90% of new businesses fail within their first year for various reasons: Lack of funding, incompatible team, inadequate validation and proof, unconvincing marketing, etc. Even corporate ventures, which have a significantly higher chance of success due to the smart leveraging of corporate assets, aren’t immune to the dire possibility.
The good news is that each failure delivers an endless array of insights that can help you avoid making detrimental mistakes in the future. With that goal in mind, here’s a list of 10 corporate ventures that unfortunately didn’t make it and what you can learn from them.
Nike’s Adventure Club
Nike Adventure Club was a D2C sneaker subscription service for kids that delivered Nike or Converse shoes right to the customer’s door throughout the year. The idea was to provide parents with an easier way to keep up with their children’s rapidly changing shoe needs (e.g. due to wear & tear or changes in shoe size).
Each shoe delivery box was personalised with the child’s name and came with additional goodies like stickers, little gifts and activity guides that encouraged off-screen play. The Adventure Club even provided prepaid recycling bags twice a year to collect outgrown shoes.
Dubbed by Nike as “a parent’s best friend”, the service offered three monthly subscription options, four shoe deliveries a year for $20, six pairs a year for $30, or twelve pairs a year for $50.
Walmart’s Jet Black
Jet black was the first venture to come out of Store Nº8, Walmart’s very own corporate incubator. This concierge-style service enabled customers in the New York area to make orders from a substantial catalogue of options by text. For $50 a month, customers could text the company’s AI-powered chatbot “J” and have their orders delivered that same day.
In February 2020, after failing to find additional investors, the service was shut down. An announcement was made, letting customers know that Jet Black was no longer taking new orders and that their latest subscription fee would be refunded. As described the on Walmart corporate website:
“We’ve learned a lot through Jet black, including how customers respond to the ability of ordering by text as well as the type of items they purchase through texting. We’re eager to apply these learnings from Jet black and leverage its core capabilities within Walmart.”
BuyRely was an online payment service designed to help customers make safe down payments to purchase solar panels. The service was even recognised by the Dutch “Consumentenbond”, which mentioned the startup in their recommendations on buying solar panels.
BuyRely got its start when three ING employees (Ernst-Jan Stokvis, Martin Mastbroek and Annelies van Essen) entered the concept in ING’s 2015 internal innovation competition, ING Innovation Bootcamp. The team beat out over 1800 ideas with their promising concept.
Although some websites still mention the service as an option, the website is no longer functioning today.
Drinkfinity was a personalised beverage system that used ingredient pods to enable customers to “peel, pop and shake” drinks in reusable containers. The idea was to tap into growing consumer trends, like on-the-go consumption and the growing demand for healthier, more sustainable drink options.
Depending on their needs, customers could choose from four options: “Charge” with green coffee extract, “flow” with vitamins C & E, “renew” with electrolytes, or “chill” with calming botanicals. Each option offered a variety of flavours. Pods came in packs of four and retailed between $5 and $6, and you could purchase the Drinkfinity container for $20 at Drinkfinity.com.
The brand’s website and social media accounts are currently offline, and although the Amazon page still exists, none of the products are currently available.
Unilever’s ApotheCARE Essentials
ApotheCARE Essentials was designed to provide customers with hair and body care products that combined the best of nature and science. The brand made its debut in CVS and other select drug stores with products that retailed from $10,99 to $12,99.
In line with the company’s branding, each product came in packaging made to look like old apothecary containers and featured clean, minimal taglines like “Crafted. Customized. Complete.”.
Although some ApotheCARE Essentials products are still available through retailers like Walmart or Amazon, the company’s website currently redirects to a Unilever hair care website.
NeoCare was a tablet-based app designed to support parents with children in the neonatal intensive care unit (NICU). The app enabled parents to connect with a registered nurse or social worker known as a “NeoCoach” and get the help they needed during the NICU stay and settling back home after.
President and Founder Dr. Jeffrey Jacques helped build the app after going through a NICU experience first hand with his son in 2010.
Although the app became commercially available in 2015, the website is currently offline, and the company stage has been marked as “deadpooled” on the Tracxn website.
Ayem was launched as a quick-and-easy breakfast bowl with healthy ingredients like:
- Whey protein to build muscle mass
- Omega 3 DHA to help brain function
- Vitamin D for healthy bones
The concept came from Danone’s innovation lab, The Manifesto Innovation Accelerator or M.I.A. for short. After a very insightful year-long product launch in London, the M.I.A. team decided not to proceed with the next step for Ayem, which would have been a countrywide launch in the UK.
The RECO app was designed to help people discover, share, capture, and discuss books. The result? An online community of book-lovers focused exclusively on finding and sharing great literature.
RECO book recommendations were carefully curated and shared by a community of friends, peers, and experts, with no algorithm-driven suggestions for a more personal touch. Sadly, the app never really took off, with few subscriptions and relatively little marketing.
Loon took all the connectivity elements of a typical cell tower and put them into balloons that can be carried up to the earth’s stratosphere. The goal was to create an entire network of balloons that would provide high-speed internet access to billions of people in remote areas. The offering became known as the Loon Flight System.
Despite providing internet access during natural disasters in Puerto Rico and Peru and having its first commercial partners in Kenya, Alphabet has decided to wind down the company. Although most of the team will be moving on to other roles within X (Alphabet’s Moonshot Factory), Google and Alphabet, a small crew will remain in place to ensure that Loon’s last flight goes smoothly. As explained on their website:
“...the road to commercial viability has proven much longer and riskier than hoped. So we’ve made the difficult decision to close down Loon. In the coming months, we’ll begin winding down operations.”
VYVE was a mobile app designed to help people understand, track, and reduce their carbon footprint. It enabled users to calculate how much carbon they produced during their travels in real-time (e.g. by car, flight, bus, train etc.). The app also enabled users to buy “carbon offsets” by sponsoring different green initiatives worldwide.
VYVE was just one of the ventures to come out of Launchpad, BP’s business builder, tasked with creating five unicorn companies by 2025.
Earlier this year, the VYVE app was taken off Launchpad’s online portfolio, and the company website is currently offline.
Failure can be used productively. The trick is to keep your losses controlled and small by constantly validating various elements using lean experimentation techniques. This approach allows you to fail forward and gain the insights needed to make key decisions: iterate, pivot, or kill it.
- Store°8 plans to use many of its Jet Black learnings to improve other Walmart services like InHome.
- Loon’s team will take the skills and know-how they gained, creating their unique technology to other areas of the company, including X, Google and Alphabet.
- The Nike Adventure Club team can go on to lead new and improved D2C ventures within Nike.
Many inspiring corporate venturing success stories show how the technique can accelerate growth and create new revenue streams. Ventures like Disney+, Vipps and Hatch (to name a few) are enabling their parent companies to meet rapidly changing market trends and providing new business insights:
- Providing a broader understanding of customer pain points and preferences.
- Enabling companies to identify weak points in new business models and offerings.
- Facilitating out-of-the-box applications for new technologies.
- Acting as a springboard for the creation of future products and services.
We’ll leave you with this quote by Charles Kettering, famously known for inventing the ignition system for engines and having 189 patents: “99 percent of success is built on failure.”
Validation efforts can help businesses decrease risk, gather valuable customer feedback, and determine if a venture is commercially viable before investing too many resources. We can help you find the evidence and proof your corporate venture needs to move forward.