back to article Non-unicorn $700 e-scooter shop Unicorn folds with no refunds – after blowing all its cash on online ads

In a savage blow to the notion of nominative determinism, e-scooter startup Unicorn is shutting down after blowing all its money on Facebook ads. Unicorn was the brainchild of Tile co-founder Nick Evans, who wanted to capitalise on the scooter trend that’s presently rippling across the US and Europe. Although it’s possible to …

  1. chivo243 Silver badge
    Facepalm

    Fools and their money

    yeah! invest in a luxury electric scooter start-up!

    But, maybe, I'm wrong? Maybe this ingenious device is really a way to shape the gene pool? Remove the rich stupid ones?

  2. streaky

    Ahahaha

    "A large portion of the revenue went toward paying for Facebook ads to bring traffic to the site"

    Perfect.

    Who wants to take a wild guess if they even did that..

    People who work in marketing are morons - a good product sells itself, every single time.

    1. Throatwarbler Mangrove Silver badge
      FAIL

      Re: Ahahaha

      "a good product sells itself, every single time."

      Well, no. I think we would all like to believe that, but the marketplace is filled with inferior products that succeeded due to superior sales and marketing.

      Sent from Windows 10 (and not, for example, BeOS).

      1. AntiSol

        Re: Ahahaha

        "a good product sells itself, every single time."

        "the marketplace is filled with inferior products that succeeded due to superior sales and marketing."

        These two statements aren't mutually exclusive. Just because you can sell crap with a marketing campaign doesn't mean that a good product doesn't sell itself. Your "Well, no" is not justified.

        Sent from Linux, a good product, and not, say, windows 10, which has a large marketing budget.

        1. The Man Who Fell To Earth
          Alert

          Re: Ahahaha

          I use/manage Linux,Windows 7 &10, and Macs pretty much every day. Doesn't matter how "great" the non-Windows OS may be, I don't envision ever not using Windows simply because of the vast amount of software we've invested that's made for it. So IMO, there's a third component to market success and that's the product's stickiness (the cost of changing).

          1. Michael Wojcik Silver badge

            Re: Ahahaha

            There are cost/benefit ratios for tangible direct costs, tangible indirect costs (e.g. cost of maintenance, cognitive load, opportunity costs), and a wide array of intangible costs, most of which are psychological factors which are often disconnected from, even opposed to, material benefit.

            And purchasers rarely manage to acknowledge even a significant fraction of those costs, much less take them into account.

            That's why we have behavioral economics. Some economists finally admitted that people are not rational economic actors.

      2. Anonymous Coward
        Anonymous Coward

        Re: Ahahaha

        Well, no. I think we would all like to believe that, but the marketplace is filled with inferior products that succeeded due to superior sales and marketing.

        Sent from Windows 10 (and not, for example, BeOS).

        "We are not inferior products!", said Windows 10 users. (ref)

    2. mevets

      Re: Ahahaha

      " a good product sells itself .." I worked for two companies that seemed to have good products that believed that BS ( Sun Micro, QNX Software). Both floundered into dust before being sucked up into vacuums. I worked for one fruit vendor that knew that with good sales and marketing you can even sell a book about your sales and marketing.

      AGPSI has to be about the stupidest traps that any engineering company can fall into; and so many do because they are dumb enough to believe everybody is just like them. At one point QNX was penning an advert (I hope it never came to life) with a tagline about QNX being the OS for people who knew how to program their VCR. Can you imagine? From that moment on, all my e-devices flashed 12:00 unless they could figure it out themselves. Sadly, the fruit vendor was the one that figured that out. sigh.

      1. eldakka Silver badge

        Re: Ahahaha

        I think there's a difference between not marketing well products you do have (Sun) vs trying to market products you don't actually have (Unicorn)...

    3. Claverhouse Silver badge

      Re: Ahahaha

      It does. Advertising Must Die.

      1. defiler Silver badge

        Re: Ahahaha

        Sadly, if one company has marketing then every company must have marketing. Because if Company A says "Company A is brilliant and Company B steals your blood" and Company B says nothing to refute that then Company A is right (in the public perception).

        It's stupid and annoying but it's the way things work. People are surprisingly easily herded.

        1. Imhotep

          Re: Ahahaha

          Similar to if there is one lawyer in town, he'll starve. If there are two, they'll both be rich.

  3. vtcodger Silver badge

    I had to look it up

    "Nominative determinism is the hypothesis that people tend to gravitate towards areas of work that fit their names." Wikipedia

    1. Anonymous Coward
      Anonymous Coward

      Re: I had to look it up

      Trump / Johnson .... I begin to see a pattern

    2. sbt Silver badge
      Thumb Up

      Unicorns never existed. Seems to fit perfectly.

      Segues into: "Get orf my footpath, hipster!"

      1. Steve K Silver badge
        Coat

        Re: Unicorns never existed. Seems to fit perfectly.

        Segways, surely...?

        1. sbt Silver badge
          Facepalm

          "Segue/segway": It's not a joke if you have to explain it...

          ... but that was the joke.

          Anyway, how did you know my name was Shirley? Have you been in my NHS records?

    3. Anonymous Coward
      Anonymous Coward

      Re: I had to look it up

      .. but was the article referring to "Unicorn" or "Nick" ?

      1. Michael Wojcik Silver badge

        Re: I had to look it up

        "My name is Nick. My father thought of it while shaving."

  4. Imhotep

    Odd Excuse

    "And as the weather continued to get colder throughout the US"

    They didn't see that coming? I have it on good authority the weather will soon start getting warmer once again. Some people even claim to be able to predict these changes with some degree of accuracy.

    1. Foxglove

      Re: Odd Excuse

      'They didn't see that coming? I have it on good authority the weather will soon start getting warmer once again. Some people even claim to be able to predict these changes with some degree of accuracy.'

      Maybe they could foresee the nuclear winter the Orange Shitgibbon might inflict on the world?

      1. TDog

        Re: Odd Excuse

        Well that will be jolly useful, no need for Greta and we could sort of solve a few other problems at the same time. (P.S. Should anyone find the plans for the real BMD (and it is apparently available here

        https://www.amazon.co.uk/s?k=ballistic+missile+defense&hvadid=79920783529168&hvbmt=be&hvdev=c&hvqmt=e&tag=mh0a9-21&ref=pd_sl_3wo1k4a0b_e)

        if you can find the right one, that would also be useful.

        When I recollect the past, the other star of "Bedtime for Bonzo" might have made a good president, compared to the current incumbent. That is, if you didn't object to him not having a tail.

      2. The Nazz Silver badge

        Re: Odd Excuse

        Hey Foxy

        Look on the bright side, at least Orange isn't White.

      3. This post has been deleted by its author

    2. Imhotep

      Re: Odd Excuse

      BTW: This was just a reference to the changing seasons.

    3. Michael Wojcik Silver badge

      Re: Odd Excuse

      "Also our testers kept reporting some sort of slippery substance on the sidewalks, which made the scooters hard to control."

      1. Imhotep

        Re: Odd Excuse

        Tech Support, July 4: Case closed. Unable to replicate conditions.

  5. mevets

    Here is a story.

    Hey Cheech (Harold), do you think people would like a lo-rider scooter.

    Yeah man (kumar), we could make them wicked cool.

    Lets get some money and rock this thing.

    ....

    Hey Chong (kumar), do we know how to make those scooters?

    No man, we smoked all the cash. I don't think we can make them.

    Yeah man, uh, lets move on.

  6. Claverhouse Silver badge

    the Lexus of two-wheelers,

    They should have ignored Facebook, and maybe advertising entirely, since Good Wine Needs No Bush, and just concentrated on the City and Wall Street plus Park Lane and whatever equivalent rich district New York has, using 'influencers' and gossip to inculcate the idea that the truly successful and the rich beyond belief desire no object so much as an exclusive top-of-the-range scooter to advertise their wealth.

    .

    BTW a number of recent start-ups here have been headed for 'partial refunds': not in the economic class that spends freely, but don't people ever resent giving over a wodge of money, and in return receiving a small percentage back along with a letter of apology ?

    1. I ain't Spartacus Gold badge

      You can only do your marketing through "influencers" if you have an actual product.

      If there's no product, then there's nothing for them to pretend to ride in their Youtube videos. Unless you've got sufficient cash to fake things, like Magic Leap.

      So when you're needing their pre-order cash in order to make the thing - then you're stuck with marketing.

    2. Michael Wojcik Silver badge

      Yes, that strategy worked so well for the Segway. Hell, Steve RDF Jobs couldn't influence that thing into a success.

      1. I ain't Spartacus Gold badge

        A £3,000 price tag didn't help! You can have a good second hand car for that - or a crap one and lots of petrol. Or a nice bike. Or 200 bottles of gin...

        1. zuckzuckgo

          Or half a dozen scooters.

          1. I ain't Spartacus Gold badge

            I keep coming back to the gin though... Maybe sub in some decent scotch for some of it.

  7. W.S.Gosset Silver badge

    Nominative determinism...

    ... can be maintained by simply deleting the "R" from their name.

  8. Mike 137 Bronze badge

    The only winner in this

    Guess who - Facebook.

    The ad broker behemoths seem to be taking over the entire commercial world, but there's an elephant down the corridor. Once everyone's an ad broker, what will they sell, as there'll be nothing to advertise.

    1. Blank Reg

      Re: The only winner in this

      I don't even notice online ads anymore, haven't for many years. I just mentally block them out and have never clicked on one except by accident. If everyone was like me then the business model for most of the web would collapse.

      1. sketharaman

        Re: The only winner in this

        Online ads is growing at double digit rates. Proof that everyone is not like you.

    2. Doctor Syntax Silver badge

      Re: The only winner in this

      Like I keep saying, the only thing the advertising industry sells is advertising.

  9. Aristotles slow and dimwitted horse Silver badge

    Nick Statt’s reputation?

    To be honest I'd never heard of him. But then again I'm not really into all of this vacuous hipster "let's stick IOT into everything whether it needs it or not" crap.

  10. Warm Braw Silver badge

    Unicorn was in an entirely different business

    The word "business" seems to have been progressively redefined and now seemingly describes the process of throwing someone else's money into a wishing well.

    1. I ain't Spartacus Gold badge

      Re: Unicorn was in an entirely different business

      Although I don't approve of this as a business model, you have to agree that the best kind of money to spend is somebody else's money...

    2. Imhotep

      Re: Unicorn was in an entirely different business

      That definition works equally well for government.

      Perhaps that is now the whole field of human endeavor?

  11. Andy The Hat Silver badge

    This smells of fish ...

    Income is from pre-orders and grants. Expenditure is down payment for manufacture and advertising.

    "Competition from others made it more and more difficult to sell scooters." Never saw that one in the business plan ...

    This is a classic take the money and run ... the bosses have had their cash so who gives a monkeys about the punters.

    Now, anyone fancy investing in a Speccy clone I'm developing?

  12. Valeyard

    priorities..

    TLDR: "we had all these orders to fulfill but we spent all the money trying to get more orders instead, so we ended up with even more orders but no money to make them with"

    1. I ain't Spartacus Gold badge

      Re: priorities..

      I don't know how he took the money, but this is a classic error on Kickstarter. You need to set your cash target at 20% more than you need to make the products, so you can cover unexpected problems. And also so you're not scrabbling around trying to raise extra cash halfway through the process.

      Whereas a lot of people set their target deliberately low, to guarantee they'll get funded and then hope that the extra they can make from stretch goals will take them over the line of the actual cash they need. Plus of course the hope that the success of reaching the funding goal will generate buzz and more orders - that "this project funded in 2 hours" marketing bullshit that's so common on these kind of projects.

      That's assuming the fundraisers are honest of course. They're the ones who then desperately try to make the thing for the next year with only 2/3rds of the budget they need - and almost have a nervous breakdown doing it.

      Then there's the ones who get the money and then worry about what to do next - while making sure they spend a good portion of it while they're doing this thinking. The types who claim to have a fully working prototype that just needs production funds - but then spend a year on "product development" and never actually get round to actual manufacturing.

      Kickstarter and in particular Inidiegogo don't seem to mind too much which types they get.

      1. Doctor Syntax Silver badge

        Re: priorities..

        Unless you have product development completed and paid for down to the last detail 20% is going to fall well short. Even then if you want to get income from it it's still well short.

        1. I ain't Spartacus Gold badge

          Re: priorities..

          If the produce isn't developed - you shouldn't be doing a kickstarter. I believe it might even be against their Ts and Cs.

          1. Michael Wojcik Silver badge

            Re: priorities..

            Lettuce hope so. That might pear down the number of hopeless cases. I expect we'd all appreciate seeing Kickstarter raisin the bar.

            Orange you glad I stopped there?

            1. I ain't Spartacus Gold badge
              Happy

              Re: priorities..

              Michael Wojcik,

              I feel a proper lemon now, after that typo. Happle-y, I think my point was still clear - despite my full-fat sausage fishfingers.

              I am grapeful that you stopped there - as I think we had a marrow escape.

      2. baud Bronze badge

        Re: priorities..

        I've also seen Kickstarter being used to show the interest in a project before looking for investors, like the game Kingdom Come, which raised ~1 M$ on Kickstarter, out of a ~30 M$ budget.

        1. DropBear Silver badge

          Re: priorities..

          That's pretty much all it is these days, lots and lots (and lots and lots) of project owners never even consider making what they want to make on the funds raised, which would be a small fraction of a realistic budget anyway - they just want the metrics to throw at people with actual money to prove existing interest. That is of course not at all how they're selling it to the punters on KS, and frankly I find this business model incredibly disgusting...

  13. Anonymous Coward
    Anonymous Coward

    A couple remarks

    1. USD150,000.- is a pittance for a business of any significance. Am I to understand that they had at least an order of magnitude more cash than that from other sources?

    2. Facebook is a TERRIBLE place for advertising, according to personal experience of two sources close to me. One source reports that after a low-volume advertising trial their visibility dropped far below pre-advertising levels shortly after they stopped paying. Neither of the two sources I know made any conversions from Facebook advertising, so it was literally burning money to them.

    3. Saying that as the year went on it kept getting colder is either the pathetiquest™ excuse north of the Equator I've heard so far this week, or legendarily poor planning.

    4. Advertising a product that does not (yet) exist is a controversial but not uncommon technique to gauge market interest. But doing so with customers' money sounds way too close to fraud for a sensible person to even consider it.

  14. Pascal Monett Silver badge

    smartphone-enabled locking

    Of all the stupid things to include, that takes the cake alongside integrated GPS.

    Just put a cradle on the handlebar to hold the phone the user already has that has GPS in it already. Add wireless charging to it since you're selling to the hipsters.

    As far as locking, a nice, solid, physical lock is the only solution.

  15. teebie

    That press release sure uses a lot of words when "we are incompetent" would have done.

    Unless Nick and Nick are helping to mitigate the blow against nominative determinism?

  16. Anonymous Coward
    Anonymous Coward

    Making things ... is hard. Selling things ... is hard. If you outsource both, what value are you adding?

    The best place for a maker startup is a site where people pledge money. That will gauge interest, set your budget and help determine whether the cost of manufacturing is viable. Advertising is for later when you scale up.

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