4 ms·

As an exercise; let's say you're called into Fruugo this morning and put in charge (they make an offer you can't refuse). You can raise money thanks to the con

As an exercise; let's say you're called into Fruugo this morning and put in charge (they make an offer you can't refuse). You can raise money thanks to the connections of the board, if you need it. You're given the brief that you can do whatever you need to save the company. What would you do? (Shutting it down and selling off the parts for scrap not being an option).

hef19898 15y ago
Try to get the product offerings straight, eject all contries I don't currently need, repair the homepage, check my legal obligations regarding negative equity. After all, the market they are in doesn't seam to ba a bad one, and high-level connections almost never hurt (maybe here they do, who knows...). But without the right products and what you could sum up as good user experience it won't work. I'm just not sure if it's possible to make enough money to offset almost 40 mio in losses...
swombat 15y ago
My quick answer? Reduce the team to the minimum needed to explore new business models, raise enough runway to keep that team going for 18 months, restructure the cap table to incentivise this core team, and treat it like any other startup. Perhaps change the name too to avoid continuity and too much press attention early on. Of course, no one is ever given this much latitude. Existing shareholders would argue that diluting them down to almost nothing (90+% dilution) does not mean "saving the company" (they're wrong, IMHO. Shareholders and "the company" are two distinct entities). The amount of politics involved in pulling this off would be such a distraction that even if it succeeded, it would probably destroy the company's chances - and this is even before you consider the hangover from millions of euros of debts!). So, in short, the only sensible way for people in that company is to shut it down and start another with a clean bill of health, and chalk this one up to experience.
- exDM69 15y ago
  > My quick answer? Reduce the team to the minimum needed to explore new business models, raise enough runway to keep that team going for 18 months, restructure the cap table to incentivise this core team, and treat it like any other startup. I think they already did this. Three times.
  - swombat 15y ago
    Doubt it. You couldn't burn €40m doing that for 20 years.
    - loverobots 15y ago
      They have stores, albeit online ones, for some 20 countries. Just checking the laws in each country must have cost them a pretty penny
      - swombat 15y ago
        Yeah, having "stores for every country" is almost exactly the opposite of what I'd call "exploring business models with a minimal team". So, in short, that is not what they've been doing.
wpietri 15y ago
First, find out if anybody has a problem that actually needs solving. It sounds like they had a plausible hypothesis, that cross-border commerce is a pain for both vendors and consumers. But either the problem isn't a big one or fruugo doesn't actually solve it. If the hypothesis is still solid, then I'd start iterating on both the vendor and consumer side to find something that does solve their problems. If the hypothesis is false, it's worth looking to see what assets there are to see if there's another hypothesis within range. But at this point the brightest staff are probably gone, they don't seem to have much in the way of vendor relationships, the platform sounds shoddy and anyway has a lot of assumptions baked in. So if there are no real assets, then I'd put it out of its misery, but encourage the staff to pitch current investors to get seed money for follow-on startups.

hef19898 15y ago

Try to get the product offerings straight, eject all contries I don't currently need, repair the homepage, check my legal obligations regarding negative equity. After all, the market they are in doesn't seam to ba a bad one, and high-level connections almost never hurt (maybe here they do, who knows...). But without the right products and what you could sum up as good user experience it won't work. I'm just not sure if it's possible to make enough money to offset almost 40 mio in losses...

swombat 15y ago

My quick answer? Reduce the team to the minimum needed to explore new business models, raise enough runway to keep that team going for 18 months, restructure the cap table to incentivise this core team, and treat it like any other startup. Perhaps change the name too to avoid continuity and too much press attention early on. Of course, no one is ever given this much latitude. Existing shareholders would argue that diluting them down to almost nothing (90+% dilution) does not mean "saving the company" (they're wrong, IMHO. Shareholders and "the company" are two distinct entities). The amount of politics involved in pulling this off would be such a distraction that even if it succeeded, it would probably destroy the company's chances - and this is even before you consider the hangover from millions of euros of debts!). So, in short, the only sensible way for people in that company is to shut it down and start another with a clean bill of health, and chalk this one up to experience.

exDM69 15y ago
> My quick answer? Reduce the team to the minimum needed to explore new business models, raise enough runway to keep that team going for 18 months, restructure the cap table to incentivise this core team, and treat it like any other startup. I think they already did this. Three times.
- swombat 15y ago
  Doubt it. You couldn't burn €40m doing that for 20 years.
  - loverobots 15y ago
    They have stores, albeit online ones, for some 20 countries. Just checking the laws in each country must have cost them a pretty penny
    - swombat 15y ago
      Yeah, having "stores for every country" is almost exactly the opposite of what I'd call "exploring business models with a minimal team". So, in short, that is not what they've been doing.

wpietri 15y ago

First, find out if anybody has a problem that actually needs solving. It sounds like they had a plausible hypothesis, that cross-border commerce is a pain for both vendors and consumers. But either the problem isn't a big one or fruugo doesn't actually solve it. If the hypothesis is still solid, then I'd start iterating on both the vendor and consumer side to find something that does solve their problems. If the hypothesis is false, it's worth looking to see what assets there are to see if there's another hypothesis within range. But at this point the brightest staff are probably gone, they don't seem to have much in the way of vendor relationships, the platform sounds shoddy and anyway has a lot of assumptions baked in. So if there are no real assets, then I'd put it out of its misery, but encourage the staff to pitch current investors to get seed money for follow-on startups.