Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Why can a scam company raise $40 Million Series C + $76 Million Series B?

news.ycombinator.com

Post reply on HN
Print view View original

271–280 of 480 posts

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#271

Post by mvembu »

jdh wrote: post #23

I'm the Series A investor in this company. We in fact have done plenty of due diligence, and you will be pleased to know it is not a scam company. In fact, the company has very high customer satisfaction ratings, including an NPS that is in the ballpark of Amazon, and a very high customer retention rate. More than half of the people who subscribe to the service are still subscribers after two years, which is unusuall…

Mr. VC, great explanation. You blame it on the purchaser for the poor usability & cheap business manipulation. Customer buys a shoe, you added a VIP membership by default & you wanted customer to remove that before checkout.

Why can't you just have a intermediate page saying "Save 50% by subscribing to VIP membership at $39 / month" with all the explanation & have "Yes, subscribe me as a VIP member" & "No Thanks" instead of adding that by default ? JustFab won't do that because they know conversion will be much lower.

In every site I have purchased, I have never seen this experience. So how do you want me as a user to SUSPECT a monthly recurring charge like this ?

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#272

Post by belorn »

downandout wrote: post #178
halviti wrote: post #163

Earlier quoted context omitted.

Except for there is a time window for these sorts of things. His girlfriend isn't going to be able to dispute charges that are 8-months old.

The window is usually 180 days, and some of the more lenient credit card companies will go back even further depending on the circumstances. She can easily get back 6 of the 8 monthly charges. A simple way to avoid issues like this is to always generate a virtual card for each purchase, and then turn the virtual card off the moment the transaction is completed. You can do this through Netspend prepaid cards - you jus…

My bank provides a virtual card service, and I use it for basically everything. I would be hesitant to make purchasing from smaller or new online stores without it.

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#273

Post by danielweber »

jdh wrote: post #42
karterk wrote: post #29

Earlier quoted context omitted.

Not the OP - but I did take a look at that page, and I do find it misleading. The "checkout as a regular member" is in a small font on the sidebar, while the main CTA is big, bold and defaults to the VIP program. The part where you're told about the monthly fee is in the last sentence of the sidebar. I had to practically hunt it to find it - for most people shopping online this will be oblivious. By giving the screen…

I don't accept the word "misleading" -- I do not believe the page in any way misleads. It does not try to position it as anything other than a subscription, and the language is plain english. Could they put the subscription details in bold? Could they use a larger font than all the other text? Sure. It's a tradeoff, for sure, and every retailer has to optimize their site to perform. Could they pop up three boxes afte…

People, please don't downvote this guy so much that his comments disappear.

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#274

Post by ds_ »

skelsey wrote: post #201
ds_ wrote: post #152

Amazon do basically the same thing with their prime membership, although they do refund if you notice and complain early enough (offer a free month and then start charging unless you opt out, whilst making it far from obvious that you have to do so).

Prime is a membership. It even has it in the name! How is that the same level of misleading?

It was offered with a purchase as a way of getting free shipping. It was not at all clear to me that I would have to opt out rather than my membership just being cancelled unless I paid a fee. It felt deliberately misleading and it seemed many shared my surprise when I went looking for complaints afterwards.

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#275

Post by ds_ »

vvvVVVvvv wrote: post #213
ds_ wrote: post #152

Amazon do basically the same thing with their prime membership, although they do refund if you notice and complain early enough (offer a free month and then start charging unless you opt out, whilst making it far from obvious that you have to do so).

The other difference worth noticing is that albeit being a bit unclear, Amazon's Prime is far to be as shady as JustFab's darkpattern since there's a huge modal window popping during the order.

Perhaps I shouldn't have said 'basically the same thing'. They both deliberately mislead users into subscribing, Amazon is just more subtle.

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#276

Post by haimez »

ghshephard wrote: post #228
abalone wrote: post #154

Every single person who has been misled into signing up for a recurring charge should do this one thing: Dispute the charge with their credit card company. You'll get your money back and it will issue a bunch of chargebacks to JustFab, which will penalize them financially. If enough people complain their penalties will escalate and their credit card processing rates will go through the roof. This is how the credit ca…

Totally not the case that you get your money back, at least with WellsFargo Visa, they will investigate to determine whether your card was used by some other party. Saying, "I didn't read the terms of the agreement" is not grounds for a chargeback. What's worse is when you've signed up for a One year recurring payment and you have to jump through hoops to cancel such as a registered letter to cancel. Wells fargo will…

That's why you should use a credit card and not a debit card for online purchases. If you dispute the charge, it's their money instead of yours that they're recovering.

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#278

Post by cs702 »

JustFab is not a 'scam company' (in the sense that they may not be doing anything technically illegal), but they are using DARK DESIGN PATTERNS[1] to trick at least some people into doing things they don't want to do.

The checkout page[2], in particular, seems designed specifically to trick people into signing up for recurring monthly charges. Any person who adds merchandise to the cart and then clicks the big 'Continue Checkout' button -- without stopping to read all the surrounding text -- will unintentionally sign up for the $39.95/month "VIP" plan.

My mom, who is trusting by nature, would never stop to read all that surrounding text, because she has been conditioned by years of online ordering to add items to a cart and then find and click the big checkout button. She would be tricked into signing up for recurring charges.

--

[1] See http://darkpatterns.org/

[2] http://imagesup.net/?di=15138026329215 -- this was posted by one of the company's investors elsewhere on this thread. It's a canonical example of a dark design pattern.

Re: Why can a scam company raise $40 Million Series C + $76 Million Series B?

#280

Post by kriro »

jdh wrote: post #23

I'm the Series A investor in this company. We in fact have done plenty of due diligence, and you will be pleased to know it is not a scam company. In fact, the company has very high customer satisfaction ratings, including an NPS that is in the ballpark of Amazon, and a very high customer retention rate. More than half of the people who subscribe to the service are still subscribers after two years, which is unusuall…

It seems that you invested in a scam. Hopefully they will be out of business soon.
Post reply on HN