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The on-demand apocalypse? Well, knowing Techcrunch they're probably overreacting, but this is a prediction I can get behind. Maybe now VCs can invest in companies that don't rely on questionable labor tactics in order to deceive themselves and others into thinking that they're unicorns.
The company had actually reached contribution margin positive — it was selling meals for more than it cost to cook them. But due to other costs and the frosty fundraising climate, wasn’t able to get the money it needed to continue operating. Am I reading this correctly, and the business metric this company managed to achieve is simply "selling food above cost", like every deli and diner in the country does? Or is the…
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Ignoring the app, and disruptive gimmick, I have to wonder what your average diner could have achieved with $13.5m in funding. You could build a small, well branded chain. Probably selling food above cost to boot! :)
Food service has a terrifying reputation as a business sector—restaurants routinely go out of business in their first year. Deep funding would create a buffer and help it grow, of course, but I still wouldn't want to bet on a restaurant.
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Why not? Deals can easily fall through in early stages. "Last minute" basically means the details were pretty much hammered out, everybody was just about ready to sign, then something happened to scuttle it.
I think he was suggesting that when something falls apart it's always at the last minute for that something. Kind of like how you always find something in the last place you look. I guess it's kind of accurate since you wouldn't describe an early stage deal as having "fell through".
Sad to see any startup die, but this was not unexpected. I know I am but a tiny sample of the overall SF food market, but I'm squarely in the target demographic (work at home, don't like to go out to eat). I used SpoonRocket a few times, but entirely gave up on them after trying a few times. I love Sprig and order from the often. Here's why: * SpoonRocket's meals simply weren't healthy. A lot of the folks in this spa…
Ironically UberEATS launched officially today.
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Are you suggesting that my read was incorrect, and that they are cash flow positive after not just food costs but logistics as well?
From wikipedia: >> Contribution margin, or dollar contribution per unit, is the selling price per unit minus the variable cost per unit. “Contribution” represents the portion of sales revenue that is not consumed by variable costs and so contributes to the coverage of fixed costs. So, positive contribution margin should imply they covered all the fixed and variable costs, the way I read it. But then, why do they need…
That's not what the passage you included says. It says it only covers variable costs.
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From wikipedia: >> Contribution margin, or dollar contribution per unit, is the selling price per unit minus the variable cost per unit. “Contribution” represents the portion of sales revenue that is not consumed by variable costs and so contributes to the coverage of fixed costs. So, positive contribution margin should imply they covered all the fixed and variable costs, the way I read it. But then, why do they need…
"So, positive contribution margin should imply they covered all the fixed and variable costs, the way I read it." That's not what the passage you included says. It says it only covers variable costs.
So, the passage explains what contribution margin is, but TC is talking about being "contribution margin positive". How would you understand the second term?
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I don't agree that their food was "largely gross and very unhealthy" - mac & cheese was just one of the options, they always had 2-3 other nicer options I was a user since 2013 and enjoyed their stuff, too bad it's gone wonder if sprig's gonna survive..
Ya like meatloaf, ribs, burritos, etc. Everything was 700 calories+++
obviously, not for everyone, yah, 700 calories can add up