Chowdy: Shutting Down a +$110,000/Month Food Startup

https://www.failory.com/interview/chowdy

by nicoserdeir • 8 years ago

37 30 8 years ago

wycs3• 8 years ago

These people built a business that provided a lot of value and a bunch of bureaucrats killed it because they didn’t like the thought of something being in a fridge for less than 48 hours.

This is the message of these regulations: don’t try to do anything in the real world. Solve only ephemeral, virtual problems.

This guy is working on a travel information app now. He has gotten the message.

kencausey• 8 years ago

I hear you but it sounds like the concern was that no one onsite with the refrigerators could be considered responsible for monitoring for possible tampering with the food.

vezycash• 8 years ago

That's what tamper proof seals are for aren't they?

Cameras in fridge + CCTV could also have worked.

Fridge/unattended issue is a solved one. Japan has vending machines for food.

I think their biggest mistake was turning down the dragon funding. They would have avoided most issues especially the one that led to their shutdown.

With food vending machines, better pricing, and new location deals, this might work out. E.g. A vending machine in an office building.

I bet they would do well in silicon valley or any other location with high startup density.

digitaltrees• 8 years ago

So anyone should be allowed to open a business and experiment with possibly dangerous practices, some of which we know injured or killed people in the past, because then more people would want to start businesses? Seems like the exact pattern we want to discourage.

I bet these founders opened this business as a corporation rather than in their individual capacities — meaning they were shield personally from the liability and consequences of their actions. Limited liability is a privilege extended to encourage risk taking, but it comes with a set of responsibilities to limit risky behavior to within norms we have, as a society, learned are beyond what we are willing to tolerate let alone encourage; these limits or responsibilities are called regulations.

By all means question the necessity of the specific regulation; their efficacy in avoiding the harm of food poisoning, but do so with fact based scientific methods. Don’t merely throw out any regulation unless you want to go back to a state of nature where anything goes.

decker• 8 years ago

Our pricing was way too low. So low that we basically made no profit over the 2 and half years we ran Chowdy. So low that we didn’t have any resources in reserve to help us deal with unexpected emergencies.

Yeah, absolutely nothing about the business model had anything to do with it going under...

imperio59• 8 years ago

When I lived in New Caledonia growing up, we had a similar service which used reusable food "boxes" that would get delivered to your front door or to your work every lunch. It would be left on your door step and it was up to you to grab it quickly and refrigerate it. This was in a tropical country. No one ever got sick. Seems like regulatory overkill, especially in a place where half the year the outside temperature is colder than most fridges.

(Link in French for those curious, it's called "la gamelle" and it's still going strong today, albeit with throwaway plastic containers.http://lafamilletortue.com/gamelle-nouvelle-caledonie/ )

beerbajay• 8 years ago

we learned that it’s illegal to use home kitchen for commercially sold food

aka "we didn't do any research at all"

we were inspired by Uber and Airbnb to just ignore the regulators.

Those pesky food safety regulations. These guys were extremely negligent and should be glad they got out before anybody got sick.

wycs3• 8 years ago

Yes. Keeping food in a fridge for 48 hours. What a crime.

deleted_account2• 8 years ago

Take a look at one of their hubs: https://imgur.com/a/PQJB09X. Maybe around 300+ meals stuffed in there? Back-of-the-enveloping the amount of time people are opening and closing those doors, I'm a little dubious they're staying at refrigerator temperature the whole time. I'm not surprised someone looked at this and thought, "That's an e. coli outbreak waiting to happen."

swaggyBoatswain4• 8 years ago

There's a lot of food safety issues they ignored though

- 3rd party hubs means you get a wide range of manufacturers for refrigerated. Not all are rated equally. Sometimes the compressor goes bad, or insulation gaskets need to be replaced

- Food rotation. Because there is no staff at each location, there's a higher chance that you'll find meals 1+ weeks old. Its up to the consumer to see the date stamped

- If you rotate food often, unit will not be up to temperature (34-38*F) generally.

- If you don't have a designated employee at site to move food into refrigerator, it might spoil before it gets there. This deals with logistics

- Using 3rd party has a huge oversight in potentially tampering with food + legal implications.

- Inspections / legal is complicated

natmaka2• 8 years ago

"The average lifetime of a subscriber was 9 weeks, with almost half quitting after the first week.". I wonder if someone tried to find their reasons to do so. He also notes that "consumers have no loyalty to food brands; they will happily try a bunch and switch to another service if they can get a better deal.", but knowing which criteria they use may be vital(?) The "lower price" can't be their sole criterion when it comes to food they consume.

yhoneycomb• 8 years ago

The "lower price" can't be their sole criterion when it comes to food they consume.

Yeah, their analysis of the situation seems very shallow

If people are only concerned about price they can just go to McDonald's

beatgammit• 8 years ago

Or buy a bunch of frozen crap from the store.

I'm quite loyal with prepared food, not loyal with ingredients.

bdcravens• 8 years ago

Having tried multiple food services, I've frequently tried because of an intro price, discovered the quality was meh, and immediately quit after the first week.

natmaka2• 8 years ago

Many test this way. Chowdy's food quality may have been not as high as expected by (most/a too high fraction) of their customers.

talltimtom• 8 years ago

My experiance with food companies is that this is just a way for the company to excuse their own shitty practices which drive customers off. Of cause I’m going to be “loyal” if price quality and reliability are all on point. But almost every food related service I’ve tried have a great pitch but suck on at least two of those three points. If people where dumping them after just one week they had mayor issues that where not related to regulations.

ckdarby• 8 years ago

I'm wondering if they would have been able to convince the food regulators if the fridges themselves had sensors and such.

Concept would be to create an audit trail of the fridge itself from the sensors.

Shorel• 8 years ago

I think this would work extremely well in most developing countries.

In fact, I have read about some system in India or Japan where a lot of people get home make food, distributed in stacked containers.

mohi13• 8 years ago

"with almost half quitting after the first week"...to me this sounds super critical...no amount of funding or a partnership with even god him/herself, can't make it work unless this is fixed.

pcurve• 8 years ago

Yeah he didn’t really talk about food and menu. 6 to 7 dollar per meal isn’t anything to scoff at. It’d better be tasty on consistent basis.

Chowdy: Shutting Down a +$110,000/Month Food Startup

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