Shyp, which was one of the major disruptor in package shipping space (Uber of courier) is shutting down.
The company raised $63mn (including $50mn from KPCB) and even had legendary John Doerr on their board.
Shyp is the first to make it effortless and friction-free to ship your goods, in a way that’s almost magical [John Doer]
What really happened?
From a focus point of view, the company was stuck between B2B and B2C play and by the time it realised its mojo, they ran out of money.
Lesson #1: Product Market Fit is a bitch.
The only way to look at PMF is MPF, i.e. Market-Product Fit and like most of the startups, Shyp too looked at it from (my) product – (will figure out) market – (someday) fit.
the investment we took, everything we got, wasn’t warranted for where the business was at. And I think that really hurt us. The expectations were way too high. We had a lot of capital. We had to deploy it. And I don’t think we were ready to do that. We prematurely scaled.” [Gibbon, CEO Shyp / source]
Excessive funding drives insane decisions and we have seen enough of those in India as well. But that’s not really a mistake (hey! that is good salesmanship) – let’s come to the next point.
Lesson #2: Funding is NOT and I repeat, NOT and I repeat again, NEVER a sign of PMF or even if it is, you need to understand this:
Product Market Fit is always a moving target.
It’s not a nirvana state where you get in and you remain there.
Like a lion in the jungle, you still need to hunt for your next meal, the next big business model.
The biggest mistake most startups commit is believing in this equation:
If Funding = PMF;
Then Excessive Funding = Excessive PMF
Most startups die not due to hunger, but indigestion and while the ecosystem celebrates funding and awards, you as a founder need to celebrate customer wins.
How many Indian startups do you think still haven’t achieved their PMF and are receiving awards and funding $$?