How NOT to Build a Business—Lessons from a $120 Million Mistake

How NOT to Build a Business—Lessons from a $120 Million Mistake

In today’s letter, I want to tell you about a product that aimed to change lives but ended up as a warning for businesses. It’s a great example of how good ideas can fail when execution goes wrong.

 

Whenever I want to explain why simplicity and practicality are so important in business, this is the story I share. It’s a bit funny, a bit sad, but packed with lessons for anyone getting into e-commerce.

 

Have you heard of Juicero? It was a high-tech juicing machine that promised fresh, cold-pressed juice at the push of a button.

 

Image Attribution: By Steve Jurvetson from Menlo Park, USA - Peering into the Black Box, Revisited, CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=77958337

 

I say "was" because Juicero didn’t last. Despite good intentions, the product flopped, and the reasons were obvious.

 

Juicero’s story is a classic example of how a great idea can be ruined by poor decisions. Launched in 2016, it was marketed as a revolutionary solution for home juicing—but things didn’t go as planned.

 

It had a sleek design with Wi-Fi and only worked with pre-packaged juice packs, making it seem perfect for health-conscious people. The idea was simple: insert a pack, press a button, and enjoy fresh juice—no mess, no hassle. At least that’s how it was marketed.

 

But the reality wasn’t as great. The machine debuted at $699, later dropped to $399, but still felt overpriced for what it did. On top of that, the juice packs cost $5 to $8 each, leaving customers wondering if it was really worth it.

 

Spoiler alert: it wasn’t. People quickly realized they could get the same results with a $30 manual juicer or a simple blender. And that’s where Juicero’s troubles began.

 

This leads to an important lesson for online sellers: make sure your product is worth the price. Customers are willing to pay more if they believe they’re getting real value, but according to Statista, 80% of them prioritize value over brand loyalty.

Juicero couldn’t justify its price tag, and it left people wondering why they needed an expensive machine to do what cheaper alternatives already did.

 

As if the pricing wasn’t enough, Juicero had another big issue—it was way too complicated. The machine wasn’t just a juicer; it had sensors to scan QR codes on the juice packs, applied four tons of pressure to extract juice, and required a Wi-Fi connection and a smartphone app to operate.

 

It sounded impressive, but in practice, all of these features felt unnecessary. Instead of simplifying juicing, Juicero turned it into a tech-heavy process that frustrated customers.

 

This brings us to another important lesson: keep it simple. Research from the Baymard Institute shows that 56% of customers abandon purchases when the process feels too complicated.

 

People don’t want to deal with extra steps; they want convenience. Juicero’s over-engineering turned what should have been a straightforward experience into a chore, and that complexity drove customers away.

The real blow came in 2017 when Bloomberg revealed something that made the entire product look absurd: you didn’t even need the machine. Customers could squeeze the juice packs by hand and get the same results, often faster.

 

The news went viral, and Juicero became a laughingstock. It was held up as the perfect example of Silicon Valley’s tendency to overcomplicate simple tasks. Why would anyone spend hundreds of dollars on a gadget when their hands worked just as well?

 

This teaches another valuable lesson: your product needs to solve a real problem. Customers don’t care about fancy features if they don’t address something meaningful.

 

A survey by PWC found that 86% of buyers are willing to pay more for a better experience, but it has to feel relevant. Juicero failed because it tried to fix a problem that didn’t exist. People already had easy, affordable ways to make juice, so there was no need for a high-tech solution.

 

Juicero’s downfall didn’t stop there. The company made another critical mistake by forcing customers into its ecosystem.

You couldn’t use your own fruits and vegetables with the machine; you had to buy Juicero’s proprietary juice packs. This lack of flexibility alienated customers who wanted more control over what they consumed.

 

Today’s consumers value choice and freedom, and Juicero’s rigid system was a deal-breaker. Research from McKinsey shows that 73% of customers stick with brands that offer personalization.

 

If you make people feel trapped—whether it’s through subscriptions or limited options—they’ll go elsewhere. Juicero’s approach made customers feel boxed in, which only added to its problems.

 

By the time word spread about these issues, Juicero’s reputation was in shambles. Despite raising over $120 million in venture capital, the company shut down in September 2017.

 

They even offered refunds, which was a nice gesture but couldn’t save their business. Juicero collapsed because it failed to deliver real value or connect with its audience.

 

Whether you're launching your own product, private labeling, or reselling, listening to your customers is essential. According to research by Qualtrics, businesses that prioritize customer feedback achieve 60% higher profits.

 

If Juicero had paid attention to early criticism—about its price, complexity, and lack of flexibility—it might have survived. Always test your product with real users, gather feedback, and use that information to improve.

 

Juicero’s story is a reminder that innovation alone isn’t enough. It has to serve the customer. Simplicity, value, and real solutions are what drive success.

 

Most importantly, never forget to listen to your audience. When you put your customers at the heart of your business, you’re far less likely to become the next cautionary tale.

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