After spending much of the last month in Silicon Valley, I can report: There is still a lot of stupid out there.
Sure, you’ve got your start-up success stories — your Squares, your Paths, your Birchboxes. But the Valley is also rank with stale and superfluous companies that are either doing the same thing as lots of other, better companies, or doing something nobody wants at all. And some of those companies are getting millions of dollars from venture capitalists for their ill-conceived ideas.
One prominent Valley figure described the change to me thusly: “It used to be that you needed a full business plan to get VC money. Then you needed a slick PowerPoint. Now, all you need is a movie pitch: ‘It’s Groupon Meets Zynga!’”
Some of the companies born as X-meets-Y derivations may succeed. But many will not, and it’s our job to be willing to tell their investors and would-be investors, as VP candidate Paul Ryan put it this week, the hard truths.
So to add to our last installment, here are three more Dumb Money contenders:
Nudge ($300,000 seed round from friends and family)
Nudge bills itself as “workplace healthstyle software.” Basically, you tell the Nudge app everything about your daily health routines — what you eat, how much you walk, how tired you feel — and it spits out points and badges and virtual trophies and other things that are supposed to motivate you to lay off the freaking Cheetos.
This alone is a hard goal. In order to get the kind of user base it envisions, Nudge is going to have to function as a sort of ultra-Foursquare, in which users not only log every place they go, but every frozen yogurt they eat, every dog they walk, every cigarette they smoke, every time they feel a little nap coming on. And they’re going to have to pay (Nudge currently charges $2 a month) for their encouragement.
As Ryan McCarthy pointed out recently, “gamification” — the trend of turning boring and mundane processes into fun-seeming games — is the hottest idea in business management right now. But it’s old news by Silicon Valley standards. Even Foursquare, which practically invented gamification-by-app, is moving away from the model, observing that its users were becoming less enticed by badges and hungrier for real-life rewards.
Wantworthy ($1 million from RRE, Google Ventures, and others)
Wantworthy, which bills itself as the “Instapaper of Shopping,” is one of the many companies trying to make a buck by making your shopping experience more pleasant and webby. The site provides “an online shopping tool for tracking everything you want to buy in one place.”
Haven’t we seen this before? After all, as TechCrunch notes, “on the surface the company might appear to be competitive with Pinterest, various bookmarking tools, or even Amazon’s Universal Wish List utility.” And every week, a new site pops up (like Lyst) that claims to improve the shopping process in some vague, inchoate way. There’s even a list of Pinterest clones, featuring gems like DartItUp (a Pinterest for dudes) and Snatchly (a Pinterest for porn).
Wantworthy’s founders told TechCrunch it was “too soon for them to talk user numbers,” which, yeah, red flag. But even if they did somehow get as many users as Pinterest, there’s no indication that the basic “social shopping” model actually generates real revenue. Just this week, the director of Zappos Labs told Bloomberg that Pinterest is worse than Facebook and Twitter when it comes to converting clicks into actual purchases. That’s a bad sign for Pinterest, but it’s even worse for its copycats.
Clipix (undisclosed funding amount from founder and “other angel investors from the New York area”)
Clipix is a “visual bookmarking tool” that TechCrunch described as “a hybrid between Evernote and Pinterest, with a bit of Pearltrees thrown in for good measure.” So, yet another Pinterest clone, but this time “for the real world,” whatever that means.
To differentiate itself, Clipix recently launched a QR code generator that it hopes will be used by “companies that want to distribute promotional materials at trade shows or real estate agents who want to share real estate information.”
QR codes, for those unfamiliar, are those little black-and-white patterny things that people are supposed to scan with their phones, but that nobody ever actually uses. A ComScore survey last year found that only 14 million people (or 6 percent of all American mobile-device users) have ever scanned a QR code, and many in the tech sphere are calling for the codes to be killed altogether.
So, to recap, Clipix is betting that real estate agents will create QR codes for their properties, then give those codes to their clients, who will have no earthly idea what to do with them.
Luckily, a minor bug like that may not matter to Clipix. Oded Berkowitz, the company’s founder, recently told TechCrunch that “the company isn’t focused too much on developing a revenue stream.”