One of the most lavishly funded gadget startups in Silicon Valley last year was Juicero Inc. It makes a juice machine. The product was an unlikely pick for top technology investors, but they were drawn to the idea of an internet-connected device that transforms single-serving packets of chopped fruits and vegetables into a refreshing and healthy beverage.
Doug Evans, the company’s founder, would compare himself with Steve Jobs in his pursuit of juicing perfection. He declared that his juice press wields four tons of force—“enough to lift two Teslas,” he said. Google’s venture capital arm and other backers poured about $120 million into the startup. Juicero sells the machine for $400, plus the cost of individual juice packs delivered weekly. Tech blogs have dubbed it a “Keurig for juice.”
But after the product hit the market, some investors were surprised to discover a much cheaper alternative: You can squeeze the Juicero bags with your bare hands. Two backers said the final device was bulkier than what was originally pitched and that they were puzzled to find that customers could achieve similar results without it. Bloomberg performed its own press test, pitting a Juicero machine against a reporter’s grip. The experiment found that squeezing the bag yields nearly the same amount of juice just as quickly—and in some cases, faster—than using the device.
Juicero declined to comment. A person close to the company said Juicero is aware the packs can be squeezed by hand but that most people would prefer to use the machine because the process is more consistent and less messy. The device also reads a QR code printed on the back of each produce pack and checks the source against an online database to ensure the contents haven’t expired or been recalled, the person said. The expiration date is also printed on the pack.
Evans, 50, follows a diet of mostly raw, vegan foods. Technology was a new thing for him, but he picked it up quickly. He said he spent about three years building a dozen prototypes before devising Juicero’s patent-pending press. In an interview with technology website Recode, he likened his work to the invention of a mainstream personal computer by Apple’s Jobs. “There are 400 custom parts in here,” Evans told Recode. “There’s a scanner; there’s a microprocessor; there’s a wireless chip, wireless antenna.”
In fundraising meetings, Evans promised a revolutionary machine capable of squeezing large chunks of fruits and vegetables, said two people who agreed to invest in the company. Evans secured funding in 2014 by showing 3D-printed renderings of the product without a working prototype, said the people, who asked not to be identified because they signed nondisclosure agreements.
Kleiner Perkins Caufield & Byers joined Alphabet Inc. and others in funding Juicero. Evans’s subscription model had hit on a sweet spot for venture capitalists, said Brian Frank, who invests in food-tech companies through his FTW Ventures fund. The successes of Nespresso and Dollar Shave Club have made VCs eager to chase such deals, he said. “Investors are very intrigued by businesses that combine the one-time sale of hardware that ends up leading to repeat purchases of consumable packages,” said Frank, who doesn’t own Juicero shares.
I want to take a moment to think about the techies who invested in a $400 Capri Sun machine.
Edit: it apparently used to be $700. I regret the error. ---