Beepi failure

Beepi

P2P used car online marketplace

Description

Beepi was an online peer-to-peer marketplace for used cars. Beepi promised to make the transaction easy, safe and profitable for all parties. The company would take care of inspecting, processing and eventually delivering the cars to the customers themselves. Vroom, a similar business to Beepi, requires only photos before cars are listed, while Beepi sent an inspector for on the spot inspection. Great customer service was one of Beepi’s strengths.

Stats

Category
Transportation
Country
United States
Started
In 2013
Closed
By 2016
Number of Founders
Two
Name of Founders
Ale Resnik, Owen Savir
Number of Employees
Between 101 And 250
Number of Funding Rounds
6
Total Funding Amount
$149M
Number of Investors
31
Precise Cause of Failure
Mismanagement of Funds
Business Outcome
Acquired

Cause of Failure

It went out of cash to operate and tried to sell itself to two potential buyers, but the potential sales were not successful and Beepi had to close operation.

The company had an incredibly high burn rate, spending about $7 million per month. The reasons for cash shortage were attributed mismanagement of funds to support expenditures unrelated to business such as covering the bills for the founders' partners and spendings unnecessary sums of money on expensive furnitures. At the same time, Beepi was also reported as giving disproportionately high salary and overtimes to its top management.

Besides having failed to manage the financial aspects of the startup, also Beepi’s logistics in buying and selling cars came short. Originally planning to complete an acquisition deal with Fair.com, one of its main competitors, that never happened and the company tried to negotiate with DGDG, but also this deal fell through. The company shut down in December 2016.

Go on Reading

Other Startups

LuckyUnicorn t-Shirts
We've just launched 20 limited edition Failory t-shirts. Click here to buy one!

Startup Cemetery

A big resource for entrepreneurs and startup owners, in which we have collected and analyzed why +100 big companies have failed. Learn from mistakes, and avoid being part of the 90% of businesses that fail.

Beepi

P2P used car online marketplace

General Information
Category
Transportation
Country
United States
Started
In 2013
Business Failure
Business Outcome
Acquired
Closed
By 2016
Cause of Failure
Mismanagement of Funds
Founders & Employees
Number of Founders
Two
Name of Founders
Ale Resnik, Owen Savir
Number of Employees
Between 101 And 250
Funding
Number of Funding Rounds
6
Total Funding Amount
$149M
Number of Investors
31
Description

Beepi was an online peer-to-peer marketplace for used cars. Beepi promised to make the transaction easy, safe and profitable for all parties. The company would take care of inspecting, processing and eventually delivering the cars to the customers themselves. Vroom, a similar business to Beepi, requires only photos before cars are listed, while Beepi sent an inspector for on the spot inspection. Great customer service was one of Beepi’s strengths.

Cause of Failure

It went out of cash to operate and tried to sell itself to two potential buyers, but the potential sales were not successful and Beepi had to close operation.

The company had an incredibly high burn rate, spending about $7 million per month. The reasons for cash shortage were attributed mismanagement of funds to support expenditures unrelated to business such as covering the bills for the founders' partners and spendings unnecessary sums of money on expensive furnitures. At the same time, Beepi was also reported as giving disproportionately high salary and overtimes to its top management.

Besides having failed to manage the financial aspects of the startup, also Beepi’s logistics in buying and selling cars came short. Originally planning to complete an acquisition deal with Fair.com, one of its main competitors, that never happened and the company tried to negotiate with DGDG, but also this deal fell through. The company shut down in December 2016.

Go on Reading

Wantful

Online gift-giving service

e-Commerce
Shut Down
$5.5M
Competition
e-Commerce
United States
In 2011
By 2013
One
More Than 10000
Between 1M 10M
Competition
Shut Down
Karhoo

Cab aggregator and price comparison tool

Transportation
Acquired
$39M
Poor Product
Transportation
United Kingdom
In 2014
By 2016
One
Between 51 And 100
Between 10M 50M
Poor Product
Acquired
Crowdmix

Music streaming and sharing platform

Music
Acquired
£14M
Mismanagement of Funds
Music
United Kingdom
In 2013
By 2016
Two
Between 101 And 250
Between 10M 50M
Mismanagement of Funds
Acquired
Maple

High-quality food delivery startup

Food and Beverage
Acquired
$29M
Bad Business Model
Food and Beverage
United States
In 2014
By 2017
Two
Between 101 And 250
Between 10M 50M
Bad Business Model
Acquired
OpTier

Cloud-based enterprise software business

Analytics
Shut Down
$118.1M
Bad Market Fit
Analytics
United States
In 2002
By 2014
Two
Between 51 And 100
More Than 50M
Bad Market Fit
Shut Down
HotelsAroundYou

Booking of same-day hotel rooms

Travel
Shut Down
$125.4K
Competition
Travel
India
In 2013
By 2017
Three
Between 1 And 10
Less Than 1M
Competition
Shut Down