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.

Shuddle

Safe on-demand transportation for families

General Information
Category
Transportation
Country
United States
Started
In 2014
Business Failure
Business Outcome
Shut Down
Closed
By 2016
Cause of Failure
Lack of Funds
Founders & Employees
Number of Founders
Two
Name of Founders
Nick Allen, Rodrigo Prudencio
Number of Employees
Between 11 And 50
Funding
Number of Funding Rounds
2
Total Funding Amount
$12.2M
Number of Investors
6
Description

Shuddle launched with the ambition to become the go-to service for parents with busy schedules that needed someone to drive their kids to their classes.

Shuddle drivers, which were usually moms, teachers, and nannies, were said to have been hand-selected through the extensive screening process so as to assure kids would have a safe, reliable and on time ride service.

Cause of Failure

The company offered a much-needed service but parents became increasingly disappointed with it. Online reviews of the company show that the service that claimed to be the safest and most reliable to children, would routinely leave kids stranded, cancel the booking at the last moment or make them wait for long times. Shuddle customer support was also poor and, apparently, often no one would answer or return calls. Although there were parents routinely used the app and coped with the shortcomings since there was no other similar service in the area, there was still a big chunk of parents that would try the service once and vow to never use it again for how inconvenient it was.

Adding to the service quality, there were also concerns about security since Shuddle did not subject their drivers to fingerprints background checks claiming at one point that they were too expensive for them or that they were not needed.

Their business strategy also seemed faulty. Reports state that the company lost a lot of money on several rides and that they incurred losses on every ride they made before 2016. The charged a $9 per month subscription fee plus the ever-changing fare fees, and yet was said to struggle to pay for its operational costs and employees’ salaries.

Shuddle was unable to raise funds to keep themselves afloat, no one was interested in investing or acquiring them, and they closed down in 2016.

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