Stockwell, the AI-vending machine startup formerly known as Bodega, is shutting down July 1 – TipsClear

Stockwell AI entered the world with a bang, but it is leaving with a whisper. Founded in 2017 by ex-Goglers, the AI ​​vending machine startup, formerly known as Bodega, first raised blood pressure – people hated how it referred and poorly disrupted ‘mom-and-pop shops’ I had a swoop – and then raised a lot of money. But ultimately, it was no match for COVID-19 and is a hit in how we live.

TipsClear has learned and confirmed Stockwell The shutdown will take place later this month, as it was unable to find a viable business for its in-building app-controlled “smart” vending machines, which were stocked with convenience store items.

Co-founder and CEO Paul McDonald wrote in an email to TipsClear, “Regretfully the current scenario has created a situation in which we can no longer continue our operations and will close the company on July 1st.” “We are grateful to our talented team, incredible colleagues and investors, and our amazing shoppers who made it possible. While this was not the way we wanted to end this journey, we believe our approach to bringing the store to places where people live, work and play is through other amazing companies, products and services Will live from “

We basically reached out after we were molested by someone receiving an email about the closure. Stockwell’s vending boxes were distributed mainly in apartments and office buildings, and it had been contacting customers for the past week who broke the news.

For what it’s worth, the building operator who uses Stockwell vending machines said it is actively looking for a replacement provider, so it appears to have had some use, but more clearly it is for the vending machine industry Very difficult, where some distributors have seen trade losses of up to 90%.

Stockwell’s closure is notable because it underscores that in the current climate, funds with a strong list of backers and a very decent amount of money cannot always guarantee insulation for everyone.

As of last September, Stockwell had raised at least $ 45 million in funding from investors, including NEA, GV, DCM Ventures, Forerunner, First Round and Homebrew. Its network had grown to 1,000 “stores”, smart vending machines that function like advanced hotel minibars: sensors detect and charge what you remove, and track what you buy. Both for and on payments use smartphone apps. .

As of last autumn, the company appeared to be gearing up for a widening of its business model, giving its customers (building, office and apartment managers) a big say in what Stockwell did beyond the items they put in their machines Stocked up, which included some basics like water and other drinks, savory and sweet snacks and laundry detergents and painkillers.

By December, it seems that McDonald’s co-founder, Ashwath Rajan, had quietly left the startup, and then COVID-19 took its toll as soon as 2020 came into gear.

First, consumers spent more time working themselves and went out of home to shop for less and in bulk to reduce shopping efforts. This, in turn, had a large impact on the stability of the business model based on casual, small purchases, such as typically occur from vending machines such as Stockwell.

Second, at a time when many people are trying to reduce the spread of infection by wearing face masks, washing their hands and touching random objects, a big question mark hangs over the whole concept of unlicensed vending machines. , And can they ever be cleaned properly. This impacted not only the people purchasing the items, but the workforce that helps stock and maintain these kiosks.

There have been some interesting twists as to how the vending industry has handled COVID-19. Some are swapping pretzels and snickers and replacing them with PPE equipment, and others are getting the opportunity to stock them with healthy food, especially for front-line workers who have no other choice And requires quick but nutritional improvement during critical times.

But in general, the vending machine industry has been hit hard by the epidemic.

The broader market is estimated at some $ 30 billion dollars a year in a typical year – one reason that Stockwell ni Bodega likely caught the eye of investors – but for many major operators the business has fallen off a cliff.

The president of the European Vending Association, in an appeal to government leaders for financial support, said in April that trade had fallen by 90% and described COVID-19 as a “devastating effect” on the sector. Tough numbers for Pepsi and Mondelez (nee Kraft) of the world, but certainly a nail in the coffin for a young, promising AI-based vending machine startup that nevertheless has some skepticism from the word go.

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