How The Quibi Crumbled

Quibi raised $1.8 billion and failed within 6 months.

Yes, you read it right; $1.8billion.

While reading about the multiple reasons why Quibi failed, two statements made by the co-founder stood out to me…

“We are not competing against Netflix”

“We are differentiated from social networks.”

When building a new product, it is important to note that who you think your competitors are is not as important as who your potential customers think your competitors are.

Many people have said that Quibi wasn’t solving a real problem, I tend to disagree with that perspective, and here’s why:

➡️ The people I saw as their competitors were successful [TikTok, YouTube, etc.]. If your competitors are successful, they must be solving a problem. It’s that simple.

The question is:

Do you know who your real competitors are and are you solving the customer’s problem better than them?

This is how the cookie (Quibi) crumbled.

According to CB Insights, 20% of startups fail because they get outcompeted while 8% fail because of a poor product.

The challenge with Quibi started when they couldn’t recognize who they were truly competing against.

This got worse when they built a subpar product that completely ignored the existing alternatives (competitors) that their customers were already used to.

The refusal to admit the error and pivot eventually cost them.