TinyOwl

» see tinyowl.co.in as it lived, on the wayback machine

~ the obituary ~

On 3 November 2015 a 24-year-old cofounder flew to Pune to close his company's office there and tell the staff they were being let go. He did not leave the building for two days. The people he had just laid off stood between him and the door and said he could go once they had their money, and the police came in and out of the premises while this was happening without any of it stopping. He got out on 5 November after some of the settlements were agreed.

TinyOwl was founded in 2014 by five graduates of IIT Bombay and did the thing every Indian consumer startup did in that window, which was raise money against growth and worry about the unit economics afterward. Sequoia and Matrix put in the bulk of roughly twenty-seven million dollars. The app let you order from restaurants near you, which is a service worth having, and it charged nothing like enough to cover picking the food up and driving it to your door.

The layoffs came in two rounds. Around a hundred and sixty people went in September 2015. Another 112 sales staff went on 3 November across four cities, and the difference that mattered was that the September group had not been paid out yet while the November group was being handed post-dated cheques. That is the arithmetic that produced the Pune office, and reading the coverage now, it is hard to argue the employees had it wrong.

Nothing like this happened in Turkey, and the reason is that the Turkish version of this question got answered fourteen years earlier. Yemeksepeti launched in Istanbul in 2001, spent the next decade as the only place anyone ordered from, and sold to Delivery Hero in May 2015 for 589 million dollars, the largest internet exit the country had seen. It is still taking orders. India got four hundred restaurant delivery startups funded inside three years and Turkey got one that got there first, and the difference is not that anyone was smarter. One market had its answer before the money arrived.

~ the case file ~

~ what the money bought ~

Offices, mostly, and people to sit in them. The post-mortems all land on the same list: headcount far beyond what the order volume justified, offices leased at a size that assumed the growth curve was real, and a cost per delivery that never came down because there is no software fix for a person on a motorbike. Customer acquisition was bought with discounts, which meant the orders arriving were from people who would leave the moment the discount did.

The strategic problem underneath was worse. TinyOwl was a marketplace sitting between restaurants and customers, so the restaurants owned the food and the delivery fleets owned the logistics, and the app in the middle owned an interface. When four hundred companies are offering the same interface, the only thing you can compete on is price, and every rupee of that comes out of the funding.

~ two days in pune ~

The detail that keeps this story from being a normal shutdown is that the staff were not wrong about the risk. A laid-off employee holding a post-dated cheque from a company visibly running out of runway is holding a piece of paper, not money. Refusing to let the person who signed it walk out of the building is not a rational strategy, but it is a legible response to being handed one.

Most startup deaths are quiet because the people involved have somewhere else to go. This one was loud because a sales hire in Pune making a modest salary does not have three months of savings and a network of recruiters. The founders were 24 and had raised twenty-seven million dollars from the best-known funds in the country, and the gap between those two facts is the whole event.

The end itself was ordinary by comparison. Users started seeing a notice in the app in mid-May 2016 saying service would stop after 22 May everywhere except Mumbai, and that is the date on this page. The remains merged into RoadRunnr, a logistics startup carrying a similar amount of funding, and the combined company relaunched as Runnr that June. Zomato bought Runnr in September 2017, so the assets ended up inside the incumbent TinyOwl had been funded to take on.

tinyowl.co.in no longer resolves and tinyowl.com is a parked page that bounces you to a lander, which is what a dead startup usually looks like from outside. Neither is what this one is remembered for.

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