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Dishero What went wrong case

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24 Questions

What was the primary service offered by Dishero?

Photographing food

How much funding did Dishero raise?

$2.8 million

What was the outcome of Dishero's business operations?

It ceased operations

What was the benefit of using Dishero's services for restaurants?

It sped up their lines

What was the role of the VP of Sales hired by Dishero?

To acquire new customers

What was unique about Dishero's food photography?

It was very good

How many people did Dishero have on its team at its peak?

17 people

What was the benefit of using Dishero's photos for restaurants like Spreadz Deli & Café?

It allowed staff to recommend items

What was the main problem with Dishero's growth?

Revenue growth was painfully slow and unpredictable.

Why did Dishero's cofounder, Alex Fishman, say selling to restaurants is hard?

Restaurant owners are busy, run low margin businesses, and experience high employee turnover.

What was the purpose of Dishero's food photography for Dragon Rouge restaurant?

To display dishes on video monitors throughout the restaurant.

What was the monthly revenue of Dishero when it closed?

$9,000

Why did Dishero's cofounder say the company was in the worst possible place?

Because it was in a state of uncertainty, neither failing nor succeeding.

What was the main challenge Dishero faced in terms of marketing strategies?

Restaurant owners have been prospected many times by start-ups.

What was the purpose of Dishero's services for restaurants?

To showcase dishes on video monitors throughout the restaurant.

What was the outcome of Dishero's startup?

It failed to grow and eventually shut down.

What was the primary challenge faced by Dishero in acquiring customers?

It was hard to get the attention of restaurant managers and owners.

What was the outcome of employing a sales force by Dishero?

A high cost of customer acquisition.

What was Option D, which was not seriously considered by Dishero's cofounders?

Pivoting outside the restaurant industry.

What was the amount of money left in Dishero's bank account when it was closed?

$1.8 million

What did the investors tell Dishero's cofounders to do with the remaining funds?

Keep the funds and use them for a new venture.

What is the name of the company started by two of Dishero's cofounders after it closed?

Bugsee

What is Bugsee's primary focus?

Creating tools for app developers.

What can entrepreneurial firms learn from Dishero's experience?

The importance of understanding the dynamics of growing a firm.

Study Notes

Dishero's Service

  • Dishero provided a service where they photographed food for restaurants to display on video monitors, which encouraged customers to order dishes they hadn't tried before.
  • The service was used by restaurants like Spreadz Deli & Café, where they showed high-quality photos of menu items on video monitors, allowing staff to recommend items and speeding up lines.

Challenges Faced by Dishero

  • Selling to restaurants was hard due to busy owners, low margin businesses, and high employee turnover.
  • Restaurant owners were often prospected by start-ups with promises that didn't deliver, leading to skepticism.
  • Dishero faced a high cost of customer acquisition due to employing a sales force to approach restaurant owners.

Dishero's History

  • Dishero was started in 2013 by Alex Fishman, Ilya Ginzburg, and Dmitry Fink.
  • The company raised $2.8 million in funding and had a strong engineering and business team.
  • Dishero had revenue and happy customers from the start, but ultimately ceased operations in 2016.

Reasons for Shut Down

  • Dishero's revenue growth was painfully slow and unpredictable.
  • The company's expenses were $100,000 a month, while revenue was only $9,000 a month.
  • The cofounders made the difficult decision to shut down the company, citing mediocre success and uncertainty about what to do.

Lessons Learned

  • Entrepreneurial firms can learn about the challenges of growing a company from Dishero's experience.
  • It's essential to consider the dynamics of growing a firm and to have a clear understanding of the market and revenue potential before launching a company.

Dishero provides digital menu systems for restaurants, showcasing dishes on video monitors to create conversation and increase sales. Restaurants like Dragon Rouge in Alameda, CA, have benefited from this service.

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