Fruugo

It took me a while to get the video online; I'm currently here in the Finnish countryside, barely within the reach of the interwebz (and the trip isn't on my Dopplr, shame on me!). Converting the video from an "obscure digicamera format" into something that is reasonably sized and compliant with online video services took a while.

But here it is: Fruugo's presentation and interview from SIME08. Janne Waltonen of Fruugo gives a talk, and then sits down with Ola Ahlvarsson for a brief interview.

Fruugo talk in SIME by Taneli for http://tane.li from Taneli Tikka on Vimeo.

If you have read all the interviews available concerning Fruugo, then there isn't that much additional substance offered in this video. There are a few bits and pieces of stuff thou. This Arctic Startup post from before the appearance on stage has most of the info:

http://www.arcticstartup.com/fruugo-to-arcticstartup-on-tomorrows-pr-lau...

Janne Waltonen doesn't launch a product or service, but rather talks about the upcoming launch, without showing any previews at this point. Audience is being asked to participate and get in touch - always a good idea. In this context the "witness the Fruugo launch" -headline was a bit off, but I'm sure it is being placed there by the conference instead of the company itself. Janne does a good job in mentioning right at the start that they don't actually launch anything right now.

One of the funniest answers to "do you online shop?" - question is "I think it's boring" ;) highlights one part of the existing problem for sure.

Ola also brings one good point to the table in the interview by saying that if somebody is a retailer that's selling only in a few countries, then Fruugo sounds like a rather good prop in expanding the market to additional areas. Certainly sounds like an opportunity many might go after.

Fruugo seems very careful in trying hard not to oversell and hype, but instead bring the expectations down and keep a cool head. I have the feeling that it won't be easy for them to pull all of that through. As Janne says on stage; it takes a lot to come up and build anything new in online shopping.

The startup I'm currently heading, www.runtoshop.com, is also in the online shopping space, more specifically in the social shopping space. We don't consider Fruugo to be a "head-on primary competitor", but then again we haven't seen what they have got "under the hood" yet. Sounds like the business models and concepts have a supporting fit for each other.

Looks like we (the public) still don't know much about Fruugo, and will have to wait until January'09. Then again that's only about 45 days away, not much of a wait, or is it?

After seeing the video, what do you think? Did they give a good impression, or was something amiss? How does the story continue from here?

TechCrunch US just published a blog entry about Fruugo that refers this blog and me personally:

http://www.techcrunch.com/2008/11/05/is-stealth-startup-fruugo-stumbling...

As did ArcticStartup:

http://www.arcticstartup.com/rumors-circling-around-fruugo/

Looks like the gossip is heating around Fruugo. Interesting to see if they will just keep it cool, or possibly get engaged in the dialogue and conversations now. Some may claim that this is what they have planned all along: to be super quiet about things, and ensure more attention that way. At least they are getting attention, for better or worse? Is anybody's guess at this point.

It's a bit funny to see TechCrunch commenters refer Fruugo to Boo.com, I think that's perhaps a bit unfair. Boo.com did after all have their three famous C's: Caviar, Champagne and Concorde. It is hard to top that level of insane spending and dot-com madness ever again. Legendary!

I still think that Fruugo holds huge potential, and hope for everybody's sake that they will become a hit and a huge success case. Good luck!

One of the hot (and very secretive) new Finnish "super-startups" is Fruugo, at www.fruugo.com, an "online shopping" company with Nokia's former CEO (and current Chairman of Shell) Jorma Ollila, and F-Secure Founder/Chairman Risto Siilasmaa in the board of directors.

Fruugo has been quite secretive, signing NDA's with everyone they talk with. There has been plenty of gossip about Fruugo, which is precisely what you get if you are being secretive and don't tell ;-)

According to the gossip they have pretty impressive funding (tens of millions of EUR), and as many as 150 employees (plus possibly many 3rd party partners and subcontractors). Also according to the gossip they were hiring more people as recently as last month. The burn rate is huge for a startup: well over 1M EUR per month and climbing with all those 150 people.

ArcticStartup wrote stuff about them in late June:

http://www.arcticstartup.com/fruugos-ceo-shares-plans-with-arctic-startup/

Now the gossip has recently really heated up. Some of the stuff circulating around include:

- They are going to "tell all" at SIME Stockholm.
- Fruugo is currently mass-firing people, up to 33% of their staff (which would be 50 people?)
- Customers (merchants) are not entirely impressed with what they have to offer.
- Those who have seen the product say it's impressive and very nicely designed.
- However at the same time the gossip is hinting that "there's no beef yet"
- Their product launch has been severely delayed multiple times now.
- All the dash in hiring more people is partially a result of missing deadlines and trying to speed things up by hiring more people.

I would LOVE to see Fruugo succeed and "conquer the world". Finland (and all of Scandinavia) needs impressive "super-startup" showcases. Fruugo could be one. www.blyk.com could be one, www.spotify.com could be one. It's nasty to see people always concentrating more on the negative, than on the positive and the obvious potential.

In any case it sounds like a really serious venture: to burn up multiple millions and hire up to 150 people before the product even hits the market. Ambitious, certainly. Risky, for sure.

The 33% people laid off sounds very serious for a couple of reasons; the first one on the list being how poor management competence it demonstrates (if it is true at all?). First hiring people rapidly and then firing lots of them a month later doesn't really showcase competent management. The current economic crisis is not and could not have been a surprise to anyone in the industry. Most people have been waiting since about 2005 for things to crash "any minute now". I personally remember being in Thailand in August of 2007 on a scuba diving course (PADI; Nitrox Diver), and discussing this economic stuff with other entrepreneurs vacationing there. Some memorable lines from the conversations were that "people don't realize how serious this is, our firm has been preparing for the crash for about 1,5 years now, and we except the economy to hit the wall within a year". Didn't happen quite that fast, but almost. Not a surprise for anyone; and it should not be for Fruugo either. Managers cannot see the future, but when they have to lay off people they ARE the ones ultimately responsible.

So what's up with that? All I have is the usual gossip and rumor mill, no really concrete stuff here. Does anybody know better?