The pandemic has been the best thing for some startups like Edtech and also disastrous for some. One such startup that did not handle the pandemic well is the mobile-video app Quibi. The app was a streaming platform for short videos and was mainly targeted towards mobile users. After almost 6-months of its release, the American company announced that it’s shutting down because of the pandemic.
Why did the video app Quibi shut down?
The main reason that the app shut down was the idea wasn’t strong enough as accepted by the company. Quibi founder Jeffrey Katzenberg and CEO Meg Whitman did mention that the pandemic was also a crucial factor which affected their business. He also wrote to the investors and employees saying”
“We have reluctantly come to the difficult decision to wind down the business, return cash to our shareholders, and say goodbye to our colleagues with grace. We want you to know we did not give up on this idea without a fight”.
The founder and CEO also added, “The circumstances of launching during a pandemic are something we could have never imagined but other businesses have faced these unprecedented challenges and have found their way through it. We were not able to do so”.
Problems faced by the company
With so much competition in the content streaming region, Quibi couldn’t get the attention of users. Before the platform decided to shut down it even considered a sale which didn’t go well. We already talked about the fact that the pandemic was also a reason why the platform shut down, here is why.
The main idea of Video app Quibi was to be used on the go and enjoy short pieces of quality content. But, because of the pandemic, very few people are going out or commuting and therefore it doesn’t make sense for anyone to pay any subscription fees and that’s the main issue.
The platform was backed by some notable investors including Walmart, PepsiCo, and Anheuser-Busch. It raised $1.75 billion in funding before its launch in April this year. Even with so many powerful investors, they could not deliver on the promise they thought they could.
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