It’s hard to name a category of startups that has struggled to produce big, billion-dollar exits more than e-commerce. Competing with Amazon AMZN 2.54% isn’t easy, it turns out, and aspiring Davids have turned to ever more novel strategies to differentiate themselves from Goliath. The problem? Like anything trendy, each new twist on the e-commerce model eventually goes out of style.
Perhaps you remember the great subscription commerce wave of 2012—as I called it, stuff-in-a-box. It was a clever way to score recurring revenue by sending subscribers a container of curated stuff they didn’t even know they wanted. It didn’t take long for each new stuff-in-a-box startup to feel increasingly ridiculous: subscription perfumes, dog toys, cured meats, even stilettos hawked by Kim Kardashian. Investors quickly realized the model was little more than a 21st-century twist on the Jam of the Month club, and the subsequent shakeout, marked by mergers, shutdowns, and pivots, happened quietly.
After subscription commerce came “content and commerce,” a trend that peaked so fast it’s more of a blip than a full-fledged fad. The idea—tacking an editorial operation onto a store—failed to increase profits for most startups, and last year the leader of the pack, Thrillist, split its e-commerce and media businesses. Founder Ben Lerer conceded to technology website Recode that it was “not the most productive” for the two to share resources.