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The Spoon

Daily news and analysis about the food tech revolution

Doug Evans

Juicero To Lay Off 25% of Staff As It Accelerates Plans For Gen-2 Juicer

Juicero, the high-profile connected juicer startup founded by cold-press juice pioneer Doug Evans, is laying off 25% percent of its staff in an attempt to lower costs as it accelerates the development of a second generation juicer.

According to a report in Fortune, Juicero CEO Jeff Dunn sent a letter to employees which said the company is planning to lay off a quarter of the staff as part of a plan to lower costs as it transitions away from a premium pricing strategy.

“The current prices of $399 for the Press and $5 – $7 for produce Packs are not a realistic way for us to fulfill our mission at the scale to which we aspire,” wrote Dunn.

Much of these struggles come in the wake of a Bloomberg article in April that showed how the company’s juice packs can be squeezed by hand without the company’s $400 juicers. The article and accompanying video resulted in dozens of similar blog posts all asking essentially the same question: How on earth could a company raise $120+ million to build a $400 juicer when all you need is your hands?

As I wrote back in April, Juicero brought much of the crisis on themselves. Not only did their premium pricing strategy for the juice press and pods rub many the wrong way, the company also brought out the snark with talk of their product as a “platform”.  With popular shows like HBO’s Silicon Valley mocking the excesses and faux gravitas of today’s tech entrepreneurs, more and more people are quick to question why every gadget has to be viewed as more than just a gadget.

However, I also felt the Bloomberg article didn’t paint a full picture of the company. While the post’s authors pointed out the folly of investing $120 million in a juicer that could be replaced with one’s hands, they never discussed how the company spent much of that initial investment to create an entire juice pack factory and delivery supply chain system. The article also failed to mention that while pretty much any form of automated kitchen task performed today such as blending, cutting or squeezing can be done without a machine at a lower price, people have shown they are willing to pay for convenience in the form of task automation. It’s this very idea of paying for convenience that is the foundational principle behind pretty much any store that sells tools, whether it’s the corner hardware store or a Williams-Sonoma.

Nitpicks of the Bloomberg article aside, the reality is the company needs to lower pricing to reach a bigger audience. As I wrote in January when the company dropped the price to $399, while they are still in a unique position as the only company making a pod-based cold-press juicer, they needed to drop pricing to reach significant growth.  The company’s next-generation juicer, expected to be priced around $200, could stimulate significant demand, particularly if the company could just figure out how to lower the price of its juice packs to three bucks or even lower.

Long-term, the company has an even bigger challenge: figuring out how to scale its juice pack production. With only one production plant currently (located in Los Angeles), they will eventually need to figure out how to get packs to customers around the company quickly. The answer is likely more production facilities which, of course, will likely require tens of millions of dollars to build.

CEO Dunn, which at one point oversaw Coca Cola operations for North America, clearly has ability to scale production and distribution of a drink. The challenge will be whether he can now do it with a startup that has much more limited resources than his former employer.

Juicero’s Doug Evans On Why Now Was The Right Time To Step Down As CEO

Less than two weeks after he appeared on stage at the Smart Kitchen Summit, Juicero’s Doug Evans made a splash last week by announcing he was stepping down as the company’s CEO and handing the day to day reigns of his high profile connected juicer company to former Coca-Cola North America President Jeff Dunn. Evans will remain Chairman of the company and focus on building strategic relationships.

While the change seems somewhat abrupt, the overall shift makes sense if you look at Evans’ history.  As the former CEO of another juicing concern, Organic Avenue, Evans has showed he is long on vision for innovative new business ventures, but nowhere on his resume does he have experience scaling the type of operation that Juicero eventually needs to meet its ambitious growth plans.

When we asked him about the timing of the news, Evans pointed to the growing complexity of Juicero’s business and Dunn’s experience.

“We have built and launched a phenomenal product and simultaneously launched into both consumer and commercial, so it is the perfect time for an experienced operator to come help me scale this business,” said Evans. ‘With his deep experience running food and beverage businesses, Jeff fits the bill for what we need in every way, and I’m enthusiastic that he’s joining us.”

When you look at the challenges ahead for the juicing startup, at the top of the list is building out more production capacity for the company’s juice packs. Each pack is put together today in Los Angeles in a plant built by the company and then shipped to homes of Juicero customers. Today the company only offers the juice packs in four states – California, Arizona, Nevada and New Mexico – and Evans has told me previously the company would need to add additional manufacturing capacity over time to manage a wider rollout.

Adding additional challenges is the time urgency around creating fresh juice packs. Each pack has approximately a 7 day lifespan, meaning distribution has to be well optimized to get from plant to presser in a short amount of time.

It’s clear the company has lots of work ahead as it looks to distribute its juice packs nationwide in the US and eventually overseas, so it makes sense Evans and the board (of which Dunn was a member) would see the need to bring on more expertise to help execute on the former CEO’s vision.

Below you can read Doug’s thoughts on Juicero’s future under Dunn below. You might also want to check out his recent appearance at the Smart Kitchen Summit to hear the back story of how he built the company.

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How do you think Dunn’s experience at Coca Cola and later Campbells will be applied at Juicero?

Evans: Jeff brings a unique blend of big food brand and emerging food tech experience with him to Juicero, and I believe this unique perspective is what will be so valuable to us. On one hand, he has 30 years of experience managing and growing iconic brands. On the other, he’s passionate about the role technology and innovation can play in improving the fresh experience — and has invested in and advised some of the most promising food startups. As Juicero seeks to reinvent the fresh produce category as we know it, Jeff’s blended perspective will help us leverage the best of both worlds.

One of your new roles in the press release was focusing on strategic relationships. What does this mean and what are some examples (in abstract) of relationships you can see yourself driving?

Evans: The strategic relationships I’m focused on span everything from business partnerships in appliances, technology, food and in brand-relevant spaces, to potential customers in existing or new channels, to potential investors. As Juicero’s founder, I can uniquely tell Juicero’s story and explain our vision in a deep way.

As founder and the visionary behind Juicero, was the move to a professional CEO a sign that the company is moving into more of an execution phase?

Evans: We’ve executed aggressively since day one and will continue doing so. As Juicero expands its consumer consumer and commercial offerings, we need a leader like Jeff who has deep experience scaling fresh food and beverage businesses.

Connectivity Should Add Value, and Other Lessons We Can Learn From Juicero’s Business Model (VIDEO)

When Doug Evans decided to start a new company a few years ago, he asked himself one question. “What could I do that would have the biggest effect on human health?” he wondered. “The answer was juice.”

That might sound like hyperbole when talking about Juicero, the first connected-kitchen countertop cold-press juicer. We are talking about liquid kale, after all. But because of the company’s goals, functionality, and business model, which Evans discussed at the 2016 Smart Kitchen Summit in Seattle (watch the video below), it’s so much more. Here are three ways Juicero exemplifies a progressive mindset.

Make Something Useful

Unlike the big, bulky juicer that I have in my closet and never use, the Juicero is designed for people to use one to two times per day. It requires one touch to work and doesn’t need to be cleaned. Juicero provides ready-to-go packs of vegetables and fruit, delivered straight to your door.

“Is [a product] adding value to me as a consumer, or is it a liability because it means you have to maintain those services and consumers have to rely on those services?”

The company has set up an ecosystem that others can now use to maximize consumer health. “We have a cold supply chain, farm direct produce, IoT channel, appliances — You can use your imagination to think what else you can put through there that would make it easier for people to have other items that are made with fresh, ripe, raw, organic produce,” Evans said.

Connectivity Should Add Value

“Is [a product] adding value to me as a consumer, or is it a liability because it means you have to maintain those services and consumers have to rely on those services?” Richard Gunther of Universal Mind asked. These are essential questions in this wild west of connected-kitchen gadgets. In Juicero’s case, its app does everything from ordering automatically for enterprise accounts to telling home users that a pack in their refrigerator is about to expire. A scanner inside the juicer syncs with your app to tell you what you’re drinking, and if the pack is expired, the Juicero will not juice it. Talk about fresh.

Think Outside the Home

Evans is wisely following Keurig’s business model, focusing on restaurants, businesses, and other food service opportunities before moving to the end user market. The system only needs 10 square feet of space to work and doesn’t require someone to wash, peel, and juice produce as well as get rid of waste, making it an easy addition for restaurants and more.

Right now Juicero is only available in California and is available for purchase online. Watch the video to find out more!

Doug Evans Wants Everyone To Have Great Juice, So He Built a $700 Home Juicer

This interview is with Doug Evans, the Founder of Juicero. We interviewed Doug for the Smart Kitchen Show podcast. You can hear Doug’s interview here.

This Conversation Series interview is condensed and slightly edited for readability. You can read the full interview transcript here.

Michael Wolf: What is the Juicero?

Doug Evans: First it’s a software platform. The platform tracks the produce from the farm all the way through the Juicero press and provides visibility and transparency into the ingredients, into the source of the farm, into the nutrition, when it was created and when it expires. We built this software platform that connects to our financial planning system as well as into the cloud, into our website, and mobile and Android and iOS, so we have a full software system that actually comes with the Juicero press.

It’s also hardware, which is literally one part iPhone and one part Tesla roadster. It is a consumer device that has industrial strength and capability, all designed to extract the juice or the nectar from fresh, ripe, raw organic fruits and vegetables. Those fruits and vegetables actually come in the form of a pack, so we actually have in the Los Angeles region 110,000 square foot refrigerated LEED Gold-certified processing facility where we receive produce from the farm.

Michael Wolf: How do the packs work?

The vision is not to store inventory produce but to take the e-commerce orders and then reach out to our 14 farm partners, source the produce, have it transported to us on refrigerated trucks, and then inside our facility, we triple wash them, chop them, mix them, and put them into these packs. The packs have allowed design in engineering and their packaging a very unique QR code put on them, and that QR code can be read by an iPhone or an Android and the pack also gets read automatically by a scanner inside of the Juicero Press.

Michael Wolf: You created an entire fresh pressed juice value chain ecosystem all the way from sourcing to processing to the press. Was there any other way to do? You feel like you had to do this entire I guess delivery system and press.