So Long, and Thanks for all the Euros!It looks like United Dogs and Cats (UDC) is shutting down for good. Two weeks ago, the main person (Kristiina Kala) behind what's left of the project announced her departure on Facebook:
A Brief History of What Could Have BeenBack in 2008, the site, which is a social network for pet owners, was widely heralded as the next great Estonian innovation, ready to take the world by storm. According to a press release where they announced their $235,000 investment, the CEO of ASI, Tauno Tats: "UDC has a monolithic team that can guarantee fast growth and be successful in putting all pets in the world to the web."
One of the UDC founders, Ragnar Sass, was hailed by the press as part of the new generation of Estonian entrepreneurs ready to take on the world. (Never mind that his previous ventures, the web portal uno.ee and the TV station Neljas, are both no longer in operation.)
In 2009, ASI increased their investment and also convinced the state-owned Estonian Development fund to come in, with a total additional investment of 480,000 EUR. Your taxpayer money at work!
That brought the total investment to 650,000 EUR. That's a significant sum, and by our estimates, fewer than 10 Estonian startups have ever received investments at that level or above. With the great team Mr. Tats alluded to above, along with all this money, surely that's a recipe for success, right?
Wrong, of course. Within one year, the company laid off all its workers. According to the business registry, the company was finally dissolved in May 2012. (The portal was then taken over by a new corporate entity, United Pets OÜ, which seems to have no connection with the founders.)
Our TakeWe really like the idea of a social network for pets. Pet owners typically consider their pet as a family member, and they're also willing to spend good sums of money on products for their pets. There are many opportunities to tie this together, like to offer products based on the type of dog the user has.
We think the failure here was a failure in execution, and not a bad idea. Unfortunately, we see this all too often with Estonian companies that have a good idea but fail to make it a success on the world market. Both Rate.ee and Now Innovations (ParkNow) come to mind as examples, and we'll provide our analysis of both those companies in the future.