A few months after emerging from stealth, Supply Drop Inc. has folded.
Founded in July 2019 by Andrew Busey and April Downing, the e-commerce subscription company used artificial intelligence, predictive analytics and conversational interfaces, such as texting, to automate the purchase and delivery of household items, such as toilet paper, paper towels and laundry detergent.
But Downing, who had been chief operating officer, said in an April 12 email that “the supply chain proved too much of a challenge given our size and scale at Supply Drop.”
“I feel extremely fortunate to have found an Austin-based company with such scale and opportunity while also having an amazing culture,” Downing also said in the April 12 email. “I feel good knowing that we helped with thousands of deliveries of goods our customers needed when they needed them the most.”
Supply Drop had raised at least $2 million. Investors include Austin-based startup incubator Capital Factory; Austin-based venture capital firms LiveOak Venture Partners and Next Coast Ventures; and Firebrand Ventures, a VC firm headquartered in Kansas City, Missouri.
Downing and Busey, who had been CEO of Supply Drop, did not respond to requests for interviews sent by email and through LinkedIn.
According to Failory, the failure rate for startups in all industries is about 90%, according to National Business Capital & Services. It's part of the reality of starting a new company and pursing a new idea.
Among Supply Drop's last social media activity was on March 23, when it added a “shop now” button to its Facebook page.
The global supply chain has been racked by shortages in a wide variety of sectors, affecting items from ketchup packets to construction materials.
Busey previously co-founded and was CEO of Conversable Inc., which created chatbots allowing big brands like McDonalds, Dunkin’ Donuts, Chick-fil-A and Pizza Hut to communicate automatically with customers. New York City-based LivePerson (Nasdaq: LPSN) in 2018 acquired Conversable. He also founded and was CEO of Austin-based game companies Team Chaos LLC and Challenge Games Inc. Both of those were acquired by San Francisco-headquartered gaming company Zynga Inc. (Nasdaq: ZNGA) — Team Chaos in 2016 and Challenge Games in 2010.
Downing now is chief financial officer at Austin-based customer engagement company Khoros LLC. The company announced her hiring April 12. Khoros was formed in 2018 out of the merger of Austin-based Spredfast and San Francisco-based Lithium with the backing of Vista Equity Partners, the high-profile Austin-based buyout firm. The company said in the announcement that more than "2,000 brands" use its tech to "power approximately 500 million daily digital interactions." It has 11 offices globally and is led by CEO Jack Blaha.
Prior to co-founding Supply Drop, Downing was the first COO at Civitas Learning Inc., an Austin-baed maker of software for higher-education institutions, for just more than a year. Before that, she was chief financial officer for more than five years at Austin-headquartered WP Engine Inc., which helps companies and organizations build and manage websites that use WordPress. WP Engine in January 2018 obtained a $250 million investment from California-based private equity firm Silver Lake Partners.
Austin Inno Editor Brent Wistrom contributed to this report.
