A local tech startup with offices in Birmingham, Dallas and Shenzhen, China, is closing.
Fledging has stopped selling and will stop offering support Dec. 31, according to a letter posted on LinkedIn by CEO Ethan Summers on Nov. 21.
"It’s easy to think of this as a failure. After all, it didn’t work, right?" Summers said. "It’s only a failure if it was a bad idea. Amazing products that serve real needs, are built to last and are affordable are always a good idea."
Five years ago, Fledging founder Weida Tan had an idea for a company that created premium electronics with a focus on storage, data transfer and power delivery. Tan was a Chinese exchange student who came to the University of Alabama at Birmingham.
"What a cool story," Summers said. "A Chinese exchange student landing in Pell City, coming to UAB, inventing a better way of doing business and building the chance to change an industry. Anyone who’s built anything understands how much of your life you pour into the project."
Summers said the company is closing because it "couldn’t make premium consumer electronics for fair prices work," adding that the company struggled to solve archetypal challenges in its segment, including large inventory carrying costs relative to its small volume, the difficulty of continuous innovation, crowded and expensive customer education, long B2B sales cycles and widget shops pumping throwaway products.
"We also ran into unexpected challenges," Summers said.
Those challenges included the Covid-19 pandemic and its consequences on supply chains, consumer spending, access to capital and the labor market; the first two-quarter retraction of the consumer electronics segment since 9/11 and the founders exiting for personal reasons.
During its operation, however, the company created some award-winning products, including the MacBook SSD DIY upgrade kit, the Thunderbolt 3 external SSD, an integrated hub+case for tablets and the Spruce Charger.
Other highlights included building relationships with major partners including Motion Industries, Blue Cross Blue Shield of Alabama and Protective Life and landing distribution partnerships in the U.S., the EU, the United Kingdom, Japan and Australia.
Not all of the products were winners, though.
"We built some duds along the way," Summers said. "The VITE Charger, a pocket-sized low-wattage charger, was non-differentiated. A competitor 10 times our revenue launched the exact same product the month we launched our crowdfunding campaign. Ouch."
Summers admitted to the team making some bad decisions, including "panic-driven overstocking, betting on products that couldn’t be A+, overspending on paid ads before (Fledging's) messaging was locked in, underestimating B2B sales cycles (and) keeping team members far too long."
Ultimately, Summers said he is most grateful for the Birmingham community.
"People said you can’t raise money in Birmingham, or for consumer electronics, but we raised $1.6 million in seed funding mainly from Birmingham’s wonderful investment community, and made a new partner in New Orleans," Summer said. "People and companies tripped over themselves to help us — advice, connections, business and sharing their hard-won relationships.
"Programs like UAB’s Commercialization Accelerator, Innovation Depot’s Velocity, Endeavor’s ScaleUp and Bronze Valley challenged us to be better at every stage. Innovation Depot provided a rock-solid home among fellow entrepreneurs."
Summers concluded with the sentiment that the company needed twice as much money and half as many mistakes to succeed, calling Fledging an experiment well-run.
