You ever think about those big companies from years ago that suddenly no one talks about anymore? Well, inspired by OnlyFans’ reversal of its sexual content ban, u/WolfgangCaesar asked people to share other companies that (nearly) bankrupted themselves through poorly thought-out or unnecessary decisions.
People came out of the woodwork to answer, so I decided to look further into what actually happened to these companies, and frankly, it’s impressive. So here are the 33 companies below:
1.
Let’s start with the company that inspired the question, Only Fans, which “[took] back its ban on sexual content” within days of announcing it.
2.
“RadioShack. Those guys just couldn’t make their niche happen and never attempted to evolve.”
3.
“One time, Red Lobster offered an unlimited [snow] crab leg deal. They brought the servings out slowly and were like, ‘Nobody is going to sit there for six hours and just eat crab legs.’ Actually, lots of people did — so many, they lost millions.”
4.
“Friendster shot themselves in the foot with a ton of bad decisions that led to stuff like long login times for basically no reason. It is weird to think that for a short time, Friendster was big and hip enough that I actually had it on one of my business cards around 2000.”
5.
“MySpace. All it had to do was not change, so people could come back to it after checking out Facebook. Instead, they got rid of everything people liked about the site and didn’t make any beneficial changes. When people popped back in looking for a Facebook alternative, they found a weird, new music-focused version.”
6.
“Can we get an honorable mention for Staples and its multiple attempts to merge with Office Depot, despite the fact that they’re both on track to die within the decade?”
7.
“Blockbuster had the chance to buy Netflix, but they were extremely stupid and turned them down. Now, they’re gone and just a fond memory of the ’90s. They were on their way out even before Netflix with services like Red Box and Game Fly, which mailed movies to you. Man, they were stupid. The writing was on the wall for years.”
8.
“Netflix almost bankrupted themselves as they made the transition from DVDs. They had a period where they dropped to dangerously low subscribers.”
9.
“Quiznos. The corporate office decided to buy the vendors and then contract all of the franchises to only buy materials from corporate with a price hike. The margins got way too high, and all of the stores went out of business. They shot themselves straight in the foot.”
10.
“JCPenney tried to stop bullshitting customers, and it backfired. They said no more sales. They were just going to price everything low because pretty much all sales at department stores are lies, anyway. You’re not really getting 70% off — the retail price was deliberately set stupid high to convince you it was a great deal, but the discount price is the actual value of it. JCPenney’s heart was in the right place, but ultimately, it failed because customers are really that dumb and would rather be lied to.”
11.
“The Hoover UK free airline ticket disaster. The vacuum company devised a plan to offer free round-trip airline tickets if customers bought at least £100 in Hoover products. They underestimated how focused people would be to get free stuff — so they then made it as difficult as possible to actually claim the tickets. People would buy the cheapest thing they could to qualify, send all the forms off perfectly, then try to take legal action when the free flights didn’t happen.”
12.
“WeWork was going great right up until the IPO prospectus, and everyone realized that CEO Adam Neumann was a crazy person. Neumann himself managed to personally walk away with $1B in exchange for lighting tens of billions of dollars of investment on fire. Truly epic.”
13.
“Xerox. They had a research lab, the Palo Alto Research Center (PARC), that invented the personal computer, and a working prototype in 1973. This was a time when the concept of a personal computer didn’t exist — everything was mainframes. They also invented laser printers, computer graphical interfaces, WYSIWYG text editor (a precursor to Word, etc.), Ethernet (which much of the internet runs on), and much more. Steve Jobs got a tour of PARC in 1979 after Xerox sat on the invention doing nothing (they made copiers, goshdarnit), and the rest is history. Xerox then almost went bankrupt in 2000 as the world transitioned to email, powered mostly by personal computers and the internet.”
14.
“Teledesic. Their goal was to have a global network of low-Earth-orbiting satellites that provided broadband access to pretty much everyone on the planet. They were financed by tech titans in the wireless communications space. It all seemed like a great idea. The only problem was that the technology wasn’t there yet. They went bankrupt in 2002. The Teledesic Case Study is taught at Harvard Business School and other MBA programs as a cautionary tale.”
15.
“Photobucket changed its terms of service back in 2017. It then required a yearly fee for all those images you previously posted on it for free.”
16.
“The UK jewelers, Ratners, nearly went under as a result of a cringeworthy speech from their CEO in 1991.”
17.
“In 1998, Yahoo refused to buy Google for $1 million. In 2002, Yahoo [was in talks] to buy Google, but Google wanted more money. Yahoo refused the offer. In 2006, Yahoo wanted to buy Facebook for $1 billion, but Facebook backed out. In 2008, Microsoft offered to buy Yahoo for $44.6 billion, but Yahoo refused. In 2016, Verizon bought Yahoo for $4.8 billion.”
18.
“On paper, Sears had everything to be the e-commerce retailer that dominated the globe. In 1984, it partnered with IBM to create ‘Prodigy,’ one of the first proto-ISPs that offered all sorts of online services (except buying stuff from Sears) years before the World Wide Web existed. By 1985, Sears offered its own credit card, Discover, to rival MasterCard and Visa. It even had its own insurance company in Allstate. In theory, Sears was posed to make e-commerce a thing back in the late ’80s and sweep the world in the ’90s with no chance for outsiders like Amazon — who had to build their stuff from the ground up — to catch on.”
To continue the Sears story: “Sears ended their catalog/mail-order business in 1993. For over 100 years, they had sold everything from hubcaps to houses via mail order and shipped them all over the country. Amazon was founded in 1994.”
19.
“Kodak completely went under when they chose not to adopt digital photography. They eventually came back several years later, somehow.”
20.
“A&W created the third-pounder. It was the same price as McDonald’s quarter-pounder but bombed massively. When they tried to find out why, it was discovered that Americans thought they were being cheated because three is a smaller number than four. A&W — realizing they can’t explain grade school fractions to fully grown adults without coming across as condescending assholes — quietly took the burger off the menu.”
21.
“In 2012, after a three-year hiatus in the sport, the Lotus F1 team signed driver Kimi Raikkonen. His contract included a clause that stated Raikkonen would earn €50,000 for every point he scored in the two seasons of his contract. Raikkonen went on to finish third in the 2012 championship and fifth in the 2013 season — which was exceptionally impressive for Lotus. In doing so, he scored 390 points in two seasons and earned €19.5 million off of that bonus alone. This led to Lotus almost filing for bankruptcy.”
22.
“Blackberry. Most popular smartphone in the world — then they were less than 1% of the market share, and their stock value dropped. A couple of years ago, they announced that they would focus more on software and essentially gave up making phones. Lots of BlackBerry executives took advantage of their market share and thought a flat, touchscreen phone wouldn’t take off the way it did. How the mighty have fallen.”
23.
“Circuit City. It was a major retail chain in the 1980s that collapsed under mismanagement. Its arguably biggest blunder was firing all of its experienced, better-paid workers for cheaper, inexperienced ones. Apparently, selling merchandise and keeping customers happy are important in the retail business. Who knew?”
24.
“Borders Books. A conversation happened between Amazon and the giant Borders Books. This Internet thing was starting to look like it would harm retail sales, so Borders agreed to sell books online through Amazon. By 2007, Borders ended its marketing alliance with Amazon.”
25.
“Quibi — when it decided that 10-minute clips watched in portrait on a commuter train is the future of home entertainment.”
26.
“Ayds Diet Candy. They didn’t change their name after the emergence of the AIDS virus.”
27.
“Yik Yak. It was a completely anonymous message posting app at first. Obviously, it became a fun anonymous messaging app. They then started to make it less anonymous by introducing usernames which — while they can still be throwaway usernames — certainly made people lose the favor of the app. They eventually shut down.”
28.
“Vine. It seemed like the best thing at the time.”
29.
“Schlitz. Throughout the ’60s, it was one of America’s biggest national beers. In 1974, Schlitz’s president and chairman, Robert Uihlein, Jr., believed beer drinkers couldn’t distinguish their favorite beer from other brands and oversaw the introduction of a slimmer brewing process. It replaced barley with corn syrup and used silica gel as a preservative during the brewing process that was then filtered out, i.e. didn’t have to be listed as an ingredient. Instead, the beer spoiled faster, grew cloudy on racks, didn’t produce a frothy head when poured, and was flavorless — resulting in a 100-million bottle recall. Schlitz also didn’t realize light beer was becoming a thing, so it got its clock cleaned by Bud and Miller. It then ran an ad campaign with some belligerent-sounding guy threatening to kill another guy, who was off-camera, if he took his Schlitz away. By the ’80s, it went back to its original brewing process, but the damage was done.”
30.
“Digg was bigger than Reddit until they decided to force changes on the site. The changes were immensely unpopular — to the point where users began posting Reddit links as a way of rebellion. Digg stuck to their new ways and collapsed.”
31.
“Schwinn. The executives of America’s most venerable bicycle maker could not be convinced that mountain bikes were anything more than a fad. They made one and called it the Klunker (yes, really). They then got an Asian company to design a mountain bike for them. Today, Schwinn is just a brand name someone else owns.”
32.
“MoviePass was a weird one. Their model was too good to be true. They lost money on every subscriber who was seeing more than two movies a month — which was most of their subscribers.”
33.
And last but not least, “There was a donut shop by my high school. It opened at 6 a.m. and closed at 5 p.m., so students would be there every day before school started at 7:30 and after school ended at 2:15. They changed their hours to 8 a.m. to 3 p.m. and couldn’t make any more money. They shut down a few months after the change.”
Did you remember all of these companies and know this is what happened to them? What other companies would you add? Let me know in the comments below!
Source: https://www.buzzfeed.com/victoriavouloumanos/successful-companies-that-bankrupted-themselves