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DrawQuest Shuts Down After Failing to Monetize
Posted By Shawn Hessinger On January 22, 2014 @ 4:30 pm In Startup | 7 Comments
DrawQuest , an app centered around daily drawing challenges, announced  it was shutting down this week. On its official blog, the DrawQuest team announced the app would see no further active development. However, there will be an effort to keep it live for a few more months for the benefit of the user community.
In the tech media, some expressed surprise at the decision to pull the plug. The app has 1.4 million downloads, 550,000 registered users, 400,000 monthly users and 25,000 daily users.
Meanwhile, Founder and CEO, Chris Poole, posted a fairly transparent postmortem on his personal blog, spelling out some of the team’s missteps.
First, the company switched products too late in the game with too little money left to develop a new idea. Poole explains :
“Building any business is hard, but building a business with a single app offering and half of your runway is especially hard (we created DrawQuest after the failure of our first product, Canvas).”
Poole had raised about $625,000 in seed funding from investors Ron Conway, Marc Andreessen, Chris Dixon, Kenneth Lerer and Joshua Schachter in 2010, TechCrunch reports .
After that came another $3 million in 2011 from Union Square Ventures’ Fred Wilson, SV Angel, Lerer Ventures, Andreessen Horowitz, Founder Collective, and Joshua Schachter.
The original funding was to develop Canvas , a forum for sharing and discussing online graphic and art images. But then Poole’s team switched to DrawQuest instead about a year ago.
Poole said the team had simply failed to make the business side of the equation work:
“I’ve come away with new found respect for those companies who excel at monetizing mobile applications. As we approached the end of our runway, it became clear to us that DrawQuest didn’t represent a venture-backed opportunity, and even with more time that was unlikely to change.”
DrawQuest had hoped to monetize by selling drawing pencils for its app the way other games sell extra lives, but found it difficult to do.
Finally, Poole had hoped to find an acquisition opportunity for the company but to no avail. He told TechCrunch he believed part of DrawQuest’s problem was its inability to crack what he said was the “all important” million monthly users.
Digital properties are often courted for their rapid growth even if they haven’t found a business model, so this may have been the problem with finding another company interested in acquisition.
In his post, Poole said he hoped his transparency would help other startups.
“One thing I’ll be doing more of is writing about my experience. Partially because it’s therapeutic, but also because if there’s a silver lining in all of this (and there is), it’s that I can help educate others about a path fraught with hardship, but rewarding nonetheless.”
Article printed from Small Business Trends: http://smallbiztrends.com
URL to article: http://smallbiztrends.com/2014/01/drawquest-shuts-down.html
URLs in this post:
 DrawQuest: http://drawquest.com/
 announced: http://blog.drawquest.com/post/74083057195/sad-news-an-important-message-from-team-drawquest
 explains: http://chrishateswriting.com/post/74083032842/today-my-startup-failed
 reports: http://techcrunch.com/2014/01/21/when-goods-not-good-enough/
 Canvas: http://canv.as/