Once upon a time in 2013, I taught a course called Building the New Venture to University of Chicago undergraduates. Teams of students took concepts of their choice and explored the potential for a business, developed minimum viable products for testing, and presented go-to-market strategies in a demo-day format. The best concepts (as judged by a panel of investors and successful entrepreneurs) received seed funding from the business school.
One of my students, Arnav, was from India. His parents were in the tea business, and he was convinced that Americans neither understood nor appreciated tea. If they only had an opportunity to try real premium tea the way it was enjoyed in India, US consumers would beat down the doors to buy it, whatever the price.
He and his partners Shivani and Ryota did extensive due diligence with customers and competitors. They talked to industry leaders. They did blind testing with classmates and faculty. And they discovered, to their dismay, that American consumers couldn’t distinguish the differences between fine tea and bog-standard bag tea. More distressing, they learned that the tea export/import business was controlled by big interests who would make it difficult for their business to survive, let alone thrive.
Disappointed, Arnav, Shivani, and Ryota had to find a plan B. Half the term was gone, and they needed a concept to test, a business model to develop and present. They proposed a new idea: an under-desk elliptical trainer. Again, they explored currently-available products – and found them wanting. They interviewed office workers and stay-at-home parents, call-center employees and the retired.
Results were promising.
Without experience in either the exercise business or manufacturing, they found a Chinese company willing to build a prototype to their specification. By the end of the term, they had a business plan for their new little device, which they named Cubii, and a working model that the judges could slide under their desks and try.
Stealing victory from the jaws of defeat, Arnav and Shivani were one of three companies to be awarded a few thousand dollars in funding. Undergrad projects are exercises – a learn-by-doing approach – and the students usually spend the awards on celebrations.
But not Cubii.
Arnav and Shivani asked if I’d meet with them weekly to develop a go-to-market strategy. They went across Chicago and signed up early adopters. They did a kickstarter and used the funds to manufacture the first lot of one thousand Cubiis (many of which went to early investors) and then another thousand to meet demand. They continually iterated the product based on feedback. They stayed close to their customers, watched how the device was used, developed an app to track fitness, provide in-office competitions, workout schedules, and utilities for rehab and conditioning (as well as to provide them with real-world usage data). On very short money their belief and enthusiasm (and youth) propelled Cubii onto retail shelves, shoulder-to-shoulder with the big manufacturers. And along the way they gained big-name (unpaid) endorsements from Khloe Kardashian and others.
Revenues topped $10 million per year, a success by anyone’s measure. Not to mention their marriage in 2017 that cemented a great team beyond the business.
And then, last year, Covid and the exercise-at-home market made Cubii a red-hot property. Last month, Gridiron Capital, a private equity firm bought a controlling stake for $100 million, leaving Arnav and Shivani with a handsome payout, revenue from future growth and new products, and the chance to explore the tea business. Or anything else they’d like to do anywhere else in the world.
Not exactly a fairy tale, though it reads like something out of the Disney catalogue. It why many of us do what we do. It’s the craic after all the heavy lifting.
Read more about Cubii here:
Educator (Associate Professor) / Entrepreneur / Leader of angel communities /
Entrepreneur in residence at PorterShed and BioExcel