Why did Zeo fail?

The news is out – the sleep coach company Zeo is shutting its doors. There has been a lot of discussion about the possible causes – hopefully the founders will do a blog post with a postmortem so that the rest of us can learn.

The one opinion out there that I disagree with, is that Zeo did not address a real pain. There is a lot of evidence out there that people today really need help sleeping.

This is the way I look at it – what is the competition to Zeo today – really? Well, one could argue that it is a cheaper device like Lark, but if you pause to think one step deeper, you realize that the real competition, is sleep “medication”. Among sleep medication users – there are two kinds – the first are the ones who need it just once in a way – would a $400 Zeo compete with OTC options like Nyquil or a glass of wine – unlikely? People with serious sleep issues would go to a doctor to get stronger medication or real help. However, it does not appear that the Zeo was marketed to doctors – they did not get cleared by the FDA and do not have any published research on their website, that I could find. Going via these channels could also have helped them offset the $400 cost, by lobbying to get it paid for by insurance (long and painful likely).

The thing that I am curious about is how much of this had to do with a failure of the coaching aspect. This is a key question, as a lot of wellness applications and devices today consider this a key part of their product. I think it is an open question as to whether people find products like the Zeo, which attempt to be “non human” coaches, helpful. I personally find it hard to stick to exercise regimes and act on self help books, which is why human coaches are still around and still matter. Unlike these passive approaches, a good human coach actively leads you to your goals – they dont just make suggestions but they have conversations with you, coax you, cajole you, connect with you at a human level and provide you with moral support along the journey – all things that a sterile machine may not really be able to do – real and good coaching is hard

Zeo is an offshoot of the quantified self movement which is trying to cross the chasm from early adopters to the masses. There are going to be various people attempting to make the leap, each of whom makes different bets. So while it is sad to see such great entrepreneurs having to go home, it is neither surprising nor are they going to be the last ones.

While I have not used their product, I think they did some things which I think are really important to succeed here.

• To succeed one has to go beyond just data collection, and address a concrete scenario. Collecting data to explore and geek out is not going to appeal to a mass market.
• The scenario has to address a real searing pain head on. Issues like sleep and weight loss are good examples.
• Devices should not just present data, but rather, render interpretations, though rendering compelling interpretations may be harder than we think.