Quibi: The $2 Billion Failure
In April 2020, Jeffrey Katzenberg (ex-DreamWorks) and Meg Whitman (ex-HP, eBay) launched Quibi, a revolutionary mobile streaming platform. Six months later, it was over.
How can you burn 2 billion dollars so quickly?
The Initial Concept
Quibi (short for "Quick Bites") offered short videos of 10 minutes maximum, exclusively on mobile. The concept: premium content consumable during commutes, coffee breaks, or waiting in line.
Strengths on Paper
- Renowned investors: Disney, NBCUniversal, Sony, Warner
- Premium content: Steven Spielberg, Guillermo del Toro, Chrissy Teigen
- Innovative technology: "Turnstyle" allowed seamless switching from portrait to landscape
- Substantial budget: 2 billion dollars raised
Fatal Mistakes
1. Catastrophic Timing
Quibi launched on April 6, 2020, in the middle of the COVID-19 lockdown. Their main selling point — content for mobile moments — collapsed when everyone was stuck at home.
"We made all the right choices... except timing" — Meg Whitman
2. Founder Arrogance
Katzenberg and Whitman came from the old media world. They:
- Ignored user feedback requesting social media sharing
- Refused to put the app on TV for months
- Underestimated TikTok and YouTube which offered free short content
3. The Content Problem
- No ability to share clips on social networks
- Shows that created no cultural conversation
- "Premium" content but without identity or clear target audience
4. Broken Business Model
- $8/month (with ads) or $13/month (without ads)
- For content nobody was asking for
- Against Netflix, Disney+, and free YouTube
Failure Numbers
| Metric | Result |
|---|---|
| Investment | $2 billion |
| Lifespan | 6 months |
| Paying subscribers | ~500,000 |
| Total downloads | 5.6 million |
| Cost per subscriber | ~$4,000 |
Lessons Learned
1. The Market Is Always Right
Quibi ignored that nobody was asking for "Netflix for mobile." Users wanted to share, discuss, and watch together — everything Quibi prevented.
2. Past Experience Can Be a Handicap
Coming from traditional media blinded the founders to new consumption habits.
3. Too Much Money Kills Agility
With 2 billion in pocket, Quibi never needed to pivot or listen to the market. Easy money killed the survival instinct.
The Epilogue
In January 2021, Roku acquired the Quibi catalog for a fraction of the production cost — estimated at less than 100 million dollars.
The content is now free on the Roku Channel.
Quibi will remain in the annals as the perfect example of what happens when you ignore your market, regardless of the money and talent at your disposal.