A Postmortem of the Bodega Debacle

What do you get when you take a dash of the empty “disruption” philosophy that permeates Silicon Valley, add in the trend that absolutely everything that needs to be a “smart” device and mix in just a hint of racial insensitivity? You get Bodega, a startup that had a disastrous rollout late last year as the Twitter tech sphere’s reactions can charitably be described as mixed. I took note of Bodega and wrote about it fairly frequently on Twitter since I tend to work with local merchants.

I was skeptical about it and not as prone to the worry that this would take another hatchet to small businesses, but I thought an analysis of what went wrong would be in order. Bodega, as it turns, perfectly highlights the disconnect between Silicon Valley mentality and the rest of the United States (let alone the world).

The name Bodega, of course, stems from the local and often institutional corner stores in urban areas of the United States, which tend to be run by immigrants. You might call your equivalent of this a deli, a convenience store, or you may just rely on a gas station. It’s where you buy your morning coffee, your drunken 3 AM Burritos and the emergency supplies that you need. Just about everybody in the United States has one.

So of course, someone set out to “disrupt” them. Bodega the startup is the brainchild of two ex-Googlers and this enterprising startup had the vision of installing five-foot-wide, wifi-enabled boxes stocked with non-perishable goods into apartment buildings which we could access by downloading an app, and picking up the items we’d like in view of a computer-vision camera which will automatically charge us for our purchase.

If this is sounding like a glorified vending machine with the added inconvenience that plagues self-checkout grocery lanes, don’t worry, you’re not alone in wondering why someone is building a vending machine version of your store that has fewer items and accepts Apple Pay. Though because this is Silicon Valley, of course it secured investment from major firms like First Round Capital and Forerunner Ventures, as well as Google and Facebook executives.

The media rollout, which was profiled in Fast Company, was met with a swift and derisive backlash. Some pointed out the logistical nightmare, others pointed out how frankly unnecessary and self-indulgent this was, and many pointed out the insensitivity in taking aim at bodegas themselves misappropriating immigrant culture and by styling itself Bodega. This all lead to a penned response by cofounder Paul McDonald, and the starting point for my analysis.

The first problem with McDonald’s response is that it seems to be grounded in the same empty desire to “disrupt” things that I alluded to earlier without there even being any context for methodology for what exactly is being disrupted. Let’s look at his answer to the big question on whether or not it’s his intent to “end” corner stores:

Are we trying to put corner stores out of business?

Definitely not. Challenging the urban corner store is not and has never been our goal.

Corner stores have been fixtures of their neighborhoods for generations. They stock thousands of items, far more than we could ever fit on a few shelves. Their owners know what products to carry and in many cases who buys what. And they’re run by people who in addition to selling everything from toilet paper to milk also offer an integral human connection to their patrons that our automated storefronts never will.

We want to bring commerce to places where commerce currently doesn’t exist. Rather than take away jobs, we hope Bodega will help create them. We see a future where anyone can own and operate a Bodega — delivering relevant items and a great retail experience to places no corner store would ever open.

This directly contradicts what he said in his own words in that Fast Company article:

Bodega’s logo is a cat, a nod to the popular bodega cat meme on social media–although if the duo gets their way, real felines won’t have brick-and-mortar shops to saunter around and take naps in much longer. “The vision here is much bigger than the box itself,” McDonald says. “Eventually, centralized shopping locations won’t be necessary, because there will be 100,000 Bodegas spread out, with one always 100 feet away from you.”

So which is it? Will centralized shopping locations not be necessary at all or is your intent to not challenge the urban corner store? It’s honestly difficult to tell. McDonald seems to genuinely believe that actively aiming to make bodegas obsolete (by his own admission) will somehow not affect them and paradoxically give rise to more jobs if Bodega takes off.

What’s most remarkable about the answer on McDonald’s blog is that he sums up almost perfectly why Bodega as a concept is redundant and self-indulgent. You want to bring commerce to places where commerce doesn’t currently exist? That’s an awesome idea! There are huge swaths of the rural United States where people rely on unhealthy food from convenience stores to do all of their shopping or have to drive an hour just to get to a grocery store, a phenomenon known as the “food desert.”

A resident of Harrison called me for help several months ago because the owners of their local grocery store have gotten sick and need to sell or shut down. If they close, it’s a 50 mile drive to the next nearest grocery store.

Except…by McDonald’s own admission he’s specifically targeting urban environments that are awash in commerce. He said in his own interview that he’s trying to make centralized shopping locations unnecessary including those same bodegas. One look at Bodega’s own map will show you that current Bodega locations are heavily focused in San Francisco – because of course they are – with the most outlying ones being in the commerce deprived areas of, uh, Oakland and Menlo Park.

Even sillier is the fact that Bodega readily concedes its own limitations. It’s never going to have as many items as an actual bodega or convenience store – the kind it’s allegedly competing with – and it certainly won’t offer very specific items you may occasionally need like certain types of batteries. Nor will it offer frozen items, sandwiches, or anything heated.

On a personal level I used to live in an apartment building situated perfectly in the type of uptown environment Bodega saw as a prime target. Except there were three different stores within a two minute walking distance of me, including a 24-hour one. I would have never used Bodega short of the apocalyptic blizzard that happened one time.

I have to take an aside quickly to – in keeping with absurd logic at play – point out McDonald’s response to accusations of cultural insensitivity regarding co-opting the name Bodega while actively setting out to make bodegas obsolete (his words, not mine, remember):

We did some homework — speaking to New Yorkers, branding people, and even running some survey work asking about the name and any potential offense it might causeBut it’s clear that we may not have been asking the right questions of the right people.

Paul, buddy, if you don’t see the issue with feeling the need to do survey polls on whether or not something is culturally insensitive I don’t know what to tell you. Especially considering your bleeding logo is a cat.

Paul’s response post goes on for a while, following up on the contradiction of insisting that it’s not going after bodegas with superfluous commentary about creating jobs, bringing new retail experiences, thoughtful disruptions, and so on. The anger receded after an initial burst, but the punchline to this whole saga is that Bodega has far fewer locations than initially advertised. They had just 14 instead of 30, with the remainder being in preliminary talks with the company. Bodega has predictably gone quiet since

In the end, Bodega doesn’t feel like it was done with malicious intent. McDonald sincerely seems to believe he was bringing some kind of valuable public service to apartment buildings and offices everywhere. Except Bodega feels more symptomatic than anything of a mindset permeating Silicon Valley; that mindset being a childish desire to play with the latest tech toys rather than really focus on providing innovation and disruption that people really need (or even want; seriously, was anyone asking for this?). This mindset is augmented by that magical desire to disrupt.

If Bodega wanted to bring commerce to areas without it, there are massive chunks of the United States that would benefit from this. You need to live in or near a dorm, office, gym, or apartment building, which are private and generally in economically well-off areas. The people who would really benefit from commerce being brought to areas where it doesn’t exist likely don’t know what Bodega is and never will.

Disruption is amazing when it produces new products and services that are more convenient, easier to use, and designed to make life easier. Except disruption is a byproduct of creating one of those new goods or services. There’s a reason that the music industry was disrupted by the rise of digital music, Napster and iTunes in a way that all but obliterated CDs and brick and mortar music storefronts. You could finally purchase the song you want at a more affordable price point and take it with you in on a portable device without lugging around one or more CDs.

The difference between something like Napster or iTunes versus Bodega is that Bodega consciously set out to disrupt something without addressing any underlying concerns or issues. Disruption in and of itself is not some kind of valorous endeavor. You’re not fixing problem or bringing services to people who don’t have them when you launch a startup like Bodega. You’re putting the cart before the horse when you emphasize disruption above all else as if it’s some inherently noble practice, especially when you seem to be combining it with a desire to ride the coattails of popular trends rather than innovative and build on them.

Beyond the cultural appropriation and the stated intent to go after mom and pop businesses, Bodega feels like a backlash to the amalgamation of these self-indulgent feels like an amalgamation of the trends that have exploded in Silicon Valley: Machine learning, algorithms, automation without it actually streamlining anything, and generally the use of high-end technology as some kind of magic remedy for problems that founders and their investors have created themselves.

We don’t need a smart garbage can. We don’t need the ability to change our shower temperature from an app. Yet these founders are spending millions of dollars and countless hours of time trying to solve problems that don’t really exist because it lets them play around with Wifi-enabled devices, drones, algorithms, automation, or whatever other shiny toys they’re interested in.

While I’m at it, maybe we can leave behind this almost fanatical attempt to eliminate human communication and interaction from every facet of modern life. In an article listing in hilarious fashion Bodega’s problems, this stood out to me:

Here’s actual-bodega patron Dannielle S. from Crown Heights talking to CityLab’s Teresa Mathew about Bodega: “I’ve been coming to this bodega at 690 Franklin Avenue 27 years. When you’ve been coming to a bodega for 27 years, it’s not just convenience. It’s about the relationships you build with the owners of the establishments, those good mornings you look forward to, those personal conversations. People don’t just come to the bodega for their bread, their milk and their eggs. We come for our daily meet-ups, we come for our hellos and good mornings. And a box can’t do that for us. In the bodega we all look out for each other because we understand when one comes in and does something wrong it affects all of us. A box doesn’t have a feeling. I get feeling when I walk into this store in the morning: love. It’s like walking from home to home, like you’re walking out of your dining room and into your pantry.”

I’ve spoken before about how a major problem with people in the marketing industry is their tendency to sell goods or services that they want to sell as opposed to what consumers or the buying public at large really want. The more I thought about it when writing this article, this is Silicon Valley’s cultural problem in a nutshell. When so much of your attention is given to self serving, self indulgent inventions like Teforia, MakeSpace and Juicero, maybe it’s time to reevaluate where you invest your money.

Silicon Valley, stop it. Just stop it. High profile failures like Juicero, that Coolest cooler, and even the debacle of a company like Bodega must surely have convinced you on some level that you can’t just make millions of dollars by setting out to randomly disrupt industries for no real reason by slapping related products with Wi-Fi, Bluetooth, Bitcoin, or whatever is the hot trend. “Move fast and break things” was bad advice even before it got Facebook into trouble. You need to stop following it, because Bodega represents all of the image problems that you’ve been having lately.

Working with small businesses – I’m talking actual Main Street-type ones – has shown me that Silicon Valley has immersed itself in a bubble of high end tech and often fallaciously assumes everybody wants pieces of this technical pie. Not everything has to be a smart device, not everything has to be automated (despite the prolific benefits of automation), and not every single piece of human interaction has to be scrubbed out of existence. It would do you well to think about life outside the tech bubble. There’s a lot of opportunity here; just sell what people need.