Came across this excellent article today by the GM Europe of Cake.
Good analysis and read.
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Interesting read. Lots of good insight on what makes or breakes a business. However, the sales-guy perspective I feel he is âwalking like a cat around hot porridgeâ (swedish for âbeat around the bushâ) - Design.
I will frame my take around quotations FTA:
In addition at CAKE, Design drove Engineering leading to technical incoherences in the vehicle built. The right balance between design and parts selection / optimal manufacturing process in a cost effective manner should be found
In short - egos. Enforce this with:
CAKE was not customer centric enough. No customer insight was gathered, just pushing existing products to the market hoping that they will sell by themselves using the brand aura that has been created around the products
Because, CAKE as a whole, was a Marketing organisation, they managed to create an full universe around their products through outstanding content and brand identity, recognisable by anyone. And this is unique ! Hats off
So the organisation believed they had world class design, fueled by all the design awards in the world and LinkedIn pats on the back.
Yet for every 10 likes on Li, you had 100 barfing emojis on facebook and motorcycling forums. The folks who actually would consider to buy a bike (at any price!, let alone overpriced) HATED its design. They also saw through the bullshit of âsaving the world with a âŹ10k toy.
I think the writer tries to hint that there was internal friction but Design was untouchable.
In every company you have the founder view of what a product should look like but at the end, there is market reality. Listen to your teams, get customer insights, accept comments, critics, different views. Acknowledge them and integrate it to ensure full alignement
So for being lauded as a âdesign led organisationâ, the lack of customercentrism and manufacturing common sense both - Iâd venture Design was again seen as fluff and this case study will do a disservice to the design industry. If it blows up to the level of HBR writing a piece on CAKE it could cause some serious damage to all the good things Apple did âfor usâ in the board rooms.
Apparently the founder ans the design team have founded a design agency. Will be interestinflg to follow.
My take was that it was design led and the founder was part of the design leadership. I think I read he was founder of POC and something else?
To me it seems it was just typical founder tunnel vision enhanced by previous industry success that lead to not listening to more rational voices. Elon Musk type?
I donât know anything about the bikes but they look cool enough to me and I did get a âdesign-yâ vibe from the brand. Iâm not in the market for anything old this though so canât speak to the value or real practicality of the design or business.
I enjoyed the article though. Definitely saved it for a âwhat not to doâ reference.
I donât know enough about EU motorcycle culture, but I see why their value proposition would not fly in the US. I would think here the majority of the bikers are for leisure, not transportation. Iâd like to think the EU is similar, at least in the northern climes.
And while I like Starckâs Moto 6.5 for Aprilia, it was a poor seller. The âdesigner bikerâ has to be a small market of actual buyers (I like the idea of a motorcycle, I hate the reality of a motorcycle).
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Another example of âcheap moneyâ prompting companies and consumers to buy and make things that a more reasonably frugal world would not. Not dissimilar from the implosion of UX jobs.
Cake indisputably did a lot of cool things, in addition to populating most designerâs moodboards for a few years.
âInventing a market is difficultâ - great statement.
A lot of these errors could be reapplied to Peloton as well - due to the fresh content and creative resell/lease models they probably wonât go the way of Cake. A lot of the early hubris and lack of focus on the essentials of a strong business were missing from both companies.
It appears Cake really missed the emergent sweet spot in the market. In 2016, the tail end of the U.S. millennials were conditioned to think that E-bikes were available in big cities like NYC, SF, LA, CHI and BOST through bike sharing programs sponsored by big corps like Citibank, Blue Cross Blue Shield et al. Likewise in Europe, it was Velib in Paris, Santander in London, Bicing in Barcelona et al. Twenty-somethings were not taught to associate riding an E-bike with ownership. It was so easy to use your phone to get the ride you needed from the on-demand infrastructure that was already in place.
The GenZers first day on campus was 2019. Rather than target their cash at expensive E-bike ownership, they followed onto the E-bike craze that their older cohorts were pioneering, but chose to build their identity in a different way. They chose to continue the sharing model, but with E-scooters instead. The e-scooter market effectively shut down the growth of the E-bike market from 2020 on. Scooters are much more affordable and utilitarian in urban and campus environments.
If Cake had designed and developed an E-scooter as part of their product offering, they would likely still be around. Big error in business modeling.
Iâm really surprised to see some of the numbers put forward here (they only sold 6,000 units in their entire history?!), but what shocked me the most was seeing how the author - and apparently the company as a whole - viewed the definition of design.
It is quite clear from his writing that design at Cake simply meant styling and aesthetics. This is an utter failure on the part of Stefan Ytterborn, who it would seem from this account was either unable or uninterested in wielding design as the holistic problem-solving tool we know it can be. I genuinely would have thought more of the person who founded POC.
Itâs somewhat understandable, if annoying, for the business school grads of the world to see design in this narrow light, but I canât tell you how many times Iâve heard, read, or experienced firsthand this same lack of vision from other designers who think their jobs start and end at âmaking things look cool.â
We all sit here and wonder why design thinking is now a taboo phrase in the business world or why weâre losing our seats at the C-suite table? Itâs because the most prominent designers in the world are doing this. We have to be better.
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Nailed it.
And yeah those sales numbers and mismatch to projections are just⌠whoosh. Almost like the founders wanted to create a brand and product that wouldnât have a chance of surviving long-term, while getting a decent payout as founders⌠hmmm.
The âblame designâ here is entirely myopic. Yes, if design is the only player at the table, you stand a good chance of failure. But you can substitute any of the players at the C-suite table and get the same results. If finance is the only player at the table, you stand a good chance of failure. If manufacturing is the only player at the table, you stand a good chance of failure. Etc.
Why this company couldnât see the forest through the trees? I certainly donât know. The author of the article certainly didnât articulate the why. I wouldnât hire that guy either.
I think the author makes a pretty robust argument that design, regardless of how myopically they may or may not view it, was not the only thing that lead to the failure of Cake. They point out a number of issues, in and out of the companyâs control, that led to the companyâs bankruptcy.
That said, my comment was not necessarily âblame designâ but more an expression of shock that at even the highest levels of a company led by someone like Stefan Ytterborn - a designer that many at the time considered to be one of the most prominent leaders in championing holistic design thinking and process as a recipe for commercial success - there was still a pervasive attitude of design versus engineering, styling versus reality.
Who knows where the failure truly lies with regard to the product itself, but a brand and business is much more than just a product. Given Stefanâs position of power and influence over Cakeâs strategy, values, and processes it is reasonable to say this was an absolute failure of design leadership.
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The insistence on having all custom-made parts, and the lack of a viable service loop for repair or replacement of those custom parts, constitutes in my mind a failure or abdication of design leadership. They could have chose to make one or two less SKUs, and focused those resources on building out a customer journey to slowly build respect and a good reputation. Naaaah - they chose bright shiny objects.
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Again, I would characterize it as a failure of leadership. Having a design background is irrelevant.
And again, the exact details of this story were left out in the article. Sure, some âdesignâ battles are worth fighting, others, not. But there is no way to discern from the article whether was an insistence to win every design battle or not. Speculation is no better than a crystal ball, which entirely failed me on the 1.2B lottery the other night. 
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Yeah thatâs right. âLeadersâ donât assign blame to departments.
I was going to post this to electric cars, but it might fit better here.
Quebec electric snowmobile maker Taiga suspends production, lays off 70 workers
It says its net loss was $72.5 million in 2023, compared to a loss of $59.5 million in 2022.
Taiga says it wants to better align vehicle production with seasonal demand and reduce operating costs.
Iâm on a university start-up email list and I hope they stop promoting talks with the founder. How they managed to raise money to go after an incredibly niche product category is beyond me.
Thatâs the fundraising game, unfortunately. It mostly lives at the intersection of blind overconfidence and dangerous ignorance.
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