3 Over-Hyped Companies & How To Avoid Their Mistakes

We’re talking about hype and how to use it for good in your business this month at Smartups. Unfortunately, some companies have gotten hype wrong. Let’s look at three of them and see what we can learn from their mistakes.


Cuil_logoCuil was a search engine that came out and had a rockstar launch in 2008. They claimed to have a larger index and that they were faster than Google. They even had an ex Google engineer running the show, which provided credibility to the claims. And they had already raised $33 million dollars. They got tons of press right away from the launch. They had some unique and innovative ideas. Unfortunately, as people dove into the search engine, they didn’t find the results as good as expected.

The hype turned to backlash, and, eventually, the company shut its servers down.


pownce-logo-taglineIn 2007, Pownce launched as a Twitter killer aiming to make sharing rich media easier. Pownce had a popular founder in Kevin Rose who had proven himself with the launch of Digg. Because of the popularity of their founder, they gained a lot more attention than they probably wanted as they were developing the product. They built up so much hype that invites to the free service were being sold on eBay. They eventually sold their technology to another business.


color_labsIn 2011, Color was the location-based photo sharing app that raised an incredible $41 million before launch. They offered some really amazing features for sharing photos that helped find photo locations even when there was no GPS, internet, or other service available, and then let those photos be shared with others in the immediate vicinity.

Again, at launch, they got a ton of press especially because of their incredible funding and valuation pre-launch. The press then turned on them when they couldn’t see nearby photos (because no one was using the service yet). Color shut down the app in 2012 after attempting to pivot.


How To Avoid Their Mistakes

All three of these companies didn’t live up to their hype. And often, it was because they built the hype before they were ready. This doesn’t make the hype bad. It just means you have to plan the hype a bit better and control the message. These startups let the media define who they were and didn’t give themselves any room for early failures. Most people are willing to give a startup a break if they solve that one problem the consumer has right now, but these companies didn’t put themselves into a position to get that break.

Just because these companies got hype wrong doesn’t mean every company does. There is a company whose product is likely in your pocket or on your desk right now that uses hype at a level never seen before. Ever seen people waiting in line at an Apple store for the latest product launch or seen people blow their day at work following live blogs of the latest Apple announcement? That is hype in action. The press can’t wait to write about them, and consumers can’t wait to get their hands on their products.

I mean who isn’t hyped about the iPad when watching Jony Ive talk about his latest creation? He talks about the iPad being “Magic”. And we believe him. Because he earned it.

So let’s talk next week about how hype doesn’t need to be a four-letter word with Graham Brown of United State of Indiana. At the next meetup you can learn his secrets and the secrets of how companies like Apple use hype to grow their business.

>RSVP today for Smartups “Hype is not a four-letter word” on November 18th. 

And please let us know what you think about over-hyped companies and using hype as a marketing tool in the comments.

*The Hype cycle graph is the invention of Gartner.