How Much Money Has Dixie Cups Made
In 1907, Boston attorney Lawrence Luellen created a cup. It wasn't fabricated of glass or metallic—the norm at the time. Instead, it was made of newspaper so it could be thrown away afterwards use. While not earth-shattering in our current context, in the early 1900s there were no dispensable paper tissues or newspaper towels. A loving cup made of paper was a novel thought, one with a noble goal: Luellen hoped his paper cups could assistance stop the spread of affliction.
What makes this century-sometime startup story specially poignant today is that Dixie cups, as they came to be known, achieved only moderate growth for 10 years until the Spanish flu of 1918 made disposable cups a necessity and helped the Dixie cup get a household name. In 2012, Smithsonian Magazine even called the Dixie cup a "life-saving technology" that helped stop the spread of disease.
Before the Castilian influenza hit, the company backside Dixie cups was a scrappy startup. Simply simply as we've seen with the teleconferencing phenom Zoom in the COVID-19 era, Dixie cups shot to popularity with the arrival of a major wellness crisis. That'south why the Dixie loving cup'south story is instructive for startups struggling to make ends meet during the COVID-19 pandemic. Embedded in the history of Dixie cups are of import lessons for how startups can scale when times are good—and survive when times are hard.
When timing isn't right, survive until information technology is
Every bit whatever VC will tell you, timing is one of the crucial stars that must align for a startup to succeed. But what if timing isn't right for a startup?
Chances are, timing won't exist exactly correct. To succeed, yous must survive until it is.
When Luellen invented the newspaper cup, which he originally named the "Health Kup," the timing wasn't great either. Communal metal drinking cups known every bit "tin dippers" were commonplace. A single "tin dipper" could be shared by hundreds of different people. If that sounds gross, it was. But scientists were only just offset to understand how contamination was spread. Every bit a upshot, when Luellen and his cofounder Hugh Moore went to market with their paper cups, the product didn't wing off the shelves. Information technology'southward difficult to sell a solution to a problem people don't know they take.
Get a B2B or B2BC business organization
Educating a market takes fourth dimension and money, two especially scarce resources for a startup. When sensation is the trouble, targeting business customers can make the educational procedure less daunting. While sales cycles might be longer, lodge sizes are significantly larger and more than predictable.
When Dixie cups originally failed to resonate with consumers, Luellen and Moore refocused their efforts on businesses. They developed a complimentary-standing dispenser that was sold to businesses, which could sell a Dixie cup of water for a penny. One time a business bought a dispenser, Luellen and Moore could depend on revenue from the repurchase of cups. This helped the company survive during what was a slow period of adoption. It as well introduced Dixie cups to thousands of workers who would soon begin buying them in stores for home utilize.
Meet the moment
One of the virtually important skills for any startup is the ability to adapt. As we've seen in the nigh farthermost case with COVID-nineteen, factors completely out of a startup's control tin can reverse its fortunes, for improve or for worse.
Fifty-fifty the lucky ones whose products are perfectly suited for quarantine life have no guarantee that people will take notice. House Party, the group video app launched four years ago, was on its mode to condign a gaming app when COVID-19 hit. It adapted its value prop to encounter the moment, launched an advertising campaign—"Exist together when you're not together"—and signed up 50 million users in i month. When current events modify the narrative, consider how your company story fits the new reality and make sure people know almost it.
Dixie cups faced a similar situation when the Spanish influenza tore through the U.S. in 1918. All of a sudden, drinking out of a disposable cup became a affair of life and death. In response, Luellen and Moore launched an ad campaign to drive the point habitation and rebranded from the Health Kup to the more memorable Dixie cup in 1919.
"No matter how clean it may look, the soda drinking glass is a common carrier of affliction," 1 1920 ad read. "Uncounted lips touch it. Uncounted germs cluster and breed upon its rim—the germs of influenza, pneumonia, diphtheria, and worse."
As sensation of the wellness risks grew, more than states besides banned the utilize of "tin dippers," and this fabricated Dixie cups even more popular. COVID-19 may have a similar touch on telehealth startups. Already payers have significantly expanded coverage for telemedicine, HIPAA requirements have been relaxed, and some states have lifted country licensure requirements.
Evolve your message
I lingering question is if those startups made essential during the pandemic will proceed growing once the pandemic passes. If remote piece of work and telehealth become as widespread as some people think, those startups volition see increased contest and pressure to differentiate beyond what set them autonomously originally.
That'south what happened to Dixie cups. As the popularity of dispensable cups grew, copycats entered the marketplace, leading Dixie cups to find novel applications, such as "Ice Cream Dixies," a frozen treat that soda fountains used to offering. The company likewise began touting other benefits across disease prevention, such equally convenience.
Feeding the innovation loop
With the success of Dixie cups came other disposable products, such as Kleenex in 1924 and paper towels in 1931. This also led to new and environmentally harmful materials such as polystyrene finding their way into consumer products.
As the history of Dixie cups shows, a product that solves one trouble can create new ones. Some people are already complaining of "Zoom fatigue," for example. Products that get pop during the current pandemic will take their own showtime- and 2d-order effects. Some of the problematic ones volition present opportunities for intrepid new startups.
Kevin Leland is CEO of Halo, an open innovation network where companies connect with scientists and startups to solve important concern challenges.
Source: https://www.fastcompany.com/90520298/how-dixie-cups-became-the-breakout-startup-of-the-1918-pandemic
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