Unicorn? Reality Suggests Not, As Blippar Struggles

It's sad news breaking yesterday and this morning that Blippar is facing administration if it cannot get emergency funding lined up. Its story is typical of so many start-ups. Some cool technology, but lots of spending too. The past couple of years of headlines surrounding the company have mostly focussed on its promises to slash costs and shutter offices around the world.

I have always wondered what the long-term appeal of the technology would be. It's fun to use once or twice and have a picture in an ad come alive on the screen, but I was always left wondering whether it delivered more than just being an interesting, cool app.

For it to work, an advertiser needs to sign up and pay to ensure their ad can be turned into a "Blippable" AR experience, and consumers need to download the app. 

I have to be honest -- I have not seen an ad that it has made "Blippable" that was so great I would have been glad that I downloaded the app.

I can only imagine this friction of relying on people to download an app on the promise of seeing something they can't see now -- and so have no way of judging whether it's worth it -- has proven to be a block on adoption. That's why I suspect most of us have only ever seen the technology in use at conferences. It's cool and fun, but I've never seen it being used in the wild. 

However, it may well be the reason why a tech company -- particularly Google or Apple -- might want to buy the company's technology in a fire sale and build it in as a standard feature in the camera software their phones and tablets run on. Not having to download an app, but rather just "scan" or "Blippar" an ad, or another piece of content, for the pure fun of it could help the technology take off.

Perhaps an estate agency should buy it and transform still pictures of homes in their window into AR experiences. The same suggestion can be made for a travel company or any of the outdoor networks that want to make posters come alive.

Mind you, one would have to imagine these enquiries have already taken place and potential clients have wondered where they would get the AR content to make the experience worthwhile and whether the investment would leave people spending more or just thinking it was a cool experience. 

If you want one reason why this day of needing emergency funding or calling in the administrators was inevitable, one need look no further than comment in The Times on its annual accounts. The business brought in GBP5.7m but spent GBP34.5m, and this was at the same time that it was constantly promising to keep a lid on expenditure. For a business dreamed up eight years ago, that doesn't sound like a huge amount of income, does it? Certainly not when compared to the outgoings.

And so it came to pass that a company which once claimed an unnamed third party had offered more than a billion dollars to buy it is now days away from calling in the administrators for the sake of a handful of millions in emergency funding. However, cool your technology if it only earns half a dozen million pounds worth of business, and your expenditure is nearly six times that -- there really is only so long that funding will last and you end up running out of runway. 

Emergency funding will be a challenge when the business is burning cash at a high rate compared to income, and so Blippar's main hope has to be that its technology appeals to a tech giant.

As for talk of being a tech unicorn, that is as imaginary a title as the mythical horned beast itself. 

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