The on-demand childcare startup, Poppy recently announced that it was shutting down. In a detailed note on its website, Avni and the Poppy team posted:

We have hard news to share today – Poppy will be discontinuing services as of December 4, 2018.

Since 2015, we’ve been passionately focused on creating a platform that could serve our mission of building the modern village. In many important ways, we were tremendously successful in bringing the original mission and intent to life. Turns out it IS possible to build a delightful, trustworthy, and convenient experience connecting caregivers and families. The challenge has been the underlying business model that would enable such a community of families and caregivers to grow at scale. While there are many important complexities, it really boils down to the core economics of what it costs to deliver this end-to-end experience.

This writing has been on the wall for some time – families have been pushing for lower-priced tiers, and caregivers are constantly moving on to pursue higher-paying opportunities. Despite that, Poppy has continued to experiment as much as possible to find a viable option for maintaining this model. However, after 3+ years of this dedicated experimentation, it is evident that the cost of creating this type of product is beyond what families are willing or able to pay.

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We’re heartbroken that our journey ends here, but we’re committed to ensuring our incredible families and caregivers can connect so they can continue working together.

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I wish that Poppy could have been the solution we all dreamed it could and needed to be. But understanding that it can’t, we are sharing this hard news with you as candidly as we can, with as much help as we can provide.

 

According to GeekWire,

Poppy tried to differentiate itself from other online childcare services by helping facilitate matches with a more hands-on approach in a “managed marketplace” versus “open marketplace” competitors such as UrbanSitter or Sittercity — and Seattle-based pet sitting juggernaut Rover — that let supply and demand find each other organically.

“The economics weren’t sustainable to not only continue, but to scale, which is important for us as a venture-backed company,” Patel Thompson said in a phone interview.  Poppy raised money from angel investors, Madrona Venture Group, and Y Combinator, the famed Silicon Valley accelerator that accepted Poppy as part of a cohort in 2016.