Rock-It may be emblematic of a shift in the industry away from urban cores, toward working outside of standard business hours, and toward delivering things other than documents and small packages. But they are far from the first service to go the route of on-demand delivery of convenience items by bicycle.
Kozmo.com arrived on the scene first in New York City in 1998, delivering DVDs, candy bars and other random goods first for free, and then for a $1 delivery charge. Porn addicts and junk food lovers in eleven U.S. markets rejoiced. According to a May 2012 Slate Magazine article, the company had raised $232.3 million in just its first two years from private investors who saw dollar signs in the brave new world of e-commerce and its inevitable intersection with legions of lazy urbanites. But Kozmo bit off more than its young teeth could chew. The company saw losses of $26.4 million in 1999, according to the Slate article—in a year that saw only $3.5 million in incoming funds. Ouch.
Vernon Schleyer is a lawyer who worked for them as a bike messenger in Chicago in 2000 and says that it wasn’t the idea that was flawed, or even its timing. What did them in, Schleyer insists, was a fatal cocktail of over-staffing, over-expansion, ineffective advertising, reckless spending and a failure to understand the young, net-savvy demographics that constituted its client base. “Kozmo decided that they needed to be ready for any sudden increase in business, so they would have a spoke—their term for a warehouse—absolutely stuffed with people,” Schleyer said. “We would have sometimes as many as fifteen bicycle riders, two delivery drivers, two dispatchers, four order pickers, two front desk people, a bicycle mechanic and three managers working per shift. The first five or six months rarely if ever saw more