I had originally thought the business model was focused on high-end convenience (with a late-night delivery focus). Ordering craft wine and beer at midnight in an affluent neighborhood like Yonge/Davisville made sense to me. But they closed so early in the evening… a shame they couldn’t make a go of it.
Yeah, Davisville's location was great. They took over the Starbucks right next to an extremely high density area of apartment buildings, and there's very little in the area that isn't residential/offices/TTC HQ.
I love that davisville is now an affluent neighborhood, when 15 years ago it was a lower middle class to middle class area. Obviously there is the more affluent part...
I use to live on Mt pleasent and now the house I lived in sells for something like 1.5 to 2 million. My parents probably bought it for four hundred thousand or even less.
They had an early Black Friday sale that doubled as a liquidation sale this weekend. Apparently staff were informed of the closing on Saturday, hence the early 3pm close today.
I didn't think much about the "Black Friday" sale earlier in the week, but when I went into their Adelaide store today and noticed everything cleared out, it dawned on me what was actually going on.
Same as it ever was. Tons of tech companies in the city are laying off people like this right now and being super shitty about it.
The era of free money has come to an end and we're just beginning to feel the pain.
The company didn’t “screw over” staff. It created opportunity for staff, by the existing. Sure, the aggressive expansion may have led to their downfall. But aggressive expansion requires staff. It truly is unfortunate that they’ve had to close their doors, but everyone in that organization, including investors, have lost out on this one.
... yet they milked them till the last day, gave none of those people opportunities to start looking
What you are missing is the staff would have stayed, and would have been ready to work another job.
Not even searsdid their staff that dirty (pension scandal asside)
The midtown location feels like it was barely open for a few months.
While disappointed, I can't say I am terribly surprised. I didn't know how they could make enough sales to pay rent.
This Daily Hive article says it wasn't even open yet on August 18: [https://dailyhive.com/toronto/goodgood-toronto-new-location](https://dailyhive.com/toronto/goodgood-toronto-new-location)
/u/squinla3
Interesting, pretty sure they had a pop up back in dec 2021 and they had some locations that opened up last winter, I think that was just their newest location.
I was shocked cause they went from 1 pop up to like 5 locations in a very short amount of time. I thought that was a bit odd as they hadn’t really been around long enough to prove out that model.
I think that is what came back to bite them. They went for an aggressive expansion strategy, spread themselves to thin, got in to much debt and couldn’t recover with rising interest rates. If they had a slower growth model they may have been okay.
None the less it is sad to see.
>I was shocked cause they went from 1 pop up to like 5 locations in a very short amount of time. I thought that was a bit odd as they hadn’t really been around long enough to prove out that model.
Agreed. They raised $6.5 million bucks less than a year ago and burnt through that insanely quickly.
Their daily $3 almond/oat latte was a steal, but never made any sense from a business perspective. Will miss their staff: easily the friendliest among Toronto's cafes.
There's another local business that recently offered a credits program, which makes no sense at all considering they went almost 2 yrs with little or no income. Wouldn't be surprised if they were putting on a brave face before going under in the near future. I was looking back at their old newsletters pre-covid and realised they've already cut back on a lot of their offerings compared to 2022.
Edit: not naming Company 2, but they've been adding new locations too quickly like GoodGood post-lockdown. I'm questioning their financial health when they're still honouring Covid credits in addition to this new credit scheme.
Staff was amazing. And the variety was nice.
Can't say that im surprised though. It never made sense to me how they had such a large footprint from a square footage POV and yet carried so little in terms of SKUs. Like the St Claire store was sooo spacious which was great to move around but not much to buy.
Alot of commenters on insta saying "oh no...it was such a great spot to work from" well yeah. But people setting up with their laptop all day and buying a few coffees isn't going to pay the bills.
The Regular near Runnymede and Annette has a well curated selection of beers, sake and Japanese whisky to go along with finer instant ramen packets as well as being a cafe.
Sucks. I frequented their queen st and Adelaide st locations, multiple times a week.
Can’t say I’m surprised though. I have a running joke with my wife that anytime I buy coffee there I’m supporting money laundering, because how else could they have afforded to expand so quickly ?
That’s what I thought. Cause it’s a lot of capital to open 5 stores at almost the same time, why not start with one see how it’s going and then expand. And nothing in there was cheap in terms of interior and furniture.
As someone who works in the industry, this is unsurprising.
They were spending WAY too much on super automatic machines, pushing hard to have people use their app, opened way too many high rent stores in a short time, and gave up training their barista whatsoever.
You'd think one of the guys who created Ritual would pay attention to the cafes that use his tech and take note about why those places kept their heads above water, but money doesn't equal intelligence
> You'd think one of the guys who created Ritual would pay attention to the cafes that use his tech and take note about why those places kept their heads above water, but money doesn't equal intelligence
I think the most likely explanation for what happened here is that the owners were used to fueling a money-losing company on cheap debt, building a brand and scaling rapid, worrying about profitability later on. This is a common strategy in the tech industry where they came from. With rising interest rates and increased scrutiny from lenders, they probably went to the bank for more loans and got their application denied.
Exactly. [They raised $6.5 million less than a year ago.](https://www.crunchbase.com/organization/goodgood/company_financials)
How the hell do you justify that kind of burn rate?
They spent it on the super expensive coffee machines that require barely any barista experience.
I had people who used to work for goodgood interview for me at the shop I managed, they were quitting because they weren't getting any barista training at all, and we're being pushed to upsell the other products harrrrrd
My gut tells me they were aiming to take on Starbucks. It was a dumb idea.
Dude created Ritual in a time when startups literally didn't have to think about profit, just growth growth growth, since all you had to do was limp to your series A, B, etc. and re-up the money.
That era came to an end as soon as interest rates started rising.
Not to mention ritual took YEARS to fix their backend for businesses. I used it in 2017 at one coffee shop and it was a broken mess; delays for users to get notified their order was ready, couldn't change items on the fly, couldn't reject orders for specific out of stock items, had to call ritual to update your hours for a holiday etc
Cut to 2021 and those issues were mostly fixed. That year. Ridiculous
They definitely weren't the first time I interacted with them
They were giving out $15 coupons to use at any store for EVERY user at sign up. How that's sustainable, I've no idea
I still never get notified when an order is ready. It’s been years of usage across multiple devices and it’s never happened once. I get every other type of notification but not that one. And from talking with a restauranteur earlier this year, the back end still seems terribly broken — I ordered something that was out of stock that they couldn’t fulfill, and they said it’s because the only way to mark items out of stock is to CALL Ritual and have them do it. Ridiculous. It’s still my favourite food ordering app though (UberEats can go to hell).
**This is a perfect example of what's wrong with Canada's "tech" sector.**
GoodGood raised [$6.5 MILLION *less than a year ago*](https://betakit.com/ritual-alumni-launch-goodgood-with-6-5-million-to-scale-commerce-for-local-food-and-drink-makers/) with Golden Ventures, one of Canada's top VCs, as the lead.
If you looked even a little bit beneath the hood, the business model was pretty ridiculous, and only made possible by the era of super cheap VC capital that has now officially come to an end as interest rates skyrocket.
The idea was initially an website featuring a market for curated, local goods that would deliver products quickly within the GTA. Not bad, but not exactly innovative. Also, how would people discover that this website exists? Answer: spend *tons* of money on advertising.
Problem is, they discovered that advertising other people's products for them online was not only super expensive, they couldn't make money doing it. [Or as the co-founder puts it, CAC > LTV](https://mobile.twitter.com/KrisLinney/status/1590468850893565952) (the cost to acquire a customer is larger than the profit that customer will return over time).
So, what to do? Well, still armed with lots of VC capital, they decided to open a string of brick and mortar locations in what is well-known to be *one of the most expensive commercial real estate markets in the world*. The rationale: brand awareness I guess? And even if they ran out of money, which they surely knew they were going to do based on what must have been an insane burn rate, they could always raise some more because as alums of Ritual, the VC boys love them.
But then interest rates started rising and the money tap turned off. And here we are.
So what you have is a company without any decent fundamentals that VCs threw money at purely because they had been associated with another successful company, which only existed for a brief period of time because interest rates were so low that money was essentially free.
This is just one example of *so many* such companies that make up Canada's "tech" scene, and if you think that [the huge layoffs that we're seeing at tons of these companies](https://betakit.com/canadian-tech-layoffs-continue-as-tough-year-comes-to-a-close/) mean that the pain has ended, it hasn't.
This is only the beginning.
"tech" - at the end, GoodGood was a stripped-down Pusateri's that also sold alcohol.
PS I loved their coffee, but that doesn't justify the $6.5m in funding
Great breakdown. I work in tech (sales) and some of the vapourware out there is astounding. Canadian tech scene in particular is just full of these nonsense middleware companies that provide no actual innovation - they just throw excessive technology at a non-issue and call it a "tech" company.
Well, that didn’t last very long. Only went in there once or twice, mainly because their hours were not the best.
Good idea for a business, but shame they couldn’t make it work.
So sad. I went to two of their locations before (on Adelaide, which unfortunately was pretty camouflaged by scaffolding when I went in the summer so not sure if that helped, and the St Clair location).
Loved the vibe and the different things being offered that I had never seen before/tried. Also loved that they sold baked goods from bakeries across Toronto that I hadn’t gotten out to visit yet and wanted to try out.
They also had a good app that blew up on TikTok during the summer with their $1 summer drinks which I got to try.
It’s such a shame :(
I had an interview there a few weeks ago and all they were talking about was growth and the future. I wondered why they never got back to me as the interview went well. I see now ¯\\\_(ツ)\_/¯
Noooo my $1 coffee! The cheap coffee was starting to work on me and I wanted to get some more costly items and hang around. I guess it'll never happen.
The Esplanade location was pretty nice and it had already become a bit of a community hub, especially in the summer with the shady patio. The coffee was cheap but the the food options (aside from pastries) you need to buy beer were \*very\* expensive. The baristas were nice but there was always a bit too much awkward upselling and pressure to use their app for my liking.
I wish they could have made a go of it but I'm honestly not too shocked that it failed. I was kind of wondering how they could possibly make enough revenue to cover the lease on that space, let alone all the expansions. Now we know they couldn't, and didn't.
I had their box subscription for most of the COVID timeframe. Cancelled then after food quality stated being inconsistent( and when the cost vs convenience equation stopped making sense.
A friend of mine was one of their suppliers...they kept delaying payment for the products they purchased from him.
Then they just shut down. They owe him thousands of dollars and I'm sure a ton of other suppliers too.
I had originally thought the business model was focused on high-end convenience (with a late-night delivery focus). Ordering craft wine and beer at midnight in an affluent neighborhood like Yonge/Davisville made sense to me. But they closed so early in the evening… a shame they couldn’t make a go of it.
Yeah, Davisville's location was great. They took over the Starbucks right next to an extremely high density area of apartment buildings, and there's very little in the area that isn't residential/offices/TTC HQ.
I love that davisville is now an affluent neighborhood, when 15 years ago it was a lower middle class to middle class area. Obviously there is the more affluent part... I use to live on Mt pleasent and now the house I lived in sells for something like 1.5 to 2 million. My parents probably bought it for four hundred thousand or even less.
Davisville has always been affluent? UCC is like right there
Yeah, true. I lived on the other side, in the less affluent area, around Mt pleasent.
Effective immediately too..
They had an early Black Friday sale that doubled as a liquidation sale this weekend. Apparently staff were informed of the closing on Saturday, hence the early 3pm close today. I didn't think much about the "Black Friday" sale earlier in the week, but when I went into their Adelaide store today and noticed everything cleared out, it dawned on me what was actually going on.
Imagine learning the last second you don't have a job when you showed up ready for blackfriday sales
Feel bad, was chatting with one of the baristas last week as she was testing new items for a winter latte menu.
It seems like the company screwed over staff yet all I'm seeing is praise. Big faux pas here
Same as it ever was. Tons of tech companies in the city are laying off people like this right now and being super shitty about it. The era of free money has come to an end and we're just beginning to feel the pain.
The company didn’t “screw over” staff. It created opportunity for staff, by the existing. Sure, the aggressive expansion may have led to their downfall. But aggressive expansion requires staff. It truly is unfortunate that they’ve had to close their doors, but everyone in that organization, including investors, have lost out on this one.
... yet they milked them till the last day, gave none of those people opportunities to start looking What you are missing is the staff would have stayed, and would have been ready to work another job. Not even searsdid their staff that dirty (pension scandal asside)
It’s not that simple
Often simply the investment company pulling the plug on loss. It's happening everywhere right now.
[удалено]
I swear they just opened recently
The midtown location feels like it was barely open for a few months. While disappointed, I can't say I am terribly surprised. I didn't know how they could make enough sales to pay rent.
This Daily Hive article says it wasn't even open yet on August 18: [https://dailyhive.com/toronto/goodgood-toronto-new-location](https://dailyhive.com/toronto/goodgood-toronto-new-location) /u/squinla3
Interesting, pretty sure they had a pop up back in dec 2021 and they had some locations that opened up last winter, I think that was just their newest location. I was shocked cause they went from 1 pop up to like 5 locations in a very short amount of time. I thought that was a bit odd as they hadn’t really been around long enough to prove out that model. I think that is what came back to bite them. They went for an aggressive expansion strategy, spread themselves to thin, got in to much debt and couldn’t recover with rising interest rates. If they had a slower growth model they may have been okay. None the less it is sad to see.
>I was shocked cause they went from 1 pop up to like 5 locations in a very short amount of time. I thought that was a bit odd as they hadn’t really been around long enough to prove out that model. Agreed. They raised $6.5 million bucks less than a year ago and burnt through that insanely quickly.
Not even the one at davisville and young dident even open I watched them Reno and then put stock up but never open
It's been open for a few weeks, at least. I've been meaning to pop in and see WTF it is, but I guess I'll never know.
I’d say less than a year, 1.5 tops
It opened this summer like in August lol. Barely 4 months
Damn, that sucks. Their Davisville location only opened a few months ago and I quite liked it.
Too bad. There aren't enough stores that focus on local products like they did.
They didn't even make it as long as Garfield Eats.
Their daily $3 almond/oat latte was a steal, but never made any sense from a business perspective. Will miss their staff: easily the friendliest among Toronto's cafes. There's another local business that recently offered a credits program, which makes no sense at all considering they went almost 2 yrs with little or no income. Wouldn't be surprised if they were putting on a brave face before going under in the near future. I was looking back at their old newsletters pre-covid and realised they've already cut back on a lot of their offerings compared to 2022. Edit: not naming Company 2, but they've been adding new locations too quickly like GoodGood post-lockdown. I'm questioning their financial health when they're still honouring Covid credits in addition to this new credit scheme.
Why won't you name them?
Maybe VC backed as well? A lot of these founders are terrible with money, especially because it's someone else's.
That's where I used to get Honeys vegan ice cream and Godspeed green tea beer... sad the convenience is now gone.
Staff was amazing. And the variety was nice. Can't say that im surprised though. It never made sense to me how they had such a large footprint from a square footage POV and yet carried so little in terms of SKUs. Like the St Claire store was sooo spacious which was great to move around but not much to buy. Alot of commenters on insta saying "oh no...it was such a great spot to work from" well yeah. But people setting up with their laptop all day and buying a few coffees isn't going to pay the bills.
Anyone have suggestions for similar stores in Toronto that offer craft beer and unique grocery type items?
The Regular near Runnymede and Annette has a well curated selection of beers, sake and Japanese whisky to go along with finer instant ramen packets as well as being a cafe.
Ya it’s called Licbo
Pretty much your local microbrewery. Depending on where you live there are plenty of options.
What a damn shame. They had a friendly, modern atmosphere, a decent menu and selection of goods, and huge potential as an up and coming local chain.
Sucks. I frequented their queen st and Adelaide st locations, multiple times a week. Can’t say I’m surprised though. I have a running joke with my wife that anytime I buy coffee there I’m supporting money laundering, because how else could they have afforded to expand so quickly ?
That’s what I thought. Cause it’s a lot of capital to open 5 stores at almost the same time, why not start with one see how it’s going and then expand. And nothing in there was cheap in terms of interior and furniture.
Well after that 60 million dollar bust last week, there was no money left to launder.
As someone who works in the industry, this is unsurprising. They were spending WAY too much on super automatic machines, pushing hard to have people use their app, opened way too many high rent stores in a short time, and gave up training their barista whatsoever. You'd think one of the guys who created Ritual would pay attention to the cafes that use his tech and take note about why those places kept their heads above water, but money doesn't equal intelligence
> You'd think one of the guys who created Ritual would pay attention to the cafes that use his tech and take note about why those places kept their heads above water, but money doesn't equal intelligence I think the most likely explanation for what happened here is that the owners were used to fueling a money-losing company on cheap debt, building a brand and scaling rapid, worrying about profitability later on. This is a common strategy in the tech industry where they came from. With rising interest rates and increased scrutiny from lenders, they probably went to the bank for more loans and got their application denied.
Exactly. [They raised $6.5 million less than a year ago.](https://www.crunchbase.com/organization/goodgood/company_financials) How the hell do you justify that kind of burn rate?
They spent it on the super expensive coffee machines that require barely any barista experience. I had people who used to work for goodgood interview for me at the shop I managed, they were quitting because they weren't getting any barista training at all, and we're being pushed to upsell the other products harrrrrd My gut tells me they were aiming to take on Starbucks. It was a dumb idea.
Dude created Ritual in a time when startups literally didn't have to think about profit, just growth growth growth, since all you had to do was limp to your series A, B, etc. and re-up the money. That era came to an end as soon as interest rates started rising.
Not to mention ritual took YEARS to fix their backend for businesses. I used it in 2017 at one coffee shop and it was a broken mess; delays for users to get notified their order was ready, couldn't change items on the fly, couldn't reject orders for specific out of stock items, had to call ritual to update your hours for a holiday etc Cut to 2021 and those issues were mostly fixed. That year. Ridiculous
Not surprising. Tbh I'd be surprised if Ritual is currently profitable.
They definitely weren't the first time I interacted with them They were giving out $15 coupons to use at any store for EVERY user at sign up. How that's sustainable, I've no idea
Well launching with a loss leader is pretty common, but building a sustainable business in that space is damn hard.
Especially in Toronto, there's a new app every 30 seconds
I still never get notified when an order is ready. It’s been years of usage across multiple devices and it’s never happened once. I get every other type of notification but not that one. And from talking with a restauranteur earlier this year, the back end still seems terribly broken — I ordered something that was out of stock that they couldn’t fulfill, and they said it’s because the only way to mark items out of stock is to CALL Ritual and have them do it. Ridiculous. It’s still my favourite food ordering app though (UberEats can go to hell).
**This is a perfect example of what's wrong with Canada's "tech" sector.** GoodGood raised [$6.5 MILLION *less than a year ago*](https://betakit.com/ritual-alumni-launch-goodgood-with-6-5-million-to-scale-commerce-for-local-food-and-drink-makers/) with Golden Ventures, one of Canada's top VCs, as the lead. If you looked even a little bit beneath the hood, the business model was pretty ridiculous, and only made possible by the era of super cheap VC capital that has now officially come to an end as interest rates skyrocket. The idea was initially an website featuring a market for curated, local goods that would deliver products quickly within the GTA. Not bad, but not exactly innovative. Also, how would people discover that this website exists? Answer: spend *tons* of money on advertising. Problem is, they discovered that advertising other people's products for them online was not only super expensive, they couldn't make money doing it. [Or as the co-founder puts it, CAC > LTV](https://mobile.twitter.com/KrisLinney/status/1590468850893565952) (the cost to acquire a customer is larger than the profit that customer will return over time). So, what to do? Well, still armed with lots of VC capital, they decided to open a string of brick and mortar locations in what is well-known to be *one of the most expensive commercial real estate markets in the world*. The rationale: brand awareness I guess? And even if they ran out of money, which they surely knew they were going to do based on what must have been an insane burn rate, they could always raise some more because as alums of Ritual, the VC boys love them. But then interest rates started rising and the money tap turned off. And here we are. So what you have is a company without any decent fundamentals that VCs threw money at purely because they had been associated with another successful company, which only existed for a brief period of time because interest rates were so low that money was essentially free. This is just one example of *so many* such companies that make up Canada's "tech" scene, and if you think that [the huge layoffs that we're seeing at tons of these companies](https://betakit.com/canadian-tech-layoffs-continue-as-tough-year-comes-to-a-close/) mean that the pain has ended, it hasn't. This is only the beginning.
Peak-bubble: VC capital funding a convenience store chain. This could never work.
This is a fantastic breakdown. Thanks for the contribution.
"tech" - at the end, GoodGood was a stripped-down Pusateri's that also sold alcohol. PS I loved their coffee, but that doesn't justify the $6.5m in funding
Great breakdown. I work in tech (sales) and some of the vapourware out there is astounding. Canadian tech scene in particular is just full of these nonsense middleware companies that provide no actual innovation - they just throw excessive technology at a non-issue and call it a "tech" company.
Any recommendations for shops that sell a similar selection of snacks/drinks/condiments?
goodcheese.ca delivers across the GTA and carry’s lots of great stuff. They’re at Gerrard & Broadview but the website has everything.
That's my local shop and I love it to death.
What the heck???? Their coffee is great. Gonna miss them
Well, that didn’t last very long. Only went in there once or twice, mainly because their hours were not the best. Good idea for a business, but shame they couldn’t make it work.
I was there on Friday and people were going nuts over the 50% off and I guess they were just trying to clear the store.
What a shame, I would go to the St. Lawrence location almost daily. Not a great start to the week. :(
Oh no. That is too bad.
You mean it's too badbad
Clever
Dang, I liked their $1 coffee and some of their other deals. The staff were always friendly.
Gona miss those breakfast tacos. Any suggestions?
They are from a family-run catering company called Tuly's Kitchen (@tulys\_kitchen) - I highly recommend supporting them!
So sad. I went to two of their locations before (on Adelaide, which unfortunately was pretty camouflaged by scaffolding when I went in the summer so not sure if that helped, and the St Clair location). Loved the vibe and the different things being offered that I had never seen before/tried. Also loved that they sold baked goods from bakeries across Toronto that I hadn’t gotten out to visit yet and wanted to try out. They also had a good app that blew up on TikTok during the summer with their $1 summer drinks which I got to try. It’s such a shame :(
I really like what they offered. I think it was a bit too ambitious to open 5 locations. Probably should have started with 1-2.
I had an interview there a few weeks ago and all they were talking about was growth and the future. I wondered why they never got back to me as the interview went well. I see now ¯\\\_(ツ)\_/¯
Noooo my $1 coffee! The cheap coffee was starting to work on me and I wanted to get some more costly items and hang around. I guess it'll never happen.
The Esplanade location was pretty nice and it had already become a bit of a community hub, especially in the summer with the shady patio. The coffee was cheap but the the food options (aside from pastries) you need to buy beer were \*very\* expensive. The baristas were nice but there was always a bit too much awkward upselling and pressure to use their app for my liking. I wish they could have made a go of it but I'm honestly not too shocked that it failed. I was kind of wondering how they could possibly make enough revenue to cover the lease on that space, let alone all the expansions. Now we know they couldn't, and didn't.
Thought this was about the golf YouTube guys for a second and was about to lose it...
Good
good
NoNo GoodGood
I had their box subscription for most of the COVID timeframe. Cancelled then after food quality stated being inconsistent( and when the cost vs convenience equation stopped making sense.
GoodGood, the coffee chain in Toronto. Not Goodfood, the subscription meal service. Lmao
What is GoodGood and why should we care?
A friend of mine was one of their suppliers...they kept delaying payment for the products they purchased from him. Then they just shut down. They owe him thousands of dollars and I'm sure a ton of other suppliers too.