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🫡 The untold story behind Mio's strategic shutdown
Why Mio shut down despite having 1.5 years of runway (huge respect to the founders)
Admond Lee
October 13, 2024
Hey Founders,
Welcome to The Runway Ventures — a weekly newsletter where I deep dive into failed startup stories to help you become the top 1% founder by learning from their mistakes with actionable insights.
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Crazy. It was a huge leverage of my time.
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Today’s story is about a Vietnamese’s social commerce startup that died (but did the right thing). Let’s get to it! 🚀
Today at a Glance:
☠️ 1 Failed Startup → Mio
⚠️ 2 Mistakes → Unit economics didn’t make sense
🧠 3 Lessons Learned → Adapt quickly and be ready to pivot
🔗 The Runway Insights → Replit’s path to product-market fit — the $1 billion side project
💰 Southeast Asia Funding Radar → WatchTowr raises $19M Series A led by Peak XV to make sure companies don’t get hacked
☠️ 1 Failed Startup: Mio
🚀 The Rise of Mio
Mio was founded in 2020 by Trung Huynh, An Pham, Tu Le, and Long Pham to revolutionise how people shop for fresh produce in Tier 2 and 3 cities of Vietnam.
🥬 Mio was inspired by Trung’s mum
Mio was born from Trung's observation of his mother's unique grocery shopping habits — she preferred buying from a trusted neighbour rather than a supermarket.
💡 This sparked an idea
Why not create a platform that harnesses the power of community and technology to deliver fresh produce directly from farms to consumers?
The Problem — 🇻🇳 Rural Vietnamese women in Tier 2 and 3 cities of Vietnam struggled to access quality groceries, where traditional supermarkets were often out of reach.
The Solution — 🙌🏻 Mio empowers women in Vietnam’s underserved Tier 2 and 3 cities by enabling them to sell fresh produce through a social commerce platform.
At its core, Mio helped housewives and stay-at-home moms to become micro-entrepreneurs by selling fruits, vegetables, and other fresh groceries sourced directly from farms.
They even promised next-day delivery, thanks to their robust logistics infrastructure.
In short, Mio was a group-buying platform for groceries and fresh produce.
 | ✅ Mio solved 2 major problems by:
|
💰 Within just a year, Mio had raised $9 million in funding, including the $8 million in Series A led by Jungle Ventures. They achieved a staggering 50x growth in gross merchandise value (GMV), fulfilling over 10,000 orders per day across several cities like Ho Chi Minh City and Binh Duong.
🤝🏻 At its peak, Mio was celebrated as one of the fastest-growing social commerce platforms in Vietnam, creating thousands of jobs for women through their reseller model called Mio Partners — a win-win situation that empowered local communities while driving business growth.
📉 The Fall of Mio
While we improved internal operations through technology, the core challenge remained on the supply side. Given the scale of this issue, we decided against another pivot and chose to shut down instead.
However, as Mio scaled, cracks started to show. In October 2024, Mio suddenly announced that they were shutting down due to scaling challenges, shifting market conditions, and a funding winter during tough economic times.
🤔 But Trung later clarified that this shutdown was a strategic move rather than a forced exit due to financial struggles.
📌 Here’s what happened to Mio:
Jun 2020 — Mio was founded by Trung Huynh and his team.
May 2021 — 💰 Raised $1M in seed funding co-led by Venturra Discovery and Golden Gate Ventures.
Rapidly expands its logistics infrastructure, focusing on next-day delivery of fresh produce from farms to customers in Tier 2 and 3 cities.
Jan 2022 — 💰 Raised $8M in Series A funding led by Jungle Ventures to expand logistics and fulfilment capabilities as well as enter new regions.
Achieved 10,000 orders per day.
Built a robust network of resellers (mostly women), operating across multiple provinces.
⚠️ However, the rapid expansion led to operational inefficiencies and high costs, especially in logistics and marketing.
The role of agents appointed by Mio was diluted due to the change in post-pandemic behaviour when customers started returning to supermarkets.
Its business model wasn’t sustainable (losing money) and in order for it to scale to other cities, it needed funding.
But Mio struggled to secure additional funding due to the tough economic times.
In short, things didn’t look good. Mio had to decide if it wanted to continue on this path or find an effective pivot.
Late 2023 — 🥩 In the end, Mio pivoted to focus on meat products for better margins and retention.
Mio wanted to move away from other fresh produce categories that were not yielding favourable margins.
💪🏻 It also moved from a B2B2C model (relying on agents) to a B2B model targeting retailers.
The B2B2C model became saturated as many competitors were offering agents higher margins and commissions.
However, Mio still struggled to hit PMF, so the company significantly scaled down operations, cut product lines and reduced staff.
⚠️ Due to the pivot, Mio moved away from its original mission of empowering women resellers via its social commerce-driven fresh product platform — and investors didn’t like the new model 🤐
Oct 2024 — ⚰️ Mio officially shut down its operations even though it has at least 1.5 years of runway because:
It couldn’t maintain its momentum after it pivoted to focus exclusively on the meat sector.
Unit economics didn’t make sense (unsustainable business model).
Difficult to raise from investors due to the market conditions.
Mio’s closure, however, was a strategic decision, not a forced shutdown due to lack of funds.
Despite having great traction in empowering local communities and disrupting traditional grocery shopping, it was extremely hard to survive and thrive in a volatile market.
🙏🏻 In the end, the founders made the strategic decision to shut down Mio even though they had enough funds to sustain for another 1.5 years. The rationale was that without a substantial capital infusion, Mio might still not be able to make it in the end. So they returned the remaining funds to their investors instead to ensure a fair outcome for everyone involved.
🫡 Huge respect to the founders.
Want to learn more about Mio’s downfall?
⚠️ 2 Mistakes
Mistake 1: Unit economics didn’t make sense
Before and after the pivot, Mio faced the same issue — the unit economics didn’t make sense as they didn’t have control over the supply side.
For example, as shared by Trung in the interview with e27 (after pivoting to the meat sector):
They realised that without owning farms or suppliers, they lacked the bargaining power and vertical integration necessary to optimise unit economics.
Owning farms would have been essential to securing better margins and stable supply, but it required substantial capital and time investments.
While they improved internal operations through technology, the core challenge remained on the supply side.
Given the scale of this issue, they decided against another pivot and chose to shut down instead.
🙏🏻 In short, Mio’s business model relied on economies of scale. Without sufficient capital, it couldn’t scale to optimise its cost and get to profitability. Closing down is probably the best alternative for every stakeholder — maybe.
Mistake 2: Scaled too fast, pivoted too slow
During the post-pandemic period (customers started returning back to supermarkets), Mio’s rapid expansion backfired as it led to operational inefficiencies due to competition, regulatory compliance, logistics, marketing, and tough market conditions.
It took Mio 2 years before the founders realised the current model didn’t work and had to pivot to the meat sector.
Had the founders pivoted earlier, would Mio be at a very different stage today? Honestly, I don’t know. But timing matters when building a startup, especially when it comes to raising funds from investors.
⏳ If Mio pivoted during the good times and positive investors’ sentiments in the space, maybe Mio could have raised more capital to allow them to fix and own the supply side, giving them better unit economics. Maybe.
🧠 3 Lessons Learned
Lesson 1: Know your margins
From the beginning, Mio faced an uphill battle with its unit economics. By not owning the supply chain, they lacked control over costs, which ultimately meant their margins were razor-thin, even after a pivot to meat products.
🌟 Key Takeaways:
🤑 Understand Your Costs and Margins
Before scaling, make sure your unit economics work.
Calculate your costs down to the tiniest detail.
Ask yourself, “Will this still be profitable at 10x scale?”
If not, it's time to rethink your model before expanding.
For example, Warby Parker disrupted the eyewear market.
They focused on vertical integration by controlling their supply chain, from manufacturing to retail.
This allowed them to offer high-quality glasses at competitive prices while maintaining healthy margins.
Lesson 2: Adapt quickly and be ready to pivot
Mio expanded rapidly but took too long to pivot when market conditions changed. They waited two years after realising their initial model was no longer viable, missing crucial opportunities for adjustment.
🌟 Key Takeaways:
⏰ Timing is important
Recognizing shifts in consumer behavior and market conditions early is crucial for survival.
Don’t wait. If you wait too long, competitors or changing circumstances will overtake you, and you’ll die.
Don’t get too attached to your original model if the market or customer needs are changing. Pivoting isn't a sign of failure — it's a necessary move when you're no longer on the right path.
Slack began as a gaming company called Glitch, but when they noticed their internal communication tool was gaining more interest, they pivoted.
The quick shift turned Slack into the powerhouse we know today.
Lesson 3: Doing the right thing builds trust
Even with 1.5 years of runway left, Mio made the tough decision to shut down and return the remaining funds to investors.
🫡 Trung Huynh and his team chose to act responsibly, ensuring that everyone — from investors to employees — was treated fairly. This decision wasn’t forced by a lack of funds but came from a place of integrity and transparency, earning the respect of their investors.
🌟 Key Takeaways:
🤝🏻 Do the right things
In tough times, doing the right thing, no matter how difficult, can go a long way in maintaining trust and relationships.
Being transparent with investors and stakeholders when things aren’t working, instead of hiding the reality, preserves your reputation for the long term.
Remember — trust is one of the most valuable currencies in the startup world.
🔗 The Runway Insights
💰 Southeast Asia Funding Radar
WatchTowr raises $19M Series A led by Peak XV to make sure companies don’t get hacked (Link)
Ouch! raises $1.2M led by PPB Ventures to make “takaful” insurance simple (Link)
Surfin raises $12.5M from Insignia Ventures Partners to serve the underserved middle class (Link)
Earlybird AI secures Antler-led funding to simplify finance admin for SMEs (Link)
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That’s all for today
Thanks for reading. I hope you enjoyed today's issue. More than that, I hope you’ve learned some actionable tips to build and grow your business.
You can always write to me by simply replying to this newsletter and we can chat.
See you again next week.
- Admond
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