Segway
From Invertopedia, the encyclopedia of how things fail
Segway was a two-wheeled, self-balancing personal transporter invented by Dean Kamen and unveiled on Good Morning America in December 2001[1][5]. Venture capitalist John Doerr was quoted saying it could be bigger than the internet[5][1], and Kamen expected to sell 10,000 a week by the end of 2002[1]. It sold about 30,000 from 2001 to the end of 2007[3], and about 140,000 in all before production ended on July 15, 2020[4].
Contents
The bet
A machine that balanced itself would change how people moved through cities. Kamen said it would "do for walking what the calculator did for pad and pencil"[1], and Doerr predicted it would reach $1 billion in sales faster than any company in history[1][3]. Commuters, tourists and police would buy it, and cities would make room for it.
What happened
| Before launch | A leaked book proposal by journalist Steve Kemper, about a secret invention code-named Ginger, quotes John Doerr saying that, if Kamen got what he wanted, it would be bigger than the internet.[5] |
|---|---|
| Dec 2001 | Kamen unveils the Segway on Good Morning America.[1] |
| Nov 18, 2002 | Amazon opens consumer orders at $4,950 with a $495 deposit, for delivery from March to July 2003.[2] |
| Nov 2002 | San Francisco moves to become the first US city to ban the Segway from its sidewalks, over safety.[6] |
| 2003 | The first recall covers the first 6,000 units: riders could fall off when the battery ran out.[7] |
| Sep 14, 2006 | Segway recalls all 23,500 units shipped, because a software glitch could suddenly reverse the wheels and throw riders off. Six incidents are reported.[7] |
| End of 2007 | About 30,000 have been sold since 2001.[3] |
| 2009 | Kamen sells the company. The British buyer, Jimi Heselden, dies in a Segway accident ten months later.[4][1] |
| 2015 | Chinese rival Ninebot acquires Segway.[1] |
| Jun 2020 | Segway says the PT is under 1.5 percent of its revenue and ends production on July 15, with 21 layoffs at its Bedford, New Hampshire, plant.[1][4] |
The kill shot
It solved a problem that walking and bikes already solved, for more than the price of a used car, and the hype set a bar no scooter could clear.
Kamen planned for 10,000 a week, half a million in the first year; over the next six years the company sold about 30,000[1][3]. At $4,950[2], it cost more than a used car[1], and a 2009 list in Time put most models well above $3,000 and some at $7,000[3].
It also had nowhere to go. Some countries classed it as a road vehicle that needed a license, and others made it illegal on roads[3]. San Francisco moved to ban it from sidewalks in November 2002, before the first consumer orders were delivered[6][2].
Red flags ignored
- Hype before a product. The leaked "Ginger" proposal made it famous before anyone knew what it was[5].
- A forecast with no buyers behind it. Kamen expected 10,000 a week by the end of 2002[1], when consumer deliveries were not due to start until March 2003[2].
- Priced like a used car. $4,950 for a way to cover distances most people already walked[2][1].
- No legal place to ride. Cities and countries treated it as something to ban or license[6][3].
- Every unit recalled. Two recalls by 2006, the second covering all 23,500 machines shipped[7].
The cost
More than $100 million was reportedly spent on development[1][3]. Against a plan of half a million in the first year, about 30,000 sold in six years[1][3], and about 140,000 over nearly two decades[4].
The 2006 recall pulled back every machine shipped to that point, 23,500 of them, for a software fix[7]. By 2019 the PT was under 1.5 percent of the company's revenue[1].
The inversion
Hype sets the bar. Make sure your product can clear the bar you set, and check that there is a place, a price and a need for it before you forecast the sales.
What survived
The name and the balancing technology. Ninebot bought Segway in 2015[1], and in 2020 Segway-Ninebot claimed 70 percent of the global shared e-scooter market[4]. Segways stayed in niches: more than 150 police departments used them by 2006[7], and they are still seen in security and tourism[5].
References
- ^ “It seemed like a good idea at the time: How the Segway fell to earth”. Daily Mail (Mark Palmer) via IOL, June 25, 2020. The Good Morning America unveiling, Kamen's calculator quote and 10,000-a-week forecast, Doerr's predictions, 30,000 sold in six years, the price versus a used car, over $100 million in development, Heselden, the 2015 Ninebot deal, under 1.5 percent of revenue and the July 15 end.
- ^ “Amazon.com to sell first Segway Human Transporters”. Amazon press release, November 18, 2002. The $4,950 price, the $495 deposit and March to July 2003 deliveries.
- ^ “Segway - The 10 Biggest Tech Failures of the Last Decade”. Time (by 24/7 Wall St.), May 14, 2009. 30,000 sold from 2001 to the end of 2007, prices above $3,000 and up to $7,000, about $100 million in development, Doerr's $1 billion prediction, road-vehicle rules.
- ^ “Segway PT production to end as scooters and bikes rise”. Fortune (David Z. Morris), June 23, 2020. The July 15, 2020 end, 21 layoffs in Bedford, N.H., about 140,000 sold in all, Kamen's 2009 sale, Ninebot ownership, the 70 percent e-scooter claim.
- ^ “Quote of the day by venture capitalist John Doerr on the Segway: 'It'll be bigger than the internet'”. TechRadar (Keumars Afifi-Sabet), August 9, 2026. Doerr's quote from Steve Kemper's leaked book proposal about "Ginger", and Segway's remaining uses in security and tourism.
- ^ “Segways Banned In San Francisco”. Techdirt (Mike Masnick), November 27, 2002. San Francisco becoming the first US city to ban the Segway from sidewalks.
- ^ “Segways recalled because of software glitch”. AP via NBC News, September 14, 2006. The recall of all 23,500 units, the software glitch, six incidents, the 2003 recall of 6,000 units, more than 150 police departments.