The creators of the sleep app Loóna have made a significant change to their strategy by laying off most of their team and shifting their focus to developing a VR service. The decision was driven by several factors, including the promising opportunities in the VR/XR/AR market, the introduction of groundbreaking devices like the Apple Vision Pro and Meta* Quest 3, and the challenging landscape of the mobile marketing industry. Loóna aims to establish a new niche for itself while staying true to the principles that define the Loóna brand.
The shift in direction was prompted by changes in the mobile app market, particularly with the release of iOS 15 and its stricter privacy regulations. As a result, attracting new customers became significantly more difficult and expensive, leading to longer advertising payback periods ranging from one to two months to a year or more.
To streamline operations, Loóna downsized its team, although the specific number of employees affected was not disclosed. However, nine individuals, including the four co-founders, remained on board. Loóna generates revenue through subscriptions but has yet to achieve self-sustainability. While the company experienced some months of positive cash flow, it did not reach the break-even point throughout its timeline. Attaining profitability would have required additional investment, prompting the co-founders to pivot.
Despite the shift, Loóna’s management will continue to support the sleep app but with reduced focus, allocating approximately 20% of their efforts towards it. Meanwhile, the team is actively developing a VR service centered around breathing practices, which is scheduled for release under the same Loóna brand within the next 7-9 months.
Notably, the creators of Loóna, Sergei Gonchar, Eugene Nevgen, Andrei Yanchurevich, and Dmitry Dorin, previously worked together on MSQRD, a live video mask application. Following the acquisition of MSQRD by Facebook, the developers joined the social media giant’s team to work on implementing Spark AR technology for Instagram and Facebook. However, in 2019, they fulfilled their obligations to Facebook and embarked on their own project: a sleep-enhancing service that eventually became Loóna.
In 2021, Loóna received recognition from Apple as one of the most aesthetically pleasing iOS apps of the year. The project has attracted investments from various sources, including Elefund, Palta, Hoxton Ventures, Elefund (mentioned twice), and Natalia Vodianova. However, the total amount of investment remains undisclosed.