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Another $1 Million Crowdfunded Gadget Company Collapses (techcrunch.com)

Posted by Soulskill on from the caveat-emptor dept.

An anonymous reader writes: In 2012, a company raised over a million dollars on Indiegogo to build a robotic dragonfly. It was originally supposed to be delivered in 2013. Unfortunately for backers, the company seems to be struggling to complete the project. They haven't been able to resolve issues with the drone falling apart after just a few seconds of flight. Unless they locate investors soon, they're going to run out of funds to continue work at full force. They're in the process of uploading all design work and their knowledge base, in case they have to officially cancel the project. They say some part-time work will continue as long as funds allow. The TechCrunch article warns, "This is just the latest example of how consumers need to be more careful with crowdfunding. There are no guarantees with crowdfunding and there is more risk involved than what's advertised."

109 comments

  1. Duh... by Lumpy · · Score: 5, Insightful

    They did not even have a working prototype just a bunch of guys with an idea they had on a napkin. Only fools invest in these things.

    --
    Do not look at laser with remaining good eye.
    1. Re:Duh... by Anonymous Coward · · Score: -1

      Reminds me of the crowd funded VR Oculus Rift purchased by Facebook, everybody got screwed

    2. Re:Duh... by JaredOfEuropa · · Score: 2
      Fools such as the Air Force...

      The Indiegogo project page states the developement had begun (in at least 2012) on a $1m grant from the US Air Force

      --
      If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
    3. Re:Duh... by Midnight+Thunder · · Score: 1

      They did not even have a working prototype just a bunch of guys with an idea they had on a napkin. Only fools invest in these things.

      I think this is the really important part. You should be thinking as an investor, even if all you get out of the affair is a product.

      Even big time investors lose their money in a business, but they reduce their risk by first making sure that the company already has an element of something tangible and they also do due diligence. It is probably harder to do due diligence on sites such as Kickstarter or Indiegogo, but you do what you can and then decide whether you can afford to write-off your investment if something goes wrong. Most business don't make it through the first year, even without the owner stealing the money, so take that to heart when you set down your cash.

      --
      Jumpstart the tartan drive.
    4. Re:Duh... by west · · Score: 4, Insightful

      I think KickStarter, et al, have perhaps unintentionally blurred the lines between research, development, and order fulfillment.

      Ostensibly these organizations are supporting development, but by essentially treating projects as order fulfillment, they ignore the fact that development can fail.

      Now in this case it appears that, whether they knew it or not, people were funding research, and of course research can (and in fact usually does) fail.

      Obviously greater transparency would help, but I'm not sure that crowd-funding would survive that reality. I suspect the majority of crowd-funding participants want the feeling of actually investing/participating in development, but they don't want any of the associated risks - they just want order fulfillment.

      Personally, I'm waiting for someone like Amazon or Alibaba to optimize the order fulfillment part of they system by holding the money in escrow. The manufacturers have to get a loan based on the money held in escrow, which should be doable if (1) they have the manufacturing contracts in hand, (2) some reputation, and (3) guaranteed payment by a reputable company. Probably means there's a minimum and maximum order size, but the option of guaranteed deliverable or 100% refund would probably cause mass migration, leaving KS and others doing actual crowd-funding, with all the risks it implies.

    5. Re:Duh... by moosehooey · · Score: 3, Insightful

      But these people aren't investors. An investor has unlimited upside, so that even if a few projects fail, the ones that do succeed will make up for it. The most these project backers can get is the product they ordered. So it's all of the risk with none of the reward.

    6. Re:Duh... by Anonymous Coward · · Score: 0

      They never released the documentation proving they had that. if all you accept is a single line on a website as "proof" then I have several bridges in New York I will sell you cheap!

      This post was funded by a $22.2 Million grant from DARPA.

    7. Re:Duh... by BradMajors · · Score: 1

      Only fools invest in these things.

      Only fools call providing money through crowd funding an "investment".

    8. Re:Duh... by Anonymous Coward · · Score: 0

      Yes, duh. Investing carries a risk, news at 11.

      Of course, all investors want benefits and no risk, and whine and moan loudly when the Grim Reaper strikes back. Perhaps Daddy Govt comes and bails us out?

      > Only fools invest in these things.

      You mean: "only fools take risks"? Oh, no. Au contraire. Some risks are worth taking. You have to do your calculations, of course.

    9. Re:Duh... by loneDreamer · · Score: 4, Insightful

      Except that crowfunding has never been an "investment". You get no shares, you get no money back (certainly not more money that you put in) and the risk would be ridiculously high. It has always been about trowing a piece of disposable income for a nice idea that you would love to see realized, in the off chance it happens. ESPECIALLY if the market would never attempt such a thing. Neither the people with the dreams, nor the people that indulge in patronage deserve to be called fools.

    10. Re:Duh... by ranton · · Score: 2

      But these people aren't investors. An investor has unlimited upside, so that even if a few projects fail, the ones that do succeed will make up for it. The most these project backers can get is the product they ordered. So it's all of the risk with none of the reward.

      Kickstarter investors have unlimited upside from the vast number of products they may someday buy that may have never existed without Kickstarter. Any good purchase ends up providing more utility to the buyer than other things they could have spent their money on. Kickstarter investors are not investing in equity, they are investing in the utility gained from owning the product being invested in. Sometimes that utility will be nothing when product development fails. But as long as a reasonable number of investments succeed, the money is still well spent as long as the buyer gains enough utility from the successful products.

      --
      -- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
    11. Re:Duh... by Half-pint+HAL · · Score: 1

      Investors take risk because they feel the potential reward outweighs the risk. But traditional investors usually look for a lot more reward than 20% off retail as their reward. Would you consider it an "investment" to go to a car dealership, pay 80% of the price of a new car now, and have to way 12-24 months for something that might never be delivered? Hell, would you buy a hamburger for 80% of the normal price, with an expected delivery date of anything from a week on Tuesday until the 1st of December, with no guarantee you'd ever receive it? That's not sensible investment. Now excuse while I go and play Star Citizen (*snort*)

      --
      Got them moderator blues I blieve I walk out the do', With these mod-points I been gettin', I 'most never post no mo'
    12. Re:Duh... by tomhath · · Score: 4, Informative

      Not really. Oculus VR had a working prototype before they launched their kickstarter. These guys raised money based on vapor.

    13. Re: Duh... by jordanjay29 · · Score: 1

      How is a product supposed to be developed and manufactured when the owners don't have the money they raised from the crowd funding?

    14. Re: Duh... by Jarik+C-Bol · · Score: 5, Insightful

      Thats his point (i think) His ideal Kickstarter is more along the lines of "Hey, i've been tinkering in my garage for the past 5 years with my own money, and have finally proven that my idea is not only cool, but not actually impossible! I have a functioning prototype that does not explode 5 seconds into use, and am now kickstarting to bring it to manufacturing and retail."

      At which point, millions of dollars are put into an escrow account by thousands of enthused people, and a loan for some amount less is issued to the inventor to actually produce the product. When units start shipping, the money from the escrow account is used to pay off the loan and any balloon expenses, with any extra going to the inventor.

      This would help filter out the people who use kickstarter in the "Hey, I have a neat idea, but i'm going to need about 500K to find out if its even physically possible." but say it in a way that insinuates that the 500K will bring it to your doorstep. Those projects belong on GoFundMe.

      --
      I've decided to Diversify my Holdings. I've divided my cash between my left and right pockets, instead of all in one.
    15. Re:Duh... by JoeMerchant · · Score: 5, Interesting

      I've "bought in" to 3 kickstarter like projects... One - an RC paper airplane, came off very much like a long lead time order fulfillment. Another, attempting to compete with Amazon Firestick and Chromecast, perhaps predictably, faltered when they tried to swim with the competition in delivery of "protected content" and ultimately refunded the "investment;" personally, I didn't want delivery of protected content and they weren't going there when I bought in, but I understand why they later decided it was "essential to the product," and from that point, their failure was all too predictable. The third: Jolla Tablet, remains to be seen.

      I've worked in a half dozen startup environment companies where a 33% success rate would be huge, and investors rarely get anything back from failures in "the real world." If you're putting money into kickstarter and similar projects, you have to know that money is at risk, subject to anything from delays to total loss. I view it more as "philanthropic investment" than product purchase. You're tossing these guys a few bucks because you believe in them, and maybe if they succeed you get the first round of cool widgets when they come out. So far, I've always eventually gotten product or a refund - that's a really amazing track record in the world of inexperienced business people.

      If you want to purchase products with hard delivery dates and money back guarantees, stick to Amazon. Startup ventures are something else entirely.

    16. Re:Duh... by Anonymous Coward · · Score: 0

      It's not that foolish. A German group already has a working version.
      https://www.youtube.com/watch?v=4C9LTZCmb8Q

    17. Re: Duh... by TWX · · Score: 2

      So, what happens to the money in-escrow? Do the original contributors get it back? Does the entity that solicited the funding get some to help pay is obligations that it would not have sought had it not thought it would have the funding to cover them?

      The whole point of investing is that the investor takes a risk in exchange for what could be a greater reward. Smart small-time investors do not invest money that they cannot afford to lose. Smart big-time investors spend a lot of time calculating risk and attempt to balance the risk with the reward, knowing that some investments will fail entirely regardless.

      I've worked for small companies whose investment dollars were trickled-in. Those companies folded when investors got cold-feet. That's part why companies usually try to get funding in lumps, because they can budget the use of the funding better when they know how much they have and for how long. Yes, it means that the investor has to make sure that the company isn't going to use the capital to purchase thousand-dollar chairs and to hold lavish parties, but at the same time, the investor still knows that there are risks when giving others money.

      --
      Do not look into laser with remaining eye.
    18. Re:Duh... by Opportunist · · Score: 1

      Yes, investing carries a risk. What's that got to do with kickstarter?

      Kickstarter is no investment. An investment is me putting money behind a project with the intent to eventually either get control over the project or at least get money + X*money back from it. With X usually being at the very least in the double digit percentage, if not triple digit. At least expected.

      Kickstarter's ROI is more in the area of getting the product earlier, cheaper or with some added special "members only" features, or a combination thereof, making it more akin to some sort of long term preorder than an investment.

      --
      We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
    19. Re:Duh... by Anonymous Coward · · Score: 0

      But they still don't have a consumer product or much support from game developers. "VR" is a flash in the pan, just like it was back in the 90s.

    20. Re: Duh... by west · · Score: 1

      How is a product supposed to be developed and manufactured when the owners don't have the money they raised from the crowd funding?

      I guess my point wasn't clear - Call the new company "OF" for "Order Fulfillment". You see something on the OF page and you order, then you get charged if minimum order size is made (and there's probably a maximum order size as well). The money is collected by "OF" and held in escrow. It will be paid once the customer receives the product within a specified time. If the customer doesn't, then he or she is refunded the whole amount.

      The project sponsor now has a guaranteed sales. If he has contracts in hand with the manufacturers to make the stuff, and minimal reputation, he then goes to the bank to get a loan. (Loans for this sort of thing are common in business.) Of course, if he fails, then he is *personally* on the hook for the loan. The bank will only loan money if everything is in place for simple order fulfillment.

      The consumer then has real transparency - order from "OF" - you only pay if minimum orders reached, and you get full refund if no product within the time specified.

      Otherwise, you can still fund KS projects and accept a 50-75% failure rate (because most 'safe' projects go "OF" route), and maybe get neat stuff. If you aren't willing to take the risk, then you don't fund.

      The whole point is to make *what* you are funding transparent and to strip away the ambiguity from both the project runners and the funders ("I'm funding development, but without any risk!").

    21. Re: Duh... by jordanjay29 · · Score: 1

      So you're moving the risk from the crowdfunders to this nebulous OF company? If someone were able to personally obtain a loan for the product anyway, why would they approach Kickstarter/Indiegogo? Why wouldn't they just sit down at their local bank? You'd have to have a pretty compelling loan program for this to be more appealing than a regular loan or the current state of crowdfunding.

      Honestly, what you're talking about sounds like a marriage of Kickstarter and Massdrop, and probably could be a successful business if you were to come up with a friendly loan program. The last thing we need to see is another business out to generate more debt among the middle class.

    22. Re:Duh... by zotz · · Score: -1, Offtopic

      Or... more people could start taking my advice as offered here:

      http://zotzbro.blogspot.com/20...

      And as I tried for unsuccessfully here:

      https://www.indiegogo.com/proj...

      (I really need to run some more experiments along these lines...)

      I think I just had an idea to promote this...

      Check this newly created Facebook group to see the idea begin and grow...

      https://www.facebook.com/group...

      all the best,

      drew

      --
      FreeMusicPush If you want to see more Free Music made, listen to Free
    23. Re:Duh... by GuB-42 · · Score: 1

      AFAIK, backers got their rewards. That's much better than many other projects.

    24. Re:Duh... by trout007 · · Score: 1

      People voluntarily taking a risk with their own money with the hopes of a return is the definition of "the market".

      --
      I love Jesus, except for his foreign policy.
    25. Re:Duh... by DaTrueDave · · Score: 1

      Mod parent up.

      I've thrown money at crowdfunding projects simply because they look cool and I'd like to see them succeed. Some of them do (someday, when I have land, I'll get a Flow Hive). Some of them don't (the Human Resources game looked cool, but, alas, it was not to be).

      The foolishness is expecting every single crowdfunded project to succeed.

    26. Re:Duh... by loneDreamer · · Score: 1

      People voluntarily taking a risk with their own money with the hopes of a return is the definition of "the market".

      That is 'a' (rather than 'the') definition for market. It is extremely common nevertheless to expected the return for an investment to be monetary profit, not whatever you get in return. Else even NGOs and other non for profit institutions would qualify as "the market". So I'm ok with my use of "market" if most people get my meaning, which is the entire point of language and definitions IMHO.

    27. Re:Duh... by Anonymous Coward · · Score: 0

      Oh no, they pulled a Ben Carson. They didn't actually get the $1M, but would have gotten it, had they applied.

    28. Re:Duh... by Anonymous Coward · · Score: 0

      And as I tried for unsuccessfully here:

      https://www.indiegogo.com/proj...

      That's just selling a royalty-free copyright license, the art is no more "free" than anything else.

    29. Re:Duh... by Anonymous Coward · · Score: 0

      This is very confusing, on the one hand you say why not insist on Free Licensing for the resulting works, then you offer "rewards" of royalty free use of a certain number of photos (if they were released under a Free License then there is no question about royalties) but then say you will put up 1 day of photos under a Creative Commons BY-SA license.

      So if they are truly under a Free license then why would you think you can limit the freedoms of people to use them in such a way to be able to offer more photos for royalty free use at difference reward tiers?

    30. Re: Duh... by Anonymous Coward · · Score: 0

      Reminds me of http://www.meetearl.com/. Awesome tablet, but initially was supposed to ship 2 years ago. As of now, they are slating it for late next year. I stopped holding my breath long ago and thank god never sent them money.

    31. Re: Duh... by Anonymous Coward · · Score: 0

      But, if I have a kitchen tool that I've prototyped, but it would be better if I got the parts molded, I'd set my threshold at $20k for the mold and materials.
      How does the escrow solve the chicken/egg problem? I can't drop $15k on a mold. I can't ship 3d printed utensils (and the backers were wanting finished goods anyway, not protos).

      Accept that some fraction of projects will just die. That means that I don't fund anything that's not in my disposable income.
      I've been burned at 4/20 projects, and one of those actually shipped hardware, but the firmware in it was non-functional.

    32. Re: Duh... by west · · Score: 1

      If someone were able to personally obtain a loan for the product anyway, why would they approach Kickstarter/Indiegogo?

      The problem is that very few banks will lend you money when you say "I want to manufacture 10,000 of these, and *if* I can sell them, I can pay you back." The service that "OF" provides is that it already has all the funds in escrow. "If I manufacture 10,000 of these, I have a guaranteed payment of $500K" is something that specialized banks finance on a fairly regular basis.

    33. Re:Duh... by aaronb1138 · · Score: 1

      A class action needs to smack Kickstarter hard.

      Besides the representation of investment as a long lead order fulfillment system, I can't imagine where they aren't violating some investment laws whether it be because they aren't providing investors with shares or not accounting for fulfillment as capital gains.

      As for people trying to tout their anecdotally high success rates (e.g. 33%) compared to traditional investing, they seem to missing the fact that almost no Kickstarter has approached a novel problem. Everything they deal with is in the realm of known solution, can we produce in volume that people with the solution in hand won't touch because in the given industry, the business isn't there (from a volume perspective).

      The average Kickstarter is essentially this: I know the components to make this product cost this much. Manufacturing by skilled labor adds this much. I can't make it myself or obtain those parts because I only want one. Essentially it's acting as an end around for the fact that all the parts are held hostage by the warehousing model and building a lot of simple things is 10-100x more than what manufacturers are able to directly assemble them at due to volume. A fine example is kit cars from mostly off the shelf parts from other automobiles. The rest of the Kickstarters are generally charlatans, especially including the ones with a good idea on a napkin. Those guys are just happy to have gotten 3 years of stable employment out of other people's wishes.

    34. Re: Duh... by Jarik+C-Bol · · Score: 1

      You missed part of my comment. the Kickstart funds are put in escrow, and a LOAN is issued to the inventor for tooling/production. IF the inventor manages to use that loan to ship product, the money comes out of escrow and pays off the loan, with any excess funds being given to the inventor. if the inventor FAILS to use his loaned funds wisely, and fucks off to ikea and buys an entire house worth of crap instead, he is expected to pay off the loan himself, and the money is returned from the escrow to the investors. clearly, there would need to be some careful setup to prevent screwing people who come up 5$ short of shipping their product, but its better than what we have.

      --
      I've decided to Diversify my Holdings. I've divided my cash between my left and right pockets, instead of all in one.
    35. Re: Duh... by tburkhol · · Score: 1

      The problem is that very few banks will lend you money when you say "I want to manufacture 10,000 of these, and *if* I can sell them, I can pay you back."

      Even fewer banks will lend you money when you say "I want to manufacture 10,000 of these, and *if* I can, I can pay you back." Selling stuff at a profit, where you know the production cost, is the easy part.

      Banks absolutely do not want to lose their capital. If they think there's a 2% chance of not getting paid, then you're not getting your loan. Venture capital, they know they face 80-90% failure rate, but they hope that the projects that fail to fail do so extravagantly. Kickstarter/IndieGoGo are for projects so speculative that they can't even attract venture capital. There's no way they're getting a loan, regardless of whether they can demonstrate an orderbook or not.

      Kickstarter is also good for artist-support projects, where someone needs front-money for recording or production costs, but that's a different animal entirely.

    36. Re:Duh... by 3.5+stripes · · Score: 1

      The Gear VR2 sitting on my desk, and the multiple engineering builds of the rift I've seen don't agree with you, but hey, gotta hate the facebook.

      --


      He tried to kill me with a forklift!
    37. Re: Duh... by LunaticTippy · · Score: 1

      People can already get loans for business ideas, and that is how a lot of businesses grow. Things like kickstarter are where people who cannot get loans of sufficient size turn for money.

      I guess things could be structured as a loan, but frankly these loans are going to be terrible risk. If the business idea fails you are not getting your money back. The inventor will declare bankruptcy or simply be unable to pay.

      --
      Man, you really need that seminar!
    38. Re: Duh... by Anonymous Coward · · Score: 0

      Wtf. I feel like this would be an easy project once you have funding. Make the designs, find a cheap factory in China, profit. Fix it all in version 2.

    39. Re: Duh... by west · · Score: 1

      Even fewer banks will lend you money when you say "I want to manufacture 10,000 of these, and *if* I can, I can pay you back."

      Agreed. It is why you already need to have the manufacturing contracts in hand. Thus you know the costs, the delivery dates, etc.

      Kickstarter/IndieGoGo are for projects so speculative that they can't even attract venture capital.

      The problem with that is that is not how they're seen at this point in time by the vast majority of the customers and many of the sponsors. The howls of outrage when projects fail to ship make it clear that the majority of customers do not distinguish between simple order fulfillment and a speculative venture. Nor does KS et al make any great effort to make the difference between such projects clear to the customer.

      Perhaps KS could calve off another company for the majority of sponsors who in fact are only using KS to accumulate a minimum order for their product, but have manufacturing contracts, delivery contracts, etc. in hand. That way the truly speculative ventures aren't gaining supporters through customer misperception. After all, I'm happy to gamble, but I want to know when I'm doing so and the crowd-funders aren't making it easy to tell the difference.

      My proposal was simply an idea to clearly differentiate the two. One has guaranteed delivery or a full refund, the other most certainly does not.

    40. Re:Duh... by Half-pint+HAL · · Score: 1

      The point of the Kickstarter model is that there are laws against normal people making investments. This is due to the long history of fraud and snake oil in the US -- Ponzi schemes; the movie production company that's going to put your small town on the map etc. In order to be allowed to invest in an enterprise not run by someone you know, you have to be a certifiable "informed investor". Microfinance can't work in that climate. (Other countries rely on strong fraud laws to deal with this situation -- with luck the US will follow suit soon.)

      --
      Got them moderator blues I blieve I walk out the do', With these mod-points I been gettin', I 'most never post no mo'
    41. Re: Duh... by Anonymous Coward · · Score: 0

      I think the point is -- the loan is the amount requested to get the project underway. They get the amount requested to fund and have to make their first tier or two with that. It would reduce the use of fundraising as advertising where they duplicitously say "we only need $10K to do this! come fund us!". The big payout for the designer is additional funds if the fundraising goes 100X -- but ONLY on delivery. I think this is a great idea that would minimize or even get rid of these fly-by-night failed attempts and get a good chunk of the money back to the backers on failure. If you can't ship your earlybird tier you can pull the cord. It would reduce absolute failure and keep companies more honest with their funding requirements. I would be much more likely to fund an operation under these terms than indiegogo or kickstarter.

  2. In Soviet Russia by Anonymous Coward · · Score: -1

    Regan collapse government.

    1. Re:In Soviet Russia by Hognoxious · · Score: 1

      In Soviet Russia, a T.P.Burnum is born every minute!!!

      --
      Confucius say, "Find worm in apple - bad. Find half a worm - worse."
  3. It's almost as though there is a moral here by Anonymous Coward · · Score: 0

    Personally I like to buy things that already exist rather than plunk down money on something that doesn't, and would probably suck even (if ever) it does get made.

    1. Re:It's almost as though there is a moral here by ledow · · Score: 2

      At the absolute very least, you need a proven history of delivering on previous promises. The only kickstarters I've backed are from companies which have already given me a product via conventional channels and are asking for help. Those kinds of things generally work out fine, because you know they can deliver, can be trusted, the quality of their previous work.

      But, yeah, the "we have a bright idea" crowd have a long way to go to prove themselves.

    2. Re:It's almost as though there is a moral here by JaredOfEuropa · · Score: 4, Insightful

      There's a lesson there for our gov't buying into the F-35 programme as a tier 2 partner.

      --
      If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
    3. Re:It's almost as though there is a moral here by ranton · · Score: 4, Interesting

      Personally I like to buy things that already exist rather than plunk down money on something that doesn't, and would probably suck even (if ever) it does get made.

      Or, only spend money on kickstarter that you are willing to lose. It should be treated no differently than spending money on a trip to Vegas. If I give myself a budget of $500 to gamble with, I am perfectly happy if I leave Vegas with $10 of that money left. And if someone spends $500 on 10 kickstarter campaigns, he should be very happy if 5 of them end up sending him a product someday.

      Kickstarter is only for pie in the sky dreams that couldn't get traditionally funded, but where people want to give the founders a shot because their products sounds cool. Or at least that is how I think people should treat Kickstarter. People can spend their money however they wish.

      --
      -- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
    4. Re:It's almost as though there is a moral here by khallow · · Score: 1

      I think the moral here is how cheap the failure/lesson was.

  4. But but but but by Anonymous Coward · · Score: 0

    3D printed graphene in a private space station on Mars and the free market and computers got better?

  5. ANOTHER one? by Anonymous Coward · · Score: 5, Insightful

    You do know that most ventures fail within the first few years, right?

    I mean, 1 MILLION DOLLARS? Even Trump recognizes that's a small sum—for old buildings, let alone a robotic fucking dragonfly.

    You know what, though? The crowd got what it wanted: They crowd was able to participate in helping really smart people spend a few years tinkering away on something interesting to both them and the crowd; that's exciting enough, especially if the world gets access to the fruits of their labor.

    Christ. "Another one"; get real.

    1. Re:ANOTHER one? by Beezlebub33 · · Score: 5, Insightful

      I completely agree with this sentiment.

      Making a robotic dragonfly is very hard, they had a good idea, and a plan, and were able to sell it. They spent the money trying to do it, did some research, and now they are trying to make sure what they did ends up available to everybody.

      Yeah, it's a failure in that they weren't able to do what they wanted to; but it wasn't a scam, or dishonest, just normal everyday good-effort failure.

      --
      The more people I meet, the better I like my dog.
    2. Re:ANOTHER one? by Anonymous Coward · · Score: 0

      Apparently it's news now because most web sites now report on these "ideas" like they're real products. The headline will be "awesome new thing available now!" or "six year old prodigy invents perpetual motion machine" or something like that, but when you read the article to find out where it can be purchased, it's a link to some damned Kickstarter idea which, if enough other people contribute money, might possibly be a real thing in a year or so.

      I blame millennials. I'm not sure why, but it's probably their fault. It's probably from the rash of movies about genius kids who can build anything. :)

    3. Re:ANOTHER one? by BarbaraHudson · · Score: 4, Funny

      "six year old prodigy invents perpetual motion machine"

      Six year olds ARE perpetual motion machines :-)

      --
      "Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
    4. Re:ANOTHER one? by Anonymous Coward · · Score: 0

      You know what, though? The crowd got what it wanted: They crowd was able to participate in helping really smart people spend a few years tinkering away on something interesting to both them and the crowd; that's exciting enough, especially if the world gets access to the fruits of their labor.

      Yes. If they're uploading all the progress so far. Then at least it sounds like they're finishing with the best of intentions and any one else who has time and funding can take it a step further if they desire.

      Here's a crazy thought. If they can't find investors they could create a second indegogo campaign to raise a round 2 of funding.

      Another crazy thought. If people have so much spare money for projects maybe we could try to solve world hunger or clean up Fukushima or something?

    5. Re:ANOTHER one? by stikves · · Score: 1

      Yes. They seem to spent honest amount of effort on their idea, and still have not given up. This is not like some scoundrel who just take the money, and leave without a trace. There was real development, albeit it fell short. And judging by the project scope, it is reasonable to conclude that one million is not nearly enough to run a robotics team for several years.

    6. Re:ANOTHER one? by rsborg · · Score: 1

      "six year old prodigy invents perpetual motion machine"

      Six year olds ARE perpetual motion machines :-)

      Only if you can keep them perpetually six years old. This might require some temporal mechanics.

      --
      Make sure everyone's vote counts: Verified Voting
  6. Seriously???? by JustAnotherOldGuy · · Score: -1, Redundant

    "They haven't been able to resolve issues with the drone falling apart after just a few seconds of flight."

    Seriously?

    After blowing through a million dollars they haven't been able to get the thing to stay together for more than a few seconds? Have they ever heard of this stuff called "glue"?

    --
    Just cruising through this digital world at 33 1/3 rpm...
    1. Re:Seriously???? by Anonymous Coward · · Score: 1

      "They haven't been able to resolve issues with the drone falling apart after just a few seconds of flight."

      Seriously?

      After blowing through a million dollars they haven't been able to get the thing to stay together for more than a few seconds? Have they ever heard of this stuff called "glue"?

      If it's so damn easy, why aren't you the one pocketing that million dollars?

    2. Re: Seriously???? by Anonymous Coward · · Score: 1

      Ethics.

    3. Re:Seriously???? by Anonymous Coward · · Score: 0

      JustAnotherOldGuyWhoAintDoneShit

      FTFY

    4. Re:Seriously???? by Anonymous Coward · · Score: 0

      "After blowing through a million dollars they haven't been able to get the thing to stay together for more than a few seconds?"

      Heh. Never done a (real) engineering project, have you? Be honest, and software doesn't count (it isn't engineering).

    5. Re:Seriously???? by Anonymous Coward · · Score: 0

      Try gluing the wings of a dragonfly and see if it flies.

    6. Re:Seriously???? by Anonymous Coward · · Score: 0

      Stealing from stupid people is not nice.

    7. Re:Seriously???? by Hognoxious · · Score: 1

      [goes outside]
      You wait. Time passes.
      [comes back in]

      The answer appears to be yes, but only in an approximate parabola.

      --
      Confucius say, "Find worm in apple - bad. Find half a worm - worse."
    8. Re:Seriously???? by Opportunist · · Score: 1

      *sigh*

      We're not gonna hear the end of that Manhatten Purchase by Minuit, are we?

      --
      We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
    9. Re:Seriously???? by Anonymous Coward · · Score: 0

      What's "Manhatten", and who purchased it?

    10. Re:Seriously???? by tehcyder · · Score: 1

      Don't make jokes about Kickstarter. In slashdot terms that's like kicking a puppy.

      --
      To have a right to do a thing is not at all the same as to be right in doing it
  7. Why more careful? by mseeger · · Score: 5, Insightful

    This is exactly what crowdfunded projects are supposed to be.Projects can fail.

    This seems to be a 100% genuine failure. I would not even regret having spent money there. Other projects (e.g. Clang!) failed in a more circumspect way.

    Indiegogo and Kickstarter are no warehouses like Amazon.

    1. Re:Why more careful? by TapeCutter · · Score: 2

      Actually it might not be a 100% failure, perhaps there is something interesting in their research, even knowing something about what doesn't work can be useful. I'm assuming the navy are interested in the idea from an engineering POV. We know very little about building machines on the scale of real insects. Still lots to learn from real dragonflies, such as why don't their wings fall off after a few seconds?. - I hear the navy is willing to pay $1M to find out.

      --
      And did you exchange a walk on part in the war for a lead role in a cage? - Pink Floyd.
    2. Re:Why more careful? by mseeger · · Score: 3, Insightful

      Yep, it is only a failure in delivery.

      Had I spent money on it, I would not have considered the "investment" failed.

      I (co-)founded several companies in my career. The chances of success are rarely better than 1:4, rather 1:10 in most cases.

      So instead of saying "it failed" let's use "We found a 1-million-US$ approach that doesn't work" ;-).

    3. Re:Why more careful? by Pinky's+Brain · · Score: 1

      Maybe if they had open accounting and I knew exactly how much they enriched themselves.

      At the moment they are a mess of perverse incentives and an invitation to scammers.

      The backers came out of this poorer, how did they starters come out of it?

    4. Re:Why more careful? by mseeger · · Score: 1

      That project seems to be rather transparent or at least tries to.

      There are project where I ended up angry (Clang! is an example).

      I did not dig into details, but from my current PoV I probably would not be angry here.

      I (co-)founded startups that burnt more per month and nobody got rich in the process ;;-).

    5. Re:Why more careful? by interval1066 · · Score: 2

      This is a non-story. Most ventures fail, this is not news, this is a typical example. As for the engineering, I'm not exactly sure what problem they were trying to solve that conventional rotor wings couldn't over come, but a lot of inventions start out to solve one problem and are actually more beneficial for another. Acrylic was invented this way, among many other things. Its not uncommon to set out to solve X, and turn out solving Y. So, rather than look at this as a failure let's celebrate this as the ability to access money to try things out. Even stupid ones.

      --
      Python: 'And then suddenly you have a language which says "we're all stuck with whatever the whiniest coder wants".'
    6. Re:Why more careful? by Greyfox · · Score: 2

      I would expect most projects to fail. Nothing about this model insures any higher success rate than any other model of starting a business. Except maybe you have a clearer idea of how many people will actually want to buy a product you want to make. Investment is entirely about risk and how much of it you want to take on. It seems many investors have forgotten about that, or were never aware of it in the first place.

      --

      I'm trying to teach myself to set people on fire with my mind... Is it hot in here?

    7. Re:Why more careful? by Pinky's+Brain · · Score: 1

      Your VCs almost certainly got a look at the books.

      IMO million dollar plus should set some money aside for auditing of the books, if an independent third party says the obligations have been met they get the money, if not there's an audit and we all get to see how they really spend the money.

    8. Re:Why more careful? by rtb61 · · Score: 1

      In this case the failure is down to just one thing, wing motion. They straight up and down design assumption is simply too difficult for a high speed too rigid wing. A more circular motion would work better, with continual adjustment of wing pitch to achieve desired air flow.

      --
      Chaos - everything, everywhere, everywhen
  8. Slashdot hates Capitalism! by Daemonik · · Score: -1, Troll

    Why are all these SJW's trying to prevent the invisible hand of the market from working??? Are they TRYING to get the marketplace regulated!?!?!?! These are the sorts of things that separate the winners from the losers! The losers deserve to be poor and broke and die on the streets for not being wiser with their investments! It's Darwin! It's what Capitalist Jesus would want! That's why Jesus went off on the moneylenders, you know. They'd gone bankrupt investing in a housing bubble and were begging for a government handout THANKS OBAMA!

    News for nerds? This is news for SJW's! Why's it on my Slashdot?????

    1. Re:Slashdot hates Capitalism! by Anonymous Coward · · Score: 0

      You didn't hate that! Somebody else, the SJWs, hated that for you

    2. Re:Slashdot hates Capitalism! by Anonymous Coward · · Score: 0

      Why are all these SJW's trying to prevent the invisible hand of the market from working??? Are they TRYING to get the marketplace regulated!?!?!?! These are the sorts of things that separate the winners from the losers! The losers deserve to be poor and broke and die on the streets for not being wiser with their investments! It's Darwin! It's what Capitalist Jesus would want! That's why Jesus went off on the moneylenders, you know. They'd gone bankrupt investing in a housing bubble and were begging for a government handout THANKS OBAMA!

      News for nerds? This is news for SJW's! Why's it on my Slashdot?????

      Meh... you're another one of those morons that like to blame Democrats for the consequences of bankers. It is funny too because it was the Dodd - Frank bill that started us going back in the right direction. That direction is the direction of re-regulating what the republicans during the Bush (dubyah.. the retarded cowboy one not daddy Bush that is) de-regulated.

      You need to watch the documentary called "The Smartest Guys In the Room" and then you will start to realize the level of "Fast and Loose" that the Bush administration played with the economy, and now the tea partiers like to try to blame democrats and Obama for.. because it is fashionable and most of the simpletons just repeat what they say without doing any research or thinking for themselves. (Thats right.. just like you just did there.)

      Watch the documentary and and educate yourself.. I am not telling you what to think, I am telling you how to cure your ignorance.

      Be well.

    3. Re:Slashdot hates Capitalism! by Anonymous Coward · · Score: 0

      Why's it on my Slashdot?

      Why are you on my Slashdot?

  9. People know there's risk by Anonymous Coward · · Score: -1

    Don't patronize your readers by painting some picture of a supposed risk-less way to make your dreams come true. That's called being a liberal.

    Life is hard.

    Life is pain. Anyone saying different is selling something.

    Each consumer weighed the risks and rewards and rolled the dice to the level they felt comfortable.

    1. Re: People know there's risk by cyber-vandal · · Score: 2, Insightful

      Liberals are well aware of that. Liberals are also aware that if you make people's lives better through such Commie things as universal education and not bankrupting them for the crime of getting sick they tend to be more productive.

  10. Well by DaMattster · · Score: 2

    It's pretty clear (or should be) that crowdfunding is a risky venture. If you think otherwise, I have a slightly used bridge to sell you.

  11. Example? by frnic · · Score: 2

    I don't understand, they were pretty upfront with what they had and what they want to try to do. Seems to me that is kind of the point of Crowd Funding, when you can't get real investors.

    Seriously, everyone seems to want guarantees about everything - lighten up people, if you want to have a guaranteed return by Treasury Bonds...

    1. Re:Example? by Kjella · · Score: 1

      I don't understand, they were pretty upfront with what they had and what they want to try to do. Seems to me that is kind of the point of Crowd Funding, when you can't get real investors. Seriously, everyone seems to want guarantees about everything - lighten up people, if you want to have a guaranteed return by Treasury Bonds...

      But you have two fundamentally different reasons for lack of "real investors", the market risk and the project risk. For example I backed a Kickstarter to create public domain recordings of classical music, extremely low project risk since such recordings are made all the time but clearly not a good economic investment. The game Elite: Dangerous would be somewhere in the middle, sure it's a new game but within a known genre and without any truly experimental technology. And then there's the ones that promise to do something revolutionary new, where you really should take their claims with a ton of salt. Unfortunately many see a presentation, some photoshopped pictures and a little hand-waving and think this is basically a pre-order when it's not.

      --
      Live today, because you never know what tomorrow brings
    2. Re:Example? by LordWabbit2 · · Score: 1

      if you want to have a guaranteed return by Treasury Bonds
      And even that is not a guaranteed return.

      --
      There are three kinds of falsehood: the first is a 'fib,' the second is a downright lie, and the third is statistics.
  12. What bugs me in kstarter, is not when it fails by Kartu · · Score: 1

    I mean you bet X bucks, company might or might not manage to do it, if it fails, you lose.
    I'm OK with that.

    The problem is even when one out of a hundred (thousand?) projects is a huge success, e.g. Oculus Rift, backers don't get rewarded for it. AT ALL.

    1. Re:What bugs me in kstarter, is not when it fails by Anonymous Coward · · Score: 0

      "I mean you bet X bucks, company might or might not manage to do it, if it fails, you lose."
      Not quite like that.
      When you gamble all you need is money for your stake. That's it.

      In projects like this you can skew the odds in your favor by gathering information about the technology, asking people who know it, and most importantly the people themselves. It's still a gamble, since you'll never know if those involved can live up to the promises, but there are a lot of things you can do before throwing money at them.

      This is actually even better than the stock market since all you have there is the name of a faceless corporation and some past performance. No idea of who is in the decision chain.

      I think people like this type of thing, because even limited it gives them a form of control. Something similar to that feeling when donating or working on open source projects.

    2. Re:What bugs me in kstarter, is not when it fails by zotz · · Score: 1

      I posted a suggestion for solving this problem here:

      http://news.slashdot.org/comme...

      Your thoughts?

      all the best,

      drew

      --
      FreeMusicPush If you want to see more Free Music made, listen to Free
  13. Good old American ambition and arrogance by Anonymous Coward · · Score: -1

    often falls flat on its face. "We can do anything we put our mind to!", no, you can't. Especially not without thorough research before asking people for money.

    1. Re:Good old American ambition and arrogance by Anonymous Coward · · Score: 0

      You are a Luddite. Computers got better, and people once thought we can't fly. Therefore, anything we put our mind to is possible. Like orbital factories! No, wait... Like mining asteroids! No, no, wait... Like space-based solar power!! Um, no, wait... Like colonizing Mars! No, no, no, wait...

      Um, 3D printed cars! And graphene colony ships for the species!

  14. I've always laughed at the idea by Anonymous Coward · · Score: 0

    These start-up crowd-funding drives have always made me laugh. They want me to give them an interest free loan with no security? It's ridiculous.

    Then look at what happened to Oculus Rift, I doubt the later events were what people were supporting when they gave them their support and funding.

  15. follow whie hiking or skiing? suckers by Anonymous Coward · · Score: 0

    who in the world would consider the ad video realistic when they show and state those things? The battery required to do those would be so large the wings could not sustain it let alone be controllable at those speeds(skiiing). No surprise it's gone nowhere.

  16. is it too late to donate? by Anonymous Coward · · Score: 0

    I feel left out.

  17. lessons for you by Anonymous Coward · · Score: 1

    1. Youth - good, and required, principal ingredient for success and the future of any company. But is 2x-edged sword. Need experience for what is essentially an aerospace project.
    2. Equipment - do not need new stuff. Buy everything from used test equipment dealers. Most older stuff is not only more cheap but is more reliable. The only exception might be o-scopes/analyzers, as the Rigol stuff is dirt cheap and decent performance. Some of their combo scope/logic analyzers are used by my employer as 'throw-away' equipment for use in our TJ factory.
    3. Empirical vs Computer data - the common example is spice. Younger engineers tend to design stuff using spice. While I do some crazy what-if modeling using spice - the basis of my design veracity is the empirical data from DVTs. Also use spice for monte-carlo tolerace analysis. Not certain if this group attempted to reconcile their design model with real data soon in the project, but would guess that they did not.

  18. "issues with the drone falling apart" by tlambert · · Score: 2

    "haven't been able to resolve issues with the drone falling apart "

    It doesn't sound like they need more funding; it sounds like they need better engineers.

    1. Re:"issues with the drone falling apart" by endoboy · · Score: 1

      Given that engineers a fond of food, clothing, housing and beer, they needed more funding

  19. Another IndieGoGo scam by SkOink · · Score: 3, Interesting

    It's worth pointing out that Kickstarter would never have allowed this campaign. IndieGoGo is so much scammier that it's ridiculous. I don't think I'd ever 'invest' in a crowdfunding campaign from either site, but if I did it would be Kickstarter because of the following policy differences:

    - With IndieGoGo, you get to keep the money even if you don't reach your funding goal.
    - With Kickstarter, you can only show actual prototype hardware in your videos/campaign site - no mockups or 3D rendering allowed.

    It's pretty easy to see how these differences mean that IndieGoGo is the go-to site for products like:

    https://www.indiegogo.com/projects/robot-dragonfly-micro-aerial-vehicle#/
    https://www.indiegogo.com/projects/batteriser-extend-battery-life-by-up-to-8x#/
    https://www.indiegogo.com/projects/anonabox-access-deep-web-tor-privacy-router#/
    https://www.indiegogo.com/projects/kreyos-the-only-smartwatch-with-voice-gesture-control#/
    https://www.indiegogo.com/projects/solar-roadways#/

    just to name a few.

    --
    ---- I'll take you in a Hunt deathmatch any day.
  20. More careful??? by sribe · · Score: 1

    Why, exactly, do "consumers need to be more careful" with a $99 speculative advance order of a fancy little toy???

    1. Re:More careful??? by holophrastic · · Score: 1

      You beat me to it. Speculative, relatively small dollar amount, toy. Seems that the possibility of failure is quite well understood.

      Paying for something, in-advance, is always understood to be a risk. That's why we have various forms of eskrow.

  21. Why reinvent the wheel? by Anonymous Coward · · Score: 0

    Festo has already succeeded in creating a robotic dragonfly to showcase their technologies to potential customers.

  22. Not for me. by Anonymous Coward · · Score: 0

    It's good that crowdfunding exists, but I wouldn't pre-fund any of the projects I've ever seen. At the most I've bought a working beta I was satisfied with if even it didnt progress further. (Minecraft, Grim Dawn, World Of Tanks spring to mind)

  23. Moving risk is the point. by Anonymous Coward · · Score: 0

    The entire point of crowdfunding is that it moves the risk to the consumers instead of investors.
    Sometimes that works out, sometimes it doesn't.

  24. Why more careful? by SuperKendall · · Score: 1

    If I contribute to hardware sometimes it's just because I want the research to be done, even if I give the production of a final result only a 50/50 chance (or worse) of delivering. Some things work to, some things don't, but the beauty of crowdfunding is that at least you are funding development of things that simply would not exist otherwise. You don't need to be more careful; you need to contribute more ambiously and care less if you get something you can hold from it.

    --
    "There is more worth loving than we have strength to love." - Brian Jay Stanley
  25. Robotic Fireflies do exist (since 2013) by ffkom · · Score: 1

    German machine manufacturer Festo demonstrated an actually flying "Firefly" at the Hannover exhibition in 2013, see https://www.festo.com/group/de... for more information/videos. But of course, some "old economy" company building such is not quite as "hip" with the crowd hipsters as some garage boys are ;-)

  26. PayPal virtual CFO to blame? by Anonymous Coward · · Score: 0

    These asshats claim PayPal imposed a virtual CFO to meter out their money, but did most negotiations with that CFO over the phone, so no paper trail. The virtual CFO allegedly demanded production in China to reduce costs, but the chinese vendors kept sending bad parts so they went back to domestic production, but that didn't entirely pan out either. So the project failed due to bad outsourcing forced on them by Paypal, if they are telling the truth.

    If that isn't bullshit, getting the virtual CFO to sign a document regarding their involvement and authority range, along with the timeline of funds being released, would be relatively simple, and will provide people with closure on a failed startup. That this still isn't available, along with TechJect trying to hire legal interns in India with questionable job ads, bodes badly. I say name and shame all those involved.

  27. Speculative Investment or advanced order? by Anonymous Coward · · Score: 0

    Just what is crowdfunding or at least what is it supposed to be?

    Is it an investment in an idea that may or may not work that may or may not yield a return on investment or is it just a long-term pre-order where you get a bargain price on a product that may or may not ship in the distant future?

    It appears most people are treating it as a pre-order when in fact it is a speculative investment.

  28. Invest by RageRifter · · Score: 1

    I'd still invest. If I set money aside for that kind of thing then I'm going to spend it on that type of thing. You have to keep pushing for the future. You never win without failing a few times. That's how you learn to win.