Failed GOkey crowdfunding project on Indiegogo shown charging a Samsung smartphone while connected to a Dell laptop.

Think Twice about Crowdfunding Technology Products

Many say crowdfunding is a great way to support a cause or product that you believe in or want to encourage. It’s the financial version of crowdsourcing. I have supported over a dozen crowdfunding campaigns myself, ranging from movies to mine removal.

Crowdfunding lets you experience The Thrill of Victory… and The Agony of Defeat

As suggested by the opening to ABC’s Wide World of Sports, you win some and you lose some. When it comes to crowdfunding, the project can go any of three ways:

  • Doesn’t raise enough in pledges and they are never collected
  • Collects the pledges and accomplishes what they said they’d do
  • Collects the pledges and doesn’t accomplish what they said they’d do

Support Tech Projects At Your Own Risk

Tech projects seem to be the biggest risk. Sometimes the technology behind the project is a stretch. (Fraud may come to mind, but it doesn’t appear that most of the organizers intended to deceive anyone.) Sometimes the team just got in over their head.

The Panono, a throwable panoramic ball camera, raised over a million US dollars in 2013 and actually produced the promised product. However they went bankrupt in 2017 without delivering the product to their supporters.

The Skarp Laser Razor blew-out its $160,000 goal on KickStarter, eventually raising $4,005,111 (four million US dollars) in pledges. However, there were some red flags, leading Kickstarter to shut-down the campaign and the funding. Not taking “no” for an answer, they started a campaign on Indiegogo.

GOkey

GOkey's Indiegogo crowdfunding campaign raised 1.2 Million dollars, over 25 times their target of 40 thousand dollars US.
GOkey’s Indiegogo crowdfunding campaign was wildly successful

One of the projects I supported, GOkey, was a spectacular fundraising success. The crowdfunding campaign on Indiegogo raised 1.2 million dollars US, over 25 times their target.

Unfortunately, the funding success did not lead to engineering success. Nearly three years after the funds were collected, the design and production challenges continued.

On April 2, 2017 the GOkey team sent this update to supporters:

Dear backers,

We will be sending a new email invite to all within 2 weeks time for final confirmations.

You will not be able to alter what you pledged for, but you will be able to change your shipping address and your connector preferences.

We apologize once again for the terrible delays and hope that all moving parts will run smoothly to the end.

All the best,

Doros and the GOkey team

The final update came less than two weeks later:

Dear Backers:

I sincerely regret to inform you that GoKey lacks the funds to complete the delivery of a viable product.  We ran into technical difficulties that we could not resolve.  There are no funds left to cover claims of suppliers and others or to offer refunds.  I have been exploring all avenues to raise additional funds so that we could complete and deliver the product, but we have been unsuccessful.

I honestly fought with all I had to do good at the end. Tried so hard to raise a round or form a partnership to deliver. And there have been times where a deal was looking 100% certain. But the age of the product, the liability and the negative cloud hanging over it always prevailed.

I am left with no alternative but to completely cease and shut down all operations and activities and consider filling for bankruptcy.

I feel terribly shameful for letting you down.

I am sorry,

Doros

How About You

Have you supported any crowdfunded projects? How did it work out?

 

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