Project is being liquidated but backers might not get their money back
It’s taken nearly two and a half years, but the doomed CST-01 Kickstarter campaign debacle has finally come to an end.
The company, which has strung along its backers sine January 2013, finally announced that it was liquidating its assets via and email and Kickstarter post, in which it apologised to supporters:
“Through all the challenges we’ve faced, the only thing that has kept us going is your belief in us. The last thing we wanted to do was to disappoint the nearly 8,000 people who generously backed our project so long ago. Unfortunately, some hard news follows.”
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The company blamed its woes on Flextronics, its chosen manufacturer, and said it couldn’t meet the demands regarding the thinness of the design, in low sub-10,000 unit volumes.
CST-01 was a 0.8mm thick e-paper watch, which received over $1m in funding – and enjoyed fanatical support from its army of backers. It was the Pebble Time of 2013 – but then things began to fall apart.
The Observer explains the story more succinctly than we can repeat, but after months of silence, backers became furious about the lack of progress. It also reported that supposed FCC filings which couldn’t be found led to speculation about whether CST-01 was a scam.
Sporadic updates from co-foundres Dave Vondle and Jerry O’Leary claimed Vondle had to live in a van in the manufacturers car park, but angry backers even disputed that.
Getting money back to backers
In their final correspondence, Vondle and O’Leary claimed that it would look to redistribute funds to its investors – although looking at the list of assets, it seems unlikely it will be able to completely reimburse everyone.
The co-founders said that if they can’t raise enough cash from their inventory, which ranges from USB cables to batteries, they could release their designs to the backers and make them quasi open source.
“We’d share everything we can on how to make the CST-01. We’ve had requests to do this and mail the parts to the backers. This is something we could do, but it’s at the bottom of our list of options because without the proper machinery—hot bar machines, ultrasonic welder, CNC encapsulation machine, specialty adhesives, screen printing, die cutting, etc.—backers simply won’t be able to assemble the watches by themselves,” they wrote.
“As far as liquidation of all assets, we’ll have all photography and inventory of all the pieces and machinery. We have even talked about selling everything on a public site like eBay so backers can all see the exact amount we’re able to recoup.”
It’s a reminder of how risky the crowdfunding process can be for backers, and how long it can take for projects to succeed and fail.
