Why the ZANO project team, which raised $ 3.5 million on Kickstarter, burned out in less than a year
Welcome to our readers on the iCover Blog Pages ! Recall that on December 8, 2015, the administration of the Kickstarer crowdfunding platform hired a journalist to investigate one of the most high-profile deceived projects in its history. You may have already guessed that this is a ZANO paparazzi drone project announced by Torquing Group and assembled in just one daymore than $ 1.020 million, and for the entire time of the crowdfunding company, instead of the declared target $ 190 thousand, more than $ 3.5 million ($ 3,550,665.20 USD) with 12,075 backers. The final of the story turned out to be truly dramatic, since not a single promised drone was delivered to the Kiskstarter backers. We will talk about the results of a journalistic investigation into the causes of the fiasco of one of the largest European projects in the history of the site.
Recall that at the end of May 2015, the Torquing Group team announced that the project was successfully moving to completion. According to Reece Crowther, marketing and business director of the ZANO project, the supply of drones was supposed to start in June-July 2015. In addition, the company published two encouraging demos showing the drone in action, and shared the details of the final development phase. Torquing Group's weighty trump card in attracting investors was a fairly rich track record of a company that has successfully worked on the development and production of drones for military purposes. At the same time, the quality of the products fully corresponded to the specific strict requirements of the military-industrial complex.
In fact, for project investors, the situation developed extremely unfavorably. When a BBC journalist visited the company’s office in August 2015, he learned that the drone is not able to take off outdoors and somehow only moves indoors. At the same time, the battery lasted for only 5 minutes of flight. It is clear that no successful shooting of streaming video and broadcasting it to smart devices within 15 minutes, selfie photo and support for image stabilization, wireless charging capabilities, upside-down flight, support for thermal imaging cameras and other promising, very delicious “pies” "Promised in the framework of the advertising campaign in this case we are not talking.
The July shipment promised to the Beckers Kickstarter did not take place. Instead, several hundred “barely alive” drones at the end of September were sent to the “lucky” of the 3,000 customers who paid for the drone through the project website. This caused a flurry of just indignation from loyal Kikstarter backers who had paid ZANO earlier.
At the same time, buyers from the ZANO website, who still managed to get drones, were literally shocked by the level of quality and extremely disappointed with the capabilities of the product. According to the description: the flight of the drone was reduced mainly to its rise above the horizontal surface by several centimeters, hovering in the air for some time, followed by a complete loss of controllability and the “flying” of the device into the wall. There was no need to talk about the quality of the video, nor about the promised possibility of enveloping obstacles, controlling with gestures and, moreover, completely autonomous flight.
Some of the affected beckers created an initiative group and even published a petition on change.orgdemanding to refer the case to the Arbitration Court and recover costs incurred from the project organizers. The text of the document states that the information provided at the level of advertising and video was knowingly false.
In mid-October, the date of the proposed delivery of ZANO to kickstarter beachers was once again shifted to February 2016, and in November CEO Ivan Ridman left his post “... for personal reasons and irreconcilable differences”. “Ax fell” and in parallel with the events described, the company management declared bankruptcy, liquidation of the business and sale of the remaining assets of the company due to accumulated debts. After these events, the former Touring Group administration ceased all cooperation with the Kickstarter platform, which is supposed to be the platform’s regulation in the event of a project failure.
As noted by the BBC in connection with the events, attempts to contact the executive director of Torquing Group Philip Busby (Philip Busby) but they did not contribute to clarifying the situation - no comments were received from him.
Certain attempts to get away from what was happening and made official representatives of Kickstarter. So David Gallagher in this regard stated the following: “Project organizers who want to produce and supply hardware are required to publish a demo with a functioning prototype of the device on the website page of their project. Thus, the creators are independently responsible for their projects, and the backers decide whether to fund them. ”
Nevertheless, the scale of investments and the number of project participants involved by the Touring Group administration in the ZANO project did not allow Kickstarter to limit themselves to standard unsubscribes. In order to clarify the circumstances surrounding the collapse of the project Kick was hired freelance journalist Mark Harris ( the Mark the Harris ), known for its publications in popular publications like The Guardian, The Economist and Wired.
Today, when the results of the investigation of the independent journalist Mark Harris are already known, it can be confidently stated that the collapsed ZANO mini-quadrocopter project advertised on the Kickstarter site by Torquing Group has become one of the most dramatic startups in history in terms of investment, number of backers and the scale of deceived expectations. crowdfunding industry. The collected materials allowed the journalist to name the main reasons that led to such a dramatic ending ...
At the time of the launch of the campaign on the platform, the Torquing team already had about $ 282 thousand, and most of the funds were invested by a British businessman who lost a total of about $ 353 thousand in this marathon. Moreover, the Kickstarter campaign was “fatal” ”Successful. As a result of the multiple excess of the amount of funds received in comparison with the original goal ($ 190 thousand), the Touring Group team was literally “inundated” with orders, which they failed to provide quality, timely service physically, technically and “psychologically”.
Such a rapid development of events and the omission of a series of deadlines previously agreed upon by Kickstarter caused a panic in the development team. Instead of starting with small test batches, gradually expanding production with a focus on quality and testing, Torquing began mass production of the crude product.
Despite the loss of control over the situation, the leadership hid the true state of affairs from subordinates and partners. So it was possible to find out that the two leading component developers had no idea how negatively the real scenario was developing. Moreover, their ignorance took place until the moment when it was no longer possible to hide the true state of things, because from the banked ship "... due to health and insurmountable contradictions," Director General
Ivan Redman hastened to retire. and Rhys Krauter (Reece Crowther) - on the right
In the course of a journalistic investigation, it turned out that the stand at the CES technology exhibition, thanks to which the company received a lot of endorsementand one of the 49 prestigious awards out of more than 20,000 candidates turned out to be fake in the sense that not one of the presented drones was not only to demonstrate the declared capabilities, but was actually not able to take off normally.
Along with a series of failures in the chosen marketing strategy and tactics, the project management successfully wasted the funds of the backers. The company spent a considerable part of the money on purchasing a batch of the latest models of powerful Mac computers and expensive gifts. So, according to information received, Torquing management bought an expensive BMW for the son of one of the investors who had neither direct nor indirect relation to this project on Kickstarter.
The demo video advertising the drone on Kickstarter also turned out to be fake. The video was edited in such a way that the viewer had complete confidence in the unsurpassed functionality of ZANO. In fact, the drone for the entire time of testing and existence has not left the limits of a small room. Currently, the British authorities are scrupulously studying the record in order to be able to assess how much the conducted advertising campaign was a deliberate and planned deception of buyers.
The latest official information, somewhat encouraging Kickstarter investors, was received in mid-October 2015 and stipulated a postponement of delivery dates to February 2016.
Some of the dissatisfied customers who made payments through PayPal were able to withdraw their funds at an early stage of production. This was made possible thanks to the practice of the Buyer Protection Program , according to which the service returns money to the buyer if the seller’s obligations for the order are not fulfilled.
One of the reasons mentioned is an incorrect calculation of the production cost and the announced price of the drone. Based on the data presented as part of the campaign, even if each customer had a working device, the company would still be in the red. According to data provided by Harris, the amount of direct and indirect losses of the company in excess of the amount invested by Kickstarter backers amounted to $ 1.4 million.
So, the ZANO project became a classic trap for the Touring Group, when the latter took on significantly more obligations than it was able to master. Moreover, according to the results of the investigation, Harris claims that the intentions of the team can hardly be called frankly fraudulent. On the part of the company’s management, everything that happened was the result of the extremely irresponsible attitude of the Touring Group management towards the funds raised and the complete inability to plan the budget.
One of the parties that are most directly related to the conflict, according to Harris, is the platform itself, which should carefully select the projects that are allowed to conduct an advertising campaign. For Kickstarter, as well as for the industry as a whole, the ZANO experience is an excellent lesson in identifying ways to improve the quality and safety of customer service. The rules of the platform, the journalist believes, should more clearly and unequivocally convey to potential backers that any company on the site is nothing more than raising funds for the development of the project, but not a guaranteed pre-order of the advertised product. To improve the quality of the portal’s work, he proposed attaching special mentors from among authors who have already successfully implemented their projects on the platform to promising companies that are announcing their products.
After such a massive and high-profile failure, Kickstarter CEO Yancy Strickler was forced to agree that the platform should organize a support system for users affected by such a development.
You can learn more about the opinion of Mark Harris on the pages of his blog .
Our other articles and events
Recall that at the end of May 2015, the Torquing Group team announced that the project was successfully moving to completion. According to Reece Crowther, marketing and business director of the ZANO project, the supply of drones was supposed to start in June-July 2015. In addition, the company published two encouraging demos showing the drone in action, and shared the details of the final development phase. Torquing Group's weighty trump card in attracting investors was a fairly rich track record of a company that has successfully worked on the development and production of drones for military purposes. At the same time, the quality of the products fully corresponded to the specific strict requirements of the military-industrial complex.
In fact, for project investors, the situation developed extremely unfavorably. When a BBC journalist visited the company’s office in August 2015, he learned that the drone is not able to take off outdoors and somehow only moves indoors. At the same time, the battery lasted for only 5 minutes of flight. It is clear that no successful shooting of streaming video and broadcasting it to smart devices within 15 minutes, selfie photo and support for image stabilization, wireless charging capabilities, upside-down flight, support for thermal imaging cameras and other promising, very delicious “pies” "Promised in the framework of the advertising campaign in this case we are not talking.
The July shipment promised to the Beckers Kickstarter did not take place. Instead, several hundred “barely alive” drones at the end of September were sent to the “lucky” of the 3,000 customers who paid for the drone through the project website. This caused a flurry of just indignation from loyal Kikstarter backers who had paid ZANO earlier.
At the same time, buyers from the ZANO website, who still managed to get drones, were literally shocked by the level of quality and extremely disappointed with the capabilities of the product. According to the description: the flight of the drone was reduced mainly to its rise above the horizontal surface by several centimeters, hovering in the air for some time, followed by a complete loss of controllability and the “flying” of the device into the wall. There was no need to talk about the quality of the video, nor about the promised possibility of enveloping obstacles, controlling with gestures and, moreover, completely autonomous flight.
Some of the affected beckers created an initiative group and even published a petition on change.orgdemanding to refer the case to the Arbitration Court and recover costs incurred from the project organizers. The text of the document states that the information provided at the level of advertising and video was knowingly false.
In mid-October, the date of the proposed delivery of ZANO to kickstarter beachers was once again shifted to February 2016, and in November CEO Ivan Ridman left his post “... for personal reasons and irreconcilable differences”. “Ax fell” and in parallel with the events described, the company management declared bankruptcy, liquidation of the business and sale of the remaining assets of the company due to accumulated debts. After these events, the former Touring Group administration ceased all cooperation with the Kickstarter platform, which is supposed to be the platform’s regulation in the event of a project failure.
As noted by the BBC in connection with the events, attempts to contact the executive director of Torquing Group Philip Busby (Philip Busby) but they did not contribute to clarifying the situation - no comments were received from him.
Certain attempts to get away from what was happening and made official representatives of Kickstarter. So David Gallagher in this regard stated the following: “Project organizers who want to produce and supply hardware are required to publish a demo with a functioning prototype of the device on the website page of their project. Thus, the creators are independently responsible for their projects, and the backers decide whether to fund them. ”
Nevertheless, the scale of investments and the number of project participants involved by the Touring Group administration in the ZANO project did not allow Kickstarter to limit themselves to standard unsubscribes. In order to clarify the circumstances surrounding the collapse of the project Kick was hired freelance journalist Mark Harris ( the Mark the Harris ), known for its publications in popular publications like The Guardian, The Economist and Wired.
The reasons for the failure of the ZANO drone project on Kickstarter according to journalist Mark Harris
Today, when the results of the investigation of the independent journalist Mark Harris are already known, it can be confidently stated that the collapsed ZANO mini-quadrocopter project advertised on the Kickstarter site by Torquing Group has become one of the most dramatic startups in history in terms of investment, number of backers and the scale of deceived expectations. crowdfunding industry. The collected materials allowed the journalist to name the main reasons that led to such a dramatic ending ...
At the time of the launch of the campaign on the platform, the Torquing team already had about $ 282 thousand, and most of the funds were invested by a British businessman who lost a total of about $ 353 thousand in this marathon. Moreover, the Kickstarter campaign was “fatal” ”Successful. As a result of the multiple excess of the amount of funds received in comparison with the original goal ($ 190 thousand), the Touring Group team was literally “inundated” with orders, which they failed to provide quality, timely service physically, technically and “psychologically”.
Such a rapid development of events and the omission of a series of deadlines previously agreed upon by Kickstarter caused a panic in the development team. Instead of starting with small test batches, gradually expanding production with a focus on quality and testing, Torquing began mass production of the crude product.
Despite the loss of control over the situation, the leadership hid the true state of affairs from subordinates and partners. So it was possible to find out that the two leading component developers had no idea how negatively the real scenario was developing. Moreover, their ignorance took place until the moment when it was no longer possible to hide the true state of things, because from the banked ship "... due to health and insurmountable contradictions," Director General
Ivan Redman hastened to retire. and Rhys Krauter (Reece Crowther) - on the right
In the course of a journalistic investigation, it turned out that the stand at the CES technology exhibition, thanks to which the company received a lot of endorsementand one of the 49 prestigious awards out of more than 20,000 candidates turned out to be fake in the sense that not one of the presented drones was not only to demonstrate the declared capabilities, but was actually not able to take off normally.
Along with a series of failures in the chosen marketing strategy and tactics, the project management successfully wasted the funds of the backers. The company spent a considerable part of the money on purchasing a batch of the latest models of powerful Mac computers and expensive gifts. So, according to information received, Torquing management bought an expensive BMW for the son of one of the investors who had neither direct nor indirect relation to this project on Kickstarter.
The demo video advertising the drone on Kickstarter also turned out to be fake. The video was edited in such a way that the viewer had complete confidence in the unsurpassed functionality of ZANO. In fact, the drone for the entire time of testing and existence has not left the limits of a small room. Currently, the British authorities are scrupulously studying the record in order to be able to assess how much the conducted advertising campaign was a deliberate and planned deception of buyers.
The latest official information, somewhat encouraging Kickstarter investors, was received in mid-October 2015 and stipulated a postponement of delivery dates to February 2016.
Some of the dissatisfied customers who made payments through PayPal were able to withdraw their funds at an early stage of production. This was made possible thanks to the practice of the Buyer Protection Program , according to which the service returns money to the buyer if the seller’s obligations for the order are not fulfilled.
One of the reasons mentioned is an incorrect calculation of the production cost and the announced price of the drone. Based on the data presented as part of the campaign, even if each customer had a working device, the company would still be in the red. According to data provided by Harris, the amount of direct and indirect losses of the company in excess of the amount invested by Kickstarter backers amounted to $ 1.4 million.
So, the ZANO project became a classic trap for the Touring Group, when the latter took on significantly more obligations than it was able to master. Moreover, according to the results of the investigation, Harris claims that the intentions of the team can hardly be called frankly fraudulent. On the part of the company’s management, everything that happened was the result of the extremely irresponsible attitude of the Touring Group management towards the funds raised and the complete inability to plan the budget.
One of the parties that are most directly related to the conflict, according to Harris, is the platform itself, which should carefully select the projects that are allowed to conduct an advertising campaign. For Kickstarter, as well as for the industry as a whole, the ZANO experience is an excellent lesson in identifying ways to improve the quality and safety of customer service. The rules of the platform, the journalist believes, should more clearly and unequivocally convey to potential backers that any company on the site is nothing more than raising funds for the development of the project, but not a guaranteed pre-order of the advertised product. To improve the quality of the portal’s work, he proposed attaching special mentors from among authors who have already successfully implemented their projects on the platform to promising companies that are announcing their products.
After such a massive and high-profile failure, Kickstarter CEO Yancy Strickler was forced to agree that the platform should organize a support system for users affected by such a development.
You can learn more about the opinion of Mark Harris on the pages of his blog .
Our other articles and events
