The Peachy Printer - The First $100 3D Printer & Scanner! ...has imploded. - Page 1
Forum section: electronics / general

author: sswift
author_rank: Contributor
timestamp: May 11, 2016, 12:10:04 pm
content: https://www.kickstarter.com/projects/117421627/the-peachy-printer-the-first-100-3d-printer-and-sc/posts/1572573Long story short, all the money was deposited into one of the founder's bank accounts, that guy embezzled over $300K of it to build a house, and the company has been forced to lay off its workforce.

author: nowlan
author_rank: Frequent Contributor
timestamp: May 11, 2016, 02:36:43 pm
content: I saw the thread on reddit.com, but didnt watch the video.Surely there must be some lawsuit that can recover funds. Sell the guys house, and refund backers.

author: sswift
author_rank: Contributor
timestamp: May 11, 2016, 04:30:13 pm
content: Problem is the house is only a third of the way done and is presently not even worth what was spent on it.Also it was explained to me that what happened, or what the guy's plan was anyway, was that he was supposed to get a loan from the bank to build this house, and he spent the Kickstarter money on it to begin construction with the intent of paying it back with the loan proceeds, but the loan fell through due to construction falling behind schedule.I doubt a lawsuit will be able to recover much from these guys.

author: ferrix
author_rank: Contributor
timestamp: May 11, 2016, 04:40:45 pm
content: The inventor had some interesting ideas for improving limitations of resin curing printers. I was looking forward to seeing how this affected the rest of the market. Too bad it did this.

author: Jeroen3
author_rank: Super Contributor
timestamp: May 11, 2016, 04:41:44 pm
content: Only one way left. Finish and sell the house.

author: edy
author_rank: Super Contributor
timestamp: May 11, 2016, 05:24:57 pm
content: He should have 3D-printed the house!

author: station240
author_rank: Unknown
timestamp: May 16, 2016, 12:52:02 am
content: *sigh* banksI've watched enough episodes of various UK tv shows where they turn an old house/barn/water tank into a home to know how this happens.Bank won't lend you the money until the house is structurally sound and water tight, but of course getting it to that stage is most of the cost.So the owners borrow from friends, rack up debt on the credit card and take out a bridging loan. No prizes for guessing who makes money from those last two sources.I'm not sure I'd trust a $100 3D printer, as even the $3000 one I looked at last year had issues. I wish them luck.Short of going out to finish the idiots house themselves every weekend, I don't see any quick solution to this.Moron should have built a smaller house.

author: Corporate666
author_rank: Unknown
timestamp: May 16, 2016, 04:53:42 am
content: The "CEO" guy in the videos is also to blame.I can sort of understand his desire not to publicize the issue a year ago when it happened, however when he made that choice, he also made the choice to take on some of the responsibility for that decision. He also wants to deflect all blame to the guy who stole the money - but he bears responsibility too. It does not take long to set up a bank account, it can be done easily within a day in most places. And when it became clear the quantity of cash was many hundreds of thousands of dollars, he had a fiduciary duty to act in a suitable manner - which he completely failed to do by not becoming at least a signatory to the bank account and by not setting up a separate business account immediately, and by not maintaining oversight on that cash."That guy ripped you off - so we can't deliver" is a hollow excuse.

author: Kalidor
author_rank: Regular Contributor
timestamp: May 16, 2016, 04:47:49 pm
content: They asked for CAD 50000, got almost a million, 300k was stolen, 100k payed back.So they used 736k+, 550k of it during 2013, 2014. It's a wonder that they managed to survive until today. Maybe even with these 200k they would be gone bankrupt a year later.Not the best video but some background info:https://youtu.be/Ain1y9_ZLuo

author: uncle_bob
author_rank: Unknown
timestamp: May 16, 2016, 11:27:07 pm
content: Quote from: Kalidor on May 16, 2016, 04:47:49 pmHiIf you look at the "burn rate" on most of these companies, it goes up significantly year over year. The closer they get to a real product, the more people they need. They also fund tooling and first run parts costs. A pattern like $X first year, $2X second year, $4X third year is actually fairly modest. I doubt that another $200K would have kept the doors open for very long. Since they already blew through their original estimate ... the $200K isn't the issue. Not having a clue how to get the product to market is the real issue.Bob

author: EEVblog
author_rank: Unknown
timestamp: May 16, 2016, 11:36:08 pm
content: WTFIt's turned into a cheesy documentary:

author: EEVblog
author_rank: Unknown
timestamp: May 17, 2016, 02:49:04 am
content: Someone in the comments pointed out that the guy took 49.87% of the money, and he's a 50% owner in the company.Coincidence? seems unlikely. Legally he owned that money.Could be a very clever play. He could be off the hook on embezzlement, and being financial controller actually had say in how the rest fo the money was spent trying to deliver the goods. The CEO even admits they were very close to pulling it off, even with half the money gone. So it's likely going to be hard for the backer to take legal action for goods not delivered? The guy simply took half the money (his half) as wages and bonuses or whatnot.

author: CanadianAvenger
author_rank: Regular Contributor
timestamp: May 17, 2016, 03:00:19 am
content: I was about to say "Unbelievable!" But then I remembered this was crowd funding.

author: Corporate666
author_rank: Unknown
timestamp: May 17, 2016, 03:31:48 am
content: Quote from: EEVblog on May 17, 2016, 02:49:04 amThat's what I was alluding to in this thread (or was it the other one?).The backers have no claim against this David guy. They are not owners of the business, nor are they partners in any way. They are just backers, which is just a type of customer, but with less rights.If the story is true as presented, Rylan is the aggrieved party. But it doesn't appear he has really done much to solve this problem. He sucked out almost $400k in funds, David sucked out $200-300k, and only $80k was spent on materials and tooling.The video about illustrates that the pie chart wasn't even accurate - they had money from the gov't as well as family investment. And the video doesn't, AFAIK, include the Backerkit "pre-order" money. So it appears it was well over a million.So they spent 8% on actual tangible goods, they spent almost half a million on salaries, a founder absconded with $200k, and who knows where the rest went.And Rylan spent a lot of time (too much time, IMO) creating all sorts of charts, videos, reaction videos with backers and other content to absolve himself from any liability or blame.I wonder how much he, personally, took out of the company? I wonder if that family loan was paid back, and at what interest rate? The Canuckian gov't really needs to investigate this one. I smell fraud (either willful or otherwise) all over it.

author: edavid
author_rank: Super Contributor
timestamp: May 17, 2016, 03:38:00 am
content: The bad founder was not entitled to take half of the backer funds unless he was going to build half of the printers.The salary expense in the pie chart includes what was paid to several employees. I don't think it's been stated how much salary went to the founders.

author: uncle_bob
author_rank: Unknown
timestamp: May 18, 2016, 12:30:03 am
content: HiWas the pie chart audited? If so by which well known audit firm?Bernie Madoff had some wonderful financial pie charts / statements. They even had an auditor's signature on them .... none of it bearing any relation to reality.Bob

author: Corporate666
author_rank: Unknown
timestamp: May 18, 2016, 06:45:29 am
content: Quote from: edavid on May 17, 2016, 03:38:00 amHe might actually have been entitled to take it. It depends what the ownership structure of the company is, what contracts are in place, who are authorized signatories on the bank accounts, etc.

author: marcan
author_rank: Regular Contributor
timestamp: June 05, 2016, 10:12:28 am
content: Quote from: PeachyPrinterI could've told them that. In fact I did tell them that on the original thread here. How does it take "a lot of resources" to realize that you cannot control galvos accurately (down to DC frequency) with a random AC coupled line-out jack on a random laptop? Heck, the audio out jack on my Chinese barebone laptop (which is otherwise excellent) can't even drive headphones without massive LF rolloff because they undersized the AC coupling caps.Embezzlement aside, it seems they had some serious engineering fail going on.

author: EEVblog
author_rank: Unknown
timestamp: June 05, 2016, 11:15:50 am
content: Quote from: edavid on May 17, 2016, 03:38:00 amA private company owner is allowed to take whatever salary they like, even half if they so chose to.If a company takes in say $1M and thinks (and has a plan for) they can deliver to customers using only 100k of that money, there is nothing at all legally wrong with the owner(s) paying themselves $900k in salary. The rest comes down to regular consumer law about goods not supplied etc.

author: snoopy
author_rank: Frequent Contributor
timestamp: June 05, 2016, 11:18:18 am
content: Quote from: EEVblog on May 17, 2016, 02:49:04 amI don't get it ?? He's in this youtube video interviewing the dude that ran off with the loot ?? Why isn't he beating the crap out of him

author: Jasper
author_rank: Contributor
timestamp: June 05, 2016, 11:31:10 am
content: Quote from: EEVblog on June 05, 2016, 11:15:50 amCreditors can easily have a claim against the management/owners/board for gross mismanagement in such a case, though. There are limits to how limited your liabilities are in a limited liability company. Depending on jurisdiction, of course.Not that Kickstarter backers are creditors in any case.

author: EEVblog
author_rank: Unknown
timestamp: June 05, 2016, 11:38:22 am
content: Quote from: snoopy on June 05, 2016, 11:18:18 amYup, it's the most bizarre thing I've ever seen.

author: uncle_bob
author_rank: Unknown
timestamp: June 05, 2016, 11:38:36 am
content: Quote from: Jasper on June 05, 2016, 11:31:10 amHi... and there's the key. VC's might finance a company. You *might* get a bank interested in financing. In both cases, before you got a dime there would be contracts and forms to sign in one end and out the other. Regardless of your "limited" status, those contracts would tie you up pretty tight. It would not just be limited to your salary. Each time I've been through it, it includes minor things like "all your assets". A bankruptcy proceeding would leave you with more than those contracts. With Kickstarter, you still get a nice lump of cash to play with. It does not come with all those messy restrictions...Bob

author: EEVblog
author_rank: Unknown
timestamp: June 05, 2016, 11:40:52 am
content: Quote from: Jasper on June 05, 2016, 11:31:10 amBingo. They are just customers who didn't get their goods. But worse than that, they are customers who put in money in full knowledge that product did not yet exist and must be developed and there were risks in that.

author: edy
author_rank: Super Contributor
timestamp: June 05, 2016, 03:09:18 pm
content: And therein lies the biggest problem with crowd funding. Seems like the entire concept is designed to circumvent various business and legal processes which have been refined over many years to protect all parties involved. Let's throw all that away... This here new fangled Internet thingy is gonna teach them old timers how we do things better now, gad nabbit!

author: edavid
author_rank: Super Contributor
timestamp: June 05, 2016, 03:46:40 pm
content: Quote from: EEVblog on June 05, 2016, 11:15:50 amOf course, but there have been people looking at the pie chart and claiming that the "good" founder took *all* that salary himself, when in fact he hired and paid several other people out of it.

author: edavid
author_rank: Super Contributor
timestamp: June 05, 2016, 03:50:52 pm
content: Quote from: EEVblog on June 05, 2016, 11:40:52 amI don't think that's correct. If they ordered a product and didn't get it, they do have a claim. There are just not many bankruptcies where there is enough money to pay people that far down the chain.The idea that the crowdfunding backer agreement would shield the company from such claims has not been tested at all.

author: Kilrah
author_rank: Unknown
timestamp: June 05, 2016, 04:04:21 pm
content: Quote from: edavid on June 05, 2016, 03:50:52 pmAll major crowdfunding platforms make it pretty clear that you are an "investor" and not a "customer", and that you are not "ordering" anything, only subscribing to hopefully receive a perk as a thank you for supporting the project should it actually succeed. I.e. no guarantees of any kind for you, and no obligation at all for the project's creator.The only thing they may have to do if accused of fraud is showing a decently viable plan suggesting things had a non-zero chance of working out if they don't - and pretty much anyone can do that easily.

author: edavid
author_rank: Super Contributor
timestamp: June 05, 2016, 04:09:39 pm
content: Quote from: Kilrah on June 05, 2016, 04:04:21 pmWe've gone over this so many times- Backers are definitely not investors, because they have no chance in sharing in the possible success of the project creator.- The crowdfunding platforms assert that backers are not customers, but they don't get to decide that. It's a matter of law, which has not been settled (or even tested) yet.

author: uncle_bob
author_rank: Unknown
timestamp: June 05, 2016, 05:07:19 pm
content: Quote from: edavid on June 05, 2016, 04:09:39 pmHiIn a normal "we need money upfront" deal (regardless of what you call it) there will be a variety of protections in a contract. That's the way a million or two dollars normally trades hands. That's where most (99%) of the protection comes from. Crowd funding eliminates the contract. You then fall back on a bunch of laws that vary enormously from location to location. They were not written with this in mind. For the most part they date (at best) to the 1800's. Good luck untangling an international group funding snafu using them .... This all took place in one state didn't it?Bob

author: jancumps
author_rank: Unknown
timestamp: June 05, 2016, 09:23:58 pm
content: Quote from: EEVblog on June 05, 2016, 11:38:22 amExtremely bad acting too... My toes got in a cramp when I watched that video for the first time.

author: snoopy
author_rank: Frequent Contributor
timestamp: June 06, 2016, 12:07:16 am
content: Quote from: EEVblog on June 05, 2016, 11:38:22 amIf it quacks like a scam and walks like a scam then it must be a scam !!I bet that what they had was only a partially working prototype that was never going to work unless they poured tons of other peoples money into it. Somehow the dude who ran off with the loot knew it was never going to work so decided to cut his losses and enjoy the spoils

author: Corporate666
author_rank: Unknown
timestamp: June 06, 2016, 12:15:07 am
content: The founder of this thing (apparently) pulled off one of the greatest heists of all time. He has successfully absconded with the majority of the money while taking no blame whatsoever.There's nothing to indicate that if the rest of the money wasn't pilfered, that they would ever have delivered on anything. I'm dumbfounded that the backers of this thing are so easily distracted and fooled by a horrendously ill conceived and executed video.

author: EEVblog
author_rank: Unknown
timestamp: June 06, 2016, 01:22:19 am
content: Quote from: Kilrah on June 05, 2016, 04:04:21 pmExactly.There is no law against being incompetent at engineering and/or business finance.

author: EEVblog
author_rank: Unknown
timestamp: June 06, 2016, 01:27:39 am
content: Quote from: edavid on June 05, 2016, 04:09:39 pmCorrect. In Australia for example, we have decent consumer protection laws, and I suspect a crowd funding contributor will likely win if they the "perk" they backed was a deliverable product. A promise of a product is essentially a verbal agreement which is actionable under consumer law.Also, as far as the tax department is concerned in Australia, crowd funding contributions are not donations (nor investments), they are income from sales (because a promise was made on a specific product for delivery), at least for "reward" based crowdfunders i.e. a promised product.

author: snoopy
author_rank: Frequent Contributor
timestamp: June 06, 2016, 08:38:44 am
content: Quote from: EEVblog on June 06, 2016, 01:27:39 amThat should apply to churches and religious organizations as well because they are always trying to flog gold passes to heaven to the gullible in exchange for their material moneycheers

author: Kjelt
author_rank: Super Contributor
timestamp: June 06, 2016, 12:04:58 pm
content: Quote from: snoopy on June 05, 2016, 11:18:18 amMaybe he did, they did lock the door

author: snoopy
author_rank: Frequent Contributor
timestamp: June 07, 2016, 04:44:48 am
content: I watched his second video last night. If what he is saying is an accurate account of what has happened then he has been dudded big time and so have all of the contributors to this campaign !! I kind of feel sorry for him because it reminds me of some of the deadbeats I have dealt with in business in the past. There's nothing worse than dealing with a sociopath or psychopath especially in a business arrangement. They will tell you any lies and manipulate you in such a way that you are not aware of. In the end you will lose money and countless hours of your life which equates to money. I always say to people that if you really want to know what someone is really like then go into business with them and pretty soon you will find out about the real person behind the mask !!cheers