Glowforge announces $22 million in financing

[dan]

@szara

It is disappointing to read (at this late stage) that Glowforge needed more funding in order to just now begin distributing beta units!

I apologize for being unclear: we did not require any additional funding to deliver beta units or for any other purpose.

@szara

Why couldn’t the $27+ million (crowd funding) and the $9 million (initial private funding) be used for this?

We prefer to use investor dollars to operate the company, not the funds you paid us. Should something happen to us, that means your funds would still be unspent and available for refunds.

@szara

Oh, we discovered some issues that have to be corrected, so we need more time in order to ship you the best product !

I hope that does not occur, but you’re quite right that it’s possible: if we find problems, we will postpone and accept that many people will want refunds, rather than ship a product that is substandard. As I’ve always said, shipping on time is the second most important thing to us, second only to shipping the high quality product you paid for and deserve.

@szara

I am tempted to cancel my order and use my money more productively on other tools that I can put to use now!

I’d understand and we’d issue you a full refund right away if that’s what’s right for you.

@szara

Dan has been asking the community to suggest features they’d want included in the laser

Please ignore that request if it causes you upset or frustration.

@MikeH

Just a guess, but maybe GF and investors are now seeing units working so well that they foresee demand for GFs after release increasing substantially and want to be ready to ramp up production quickly.

Quite true. If we know that we can pour resources into building a sustainable business after we complete your orders, then everything is made easier: we can spin up the production lines to higher volumes, we can negotiate for higher quality components for the same price, etc.

@Jules

Investors do not hand over money out of the goodness of their hearts

Very, very true. Although a quick google of Brad Feld will show that he is, indeed, a hell of a guy with a heart of gold - but not someone who will invest in a bad deal.

@szara

So how can I be confident that the initial features are working?

I understand your concerns. As we begin shipping large numbers of units, you’ll have a chance to read reviews of the product and see for yourself. You’ll also have the option of deferring your shipment (for example, if you’re early in line, and want to see what others say first) for later.

I don’t think you’ll be disappointed, though!

@printolaser

I know (in my heart) that Tony betas the sh!t out of one continuously! I would be surprised if the designers on staff weren’t in the foxhole too.

You have no idea. @Nick and @shell log the most hours by a long shot, but it’s a hot competition among the company for 3rd place. Not technically beta, though, since that refers to outside-the-company.

@jdodds

they no doubt had to hand over a lot more upside value than the value of the round 2 funding.

While we haven’t announced the economics of this round, we were happy to have the company valued much more highly than it was last time, so our equity dilution was lower.

@jdodds

There can be a minus of Foundry Group et al jumping in, in that they have WAY more equity now and WAY more control (I’m guessing here).

Not an unreasonable supposition, but we did not in fact add any board members (still just Brad and I), nor was company control meaningfully impacted in this round. More importantly, we chose Brad as a partner from the start because he’s legendary in his support of companies doing what they believe to be right, even - and in fact particularly - when it flies in the face of the investors’ short term self interest.

@printolaser

So it wouldn’t surprise me if the founders sold out and prepared themselves to feed on the addictive adrenaline of the next venture.

There was a great Zuckerberg line about ‘if I sold Facebook, I’d just start another social network’. Who knows what the future may hold, but - this is what I’ve dreamed of doing, in one way or another, since I was 18 and first discovered lasers.

@laird

I’ve VC-funded and sold two companies, and if you can raise money when you don’t “need it” you get a much better deal than if you wait until you “need it”, because when you need money the investor knows it and has more deal leverage.

Nailed it.