Matthew, Welcome to the forum. I hope you find lots of helpful information in the many posts.
As Dan states in the first post in this now very long chain as well as the email that was sent to all pre-order backers.
This email was sent to all pre-order backers on 4/19/2016, and is copied here for discussion and future reference.
We have a lot of news. So much so, I’m going to start out with a short summary before I get into the details.
Due to schedule delays, we plan to ship your Glowforge by December 2016 (for orders placed during the 30 day pre-order campaign) or March 2017 (for orders placed subsequently) instead of our original date of 2016. New orders will ship after yours.
We feel terrible about this delay, and by way of apology, we are including $200 of extras.
Your Glowforge will ship with $150 worth of Proofgrade™ materials as a free bonus.
Your preorder will include a $50 gift certificate to the Glowforge design catalog.
You will receive Glowforge Founder status.
Your Glowforge Founder status entitles you to a 10% discount on all catalog and materials purchases.
I have been reading the complaints on this post for the last few minutes and I have to say that I am a little confused at several of them. I thought it would be taken for granted that there would be delays in the production. Maybe it is my experience with being a crowd-funding supporter and a product development engineer, but no one should base their business off the delivery date of a product that has not been fully developed and tested. Anyone who does that is asking for problems.
Anyone who is basing a business off a product that isn’t proven better have a backup plan that will take over in the event that the primary plan doesn’t work. Even if you have only one proven unit, you better have a backup plan. Things happen. Mechanical devices fail. These are facts of life and no one is exempt.
Glowforge is making a product that pushes the envelope in several ways - this is cutting edge technology. Until it is commonplace, you have to expect that it will be delayed. Glowforge has gone above and beyond to make this dream a reality. As several people have pointed out, they didn’t need to offer discounts or free stuff. Give them a break. If you can’t, take your refund with class and style.
I understand the disappointment that we all have had when the deadline got pushed. What I can’t understand is that it was a surprise to anyone. This is not meant to be a comment on the dedication of the Glowforge team, quite the opposite, just on what happens in life. New product = problems = delays.
I also had a product plan for the Glowforge. I decided not to enact or depend on that plan until I had it in place and I had experience in running the product because my experience tells me that you never depend on anything that you haven’t learned to use and tested on your own time. Once you are confident in your ability to work a device and able to make sure that if it fails you can either repair it in a timely manner or have a backup in place and confirmed, then you can depend on it for business.
Kudos and compliments to Glowforge for continued honesty, transparency, and support for their customer base. I am certain that when the Glowforge ships, it will be an amazing machine and worth the wait. That shipment notification will be a wonderful day. Until then, let’s all support Glowforge in a positive manner. They have apologized over and over again and they don’t need do spend time and energy doing it any more.
That’s a very nice sentiment, but speaking from personal experience, in the real world where the big boys play it just does not work like that and I’m sure inside Glowforge it doesn’t work like that either. My guess is that, at Glowforge behind closed doors, the founders and their equity backers are always concerned that someone else may clone their idea/technology implementation before they get soundly entrenched as “the player” in the space. This is a big deal for the investors as it impacts both their short and long term investment objectives. Their business plan is definitely not to “enact or depend on that plan until”. . . I firmly believe the only place that laissez faire business concept exists is on the consumer side of crowdfunding. Henceforth I will refer to it as CrowdVille (giving credit to Dilbert’s Cubeville). Unlike Angel Invetors, we the residents of CrowdVille are entranced by “shiny”. While I think it fair to say that Dan sincerely wants to see a Glowforge every home in CrowdVille, I do seriously doubt the same can be said to be one of the primary objectives of the Foundry Group.
I believe that @ben1 is referring to purchasers of GF who made business plans based on obtaining Glowforge by a specific date. (e.g. if a user pre-sold laser cut wedding favors to be delivered in July, they are now going to have to determine another way of producing said favors or cancel the order.)
I am referring not to Glowforge but to the customers who decided to base a product and a business plan on a device that had not been released and tested.
Glowforge has a plan built on their product, but no one should depend on the Glowforge to make money until their Glowforge is in their possession and has been proven to be able to make the product and manage the throughput that their product and customer base requires.
Yes, I understand what you are saying. What I am saying is this that CrowdVille, is the only place I can think of where businesses intending to use a product in their business are constantly told, “don’t hold your breathe or make any plans for the use of our product in your business, but give us you money”. CrowdVille is the only place in my +/- 30 years in business/finance where I have seen this phenomena.
I’m not speaking of Glowforge here but rather the crowdfunding space in general.
You are correct, because crowdfunding is the only finding source where consumers, be they private or business, are given the chance to purchase a product before it is complete and tested. Traditional product development relies on either a customer who plans for the product and pays for it to be developed to their specifications or a company who develops the product with a certain need in mind and obtains funding through other sources.
The challenge with Crowdfunding is that the Crowd has members who don’t understand the process and don’t have the patience to wait for it. This is obvious in KickStarter and IndieGoGo, where backers treat the service like an advance order store and not as a risk. There is no guarantee of delivery with any product under development. While I feel it is unlikely in the extreme, Gowforge could pull a bunk and walk away tomorrow. This is what the Crowd seems to not understand.
And my point is that the Crowd needs to not put their livelihood on the line for a product that may be delayed or cancelled.
I think this happens in conventional business too, just usually not on this timescale. Think of all the big and small software projects that have blown their launch dates. Or the times the supplier calls and says “Yeah, I know I said we had some in our other warehouse and would deliver tomorrow, but how about sometime next week…”
Wait !! You’re telling me that everything I read on the internet isn’t true? You mean the internet committe doesn’t personally investigate and confirm everything before it can go into the “web”. Nooooooo… (well if Lincoln did’t kill those zombies back then - who diid?)
Happens in vertical software markets a lot. One or more customers pre-fund the development of a software application so someone will build it. Software vendors often have 100 competing potential places to spend their time & energy on. Customers often have real business needs for software. The vendor won’t build it if there isn’t a proven market and often won’t be willing to risk building on spec to find out that no one wants the product they just spent time & money building (people saying "if you built it I’d buy it doesn’t make a market - can’t count on them not backing out).
So sometimes one or more customers will prefund the development costs so the vendor has a guaranteed ROI. No customer wants to prefund say $1M but by getting 3 others together they each only have to pay 250K and they get what they want and the vendor has their costs (at least) covered.
My experience was quite different. I spent most of my career in the commercial real estate development and construction market. Typically goes like this. You enter a design build competition. If you achieve the spec and provide the lowest net effective rent you get the job. Now, along with that is a huge penalty if you do not have the building ready for occupancy on the contract occupancy date. HUGE penalties accrue for every day late. And understandable. We did a building for Nortel back in the day that was ~ 200,000 sq.ft that became 400,000. If we had been late there would be 3,000 - 4,000 employees that would be sitting on the curb until they could move into their new digs. They can’t deliver on their customer commitments because they have no commercial space to work out of. It’s a big deal.
On the sub-contractor side, if they were late on delivery, they were penalized by us. While it was our responsibility to coordinate that concrete pours went in in conjunction with electrical and mechanical and floor by floor, etc. But if one sub is late every sub gets their schedule pushed back. Again, huge penalties for a sub when they are late and put everybody behind the 8 ball.
Now I guess it doesn’t matter much today as Nortel’s gone with the wind. But back then, late delivery was a big deal for everybody involved.
Still is. In my world (software) I just invoked a 100K penalty on a 500K project for a vendor who was late. In construction, our capital city (CT - Hartford) was building a new minor league baseball stadium. They just missed their date (after getting another 20% in increased $) a couple of weeks ago, the baseball team is wandering the country playing games (the stadium they’ll use for the “home” games until the new stadium is built is different every month). The city just invoked late completion penalties (which the developer agreed to in return for the concession on the additional dollars) - 50K for the first day and 15K for every day since. The contractor said “maybe another 60 days” so the city terminated them yesterday and called the surety bond. Not looking good for anyone now.
The difference here being the contractual obligations between the client and the contractors. Glowforge doesn’t have any contractual obligations to hit any deadlines for us. We funded the development of the product we didn’t sign anything that obligates them to stick to the timeline they layout.
It is my understanding that the Glowforge pre-orders did not fund development as normally understood, just indicated what kind of production run was needed. Where that pre-order money is parked and what’s happening to it, I would love to know, but I have a feeling that it isn’t being touched until products start being delivered.
(well if Lincoln did’t kill those zombies back then - who diid?)