“New Year’s Greetings: thanks for your money, but no Jolla tablet for you!”
That is essentially the message in a New Year’s blog post by Jolla, the Helsinki, Finland-based company that raised $2.5 million in an Indiegogo campaign to fund development of a new computer tablet, the Jolla tablet.
In a blog post entitled “New Year’s Greetings from Jolla!” dated December 31, 2015, the company pointed out that it would ship a small batch of Jolla tablets to early backers in 2016. But Jolla went on to break the news that it probably wouldn’t be able to send all investors a Jolla tablet:
“The bad news here is that we are not able to complete the production to fulfill all contributions. In other words, all of our backers will not get a Jolla Tablet. However, you can be sure you will not end up empty handed. We might even have some positive surprises in stock for you. But more on that will follow, feel free to speculate!”
Investors are indeed speculating in the comments — and it’s not pretty.
The blog post stunned and angered investors. And they are being outspoken, some openly fearful that their investment will be lost. For example, one investor used profanity to express displeasure, and others vaguely suggested legal action. Others were unhappy about the possibilitiy that instead of getting a tablet, as expected, they would get some sort of consolation prize.
Writes an investor identified as damien.vanderbijl:
“Whatever it is you’re thinking about, it better not be another Jolla Phone. Most of us already have one or more. Also, we were given to understand that the meeting ‘after Christmas’ would give us the answer. The options on the table were finishing the tablet project or refunding. The refund option is now apparently off the table?
And honestly, it is rather inappropriate to write ‘feel free to speculate’. Firstly, we don’t need your permission to speculate. Secondly, we’ve been speculating far too long now for lack of real information. Personally I’m done with that.”
Yet some investors are more philosophical about the Jolla situation. An investor identified as koenig writes:
“The campaign was explicit in that there was no guarantee for a delivery. We all went in to this with open eyes, did we not. It was a gamble with a certain risk and I for one was fully aware of it. Yes, it sucks if I not get a device but I knew what I got myself in to. The pros and cons of crowdsourcing are as Lemmy put it: “You win some, lose some, all the same to me, the pleasure is to play”
The jousting continues on Twitter. One Twitter user writes:
Despicable @jolla crowdfunded w/claims tablet was #opensource—when it was not— but now givers don't even get tablets https://t.co/dahVyZvcsY
— Patrick Masson (@massonpj) January 4, 2016
Jolla raised $2.5 million in an Indiegogo campaign that achieved 480% funding in 2014. The campaign was closed in September 2015.
At the time of the campaign, the company billed its device as the “first crowdsourced tablet.”
The campaign generated over 21,000 investors, many of whom paid between $250 and $350 each. Investors were to receive one of the new tablets.
Jolla ran into trouble in late November 2015 as well. A key investor pulled out in a C round of funding and the company was forced to temporarily lay off most of its small staff. The company says it is now on better financial footing despite not being able to follow through on its commitment to crowdfunding investors.
More in: Crowdfunding
No matter how they phrase it, it doesn’t sound good for investors. It’s a promise broken no matter how you look at it.
Even in crowdfunding, a key part of investing is a risk of loss. If that risk didn’t exist, it would simply be a purchase rather than an investment.
This illustrates the dangers of crowdfunding platforms like IndieGoGo and Kickstarter. The fine print clearly says you have no legal recourse if the project doesn’t deliver. People need to go in with their eyes wide open. Even the largest projects that get funded way above goal aren’t immune.
The fact that project failed is not the source of our ire, it’s the fact that Jolla has been silent and in some cases flat out lying about the progress of the tablet project. A lot of the information that backers discovered about the project came from 3rd parties (Media outlets), you can see the investors really starting to turn on the company starting in late summer, and it’s all Jolla’s fault, their lack of communication has flat out destroyed the good will and community support they once had. I understood the risk of crowdfunding, but I least expected to not be treated like a child during the project.