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Circuit Breaker

One Kickstarter campaign allegedly had $100,000 stolen, but still shipped its keyboards

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Keyboardio

In our monthly Rise and Fall column we look back at crowdfunded gadgets that reached their funding goal. Months or year later, how are they doing? If they’ve shipped to backers, are they still supporting the gadget? If they haven’t shipped, why haven’t they met their shipping deadline? We hope this column will give us all a place to understand.

On its quest to make a “better keyboard,” Keyboardio raised more than $650,000 — then found itself scammed out of $100,000, according to the company’s founders. It could have been an existential problem for such a small company, but Keyboardio has managed to weather the setback and now has advice for others on how to avoid running into the same scam.

What’s today’s gadget and what does it do?

The funky-looking Model 01 keyboard is composed of two separate pieces, so users can customize the setup to their liking. The company says it’ll take time to get used to typing on this keyboard, but the payoff is supposed to be a more enjoyable and comfortable typing experience. It’s made of solid maple, which the company says makes it feel “more like a musical instrument than a computer peripheral.”

What happened after funding? Did it ship?

The keyboards took a while to fully reach backers. Keyboardio promised delivery in 2016, about a year after launch, but wasn’t able to start shipping until 2017. The company says it finally finished shipping Kickstarter preorders early this year, three years after the campaign. It took new preorders while working on the Kickstarter fulfillment, and all of those have now shipped, too. Co-founder Jesse Vincent tells The Verge that the company has shipped “thousands” of keyboards.

After shipping to Kickstarter backers, the team kept producing keyboards, but ran into a new struggle that it wasn’t expecting: the Chinese factory’s Director of Overseas Sales had left the company, but didn’t tell Keyboardio, ultimately stealing $100,000 from the team, Vincent and his wife / business partner Kaia Dekker say.

This woman allegedly told the factory that Dekker and Vincent were broke and couldn’t pay for the keyboards. In actuality, Dekker and Vincent say they were paying, but this woman stole their cash by creating fake invoices to deposit money into her own accounts rather than the factory’s.

The factory had received deposits from Keyboardio, and it wasn’t until their contact failed to pay one of the installments. THE company caught onto the alleged scam when the factory didn’t ship the next batch of keyboards. Dekker and Vincent say they might seek legal action and the return of their funds. That’s a long-term journey, though.

The creators’ relationship with their factory is seemingly mended, and keyboards are available to buy online now.

Keyboardio

What are backers saying?

Generally, backers seem to be happy, although they say it took a while to get used to the keyboard’s split layout. Vincent responds to most backers, especially if they have a concern.

What does the company have to say?

Vincent and Dekker say there’s one thing they could have looked out for to catch the fraud earlier: a seal. In China, factory invoices are supposed to come with a factory-specific seal on them called a “chop,” Vincent says. It’s a way of saying “this officially came from the factory.”

Someone can always buy a fake seal, so Vincent says even keeping an eye out for the chop wouldn’t have necessarily saved Keyboardio. However, it’s something he and Dekker will keep in mind going forward. The team also says having someone on the ground in China can help, although Dekker doesn’t think there’s a “silver bullet single solution” that would have prevented their loss.

Luckily, they say, the lost $100,000 didn’t kill the company or negatively impact their backers.

“From reading the responses that our backers have written us both privately and publicly, they seem to understand what we’re telling them and seem to be very much on our side,” Vincent says.

As for broader advice, Dekker says small hardware makers should always “have a cushion” of cash because something will inevitably go wrong. “It’s not always going to be hundreds of thousands of dollars stolen, but there’s going to be delays. Everything is going to take longer and be more expensive than you think it is,” she says.

Update, December 22nd 2:07PM ET: updated with clarifications from Keyboardio.