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Circuit Breaker

An AI alarm clock company raised nearly $1 million on crowdfunding and went bankrupt

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The backers want their money back

Image: Holi

After raising nearly $1 million on crowdfunding platforms to build an AI-powered alarm clock, the French hardware startup Holi has filed for bankruptcy without shipping products to the vast majority of its backers. Out of the nearly 7,000 owed units, only about 1,000 shipped. Those that did will cease functioning on February 1st when Holi says its servers will go down. The Verge’s messages to Holi went unanswered.

Holi ran campaigns on both Kickstarter and Indiegogo in late 2016 to bring the clock, called Bonjour, to life. The project was supposed to put typical smart assistant features, like weather, calendar syncing, and music playback, inside an adorable bedside clock — something that was unique at the time.

Now, Holi has announced that it’s being liquidated. Its assets will be sold off, its money will go to pay back debts, and employees have been let go.

Understandably, backers are unhappy. Some have organized in a Facebook group where they’ve discussed reaching out to the liquidator in an attempt to recover some of Holi’s assets and make the product open source. Others hope they can reverse-engineer the Bonjour in the meantime to then host it themselves.

A post from a Bonjour-backer Facebook group.
A post from a Bonjour-backer Facebook group.

Holi issued a pair of updates blaming the shutdown on a variety of factors, including underestimating the company’s budget and an inability to technically asses suppliers’ components. It also clarified that none of the raised funds went toward other in-development products.

“All the money was spent to create Bonjour, and our company invested all of its own financial resources,” the team wrote. “We are honest people who deeply believed in Bonjour and dedicated their last two years to this project.”

Holi’s incident further shows how failed projects are especially problematic for backers. No one will receive a refund, and the only insight they ever had about the campaign’s failure was from the creators themselves and through updates on both Indiegogo and Kickstarter.

In a statement to The Verge, Indiegogo says its Trust & Safety team is reviewing the campaign to make sure it didn’t violate any of the platform’s Terms of Use. “Ensuring backers receive their perk is our top priority, and that’s why we’re constantly innovating to help entrepreneurs in delivering on their promises,” the company says.

In this case, both Google and Amazon sell similar devices to Bonjour, which might be good news for these backers. But for now, they’re out more than $100 for a device that never made it to their door.