The title is super misleading.
They have only 150k in funding. I wouldn't attribute their bankruptcy to Google or FB.
E-scooter company goes bust after spending big on Facebook ads
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Re: E-scooter company goes bust after spending big on Facebook ads
#52Earlier quoted context omitted.
You sue the corporate officers, and it's up to them to find someone to defend them in court.
You can quite literally sue anyone for anything. But lawsuits aren't free, and the law isn't on the claimants side here, so they'd lose. So, sure, sue away it is just even more money lost and likely still no scooter or refund to show for it.
> the law isn't on the claimants side here, so they'd lose.
That's up to a jury, not an online forum.
Re: E-scooter company goes bust after spending big on Facebook ads
#53Ouch - 150K in a seed funding round from Y Combinator
Re: E-scooter company goes bust after spending big on Facebook ads
#54Earlier quoted context omitted.
You're not wrong, you're an idealist, which typically are very closely intertwined when it comes to reality. If you gave $700 to a company who promised to deliver you a scooter a few years down the line if all of the dominoes fell exactly as planned... I would argue that you got what you paid for even if it amounts to nothing tangible in the long run. Which is to say, you paid for a pricey digital lottery ticket with…
There’s large differences between bad luck, failed plans, mismanagement, and fraud. It’s optimistic to assume the best of the person who raised funds.
A misguided marketing strategy isn't fraud. That doesn't sound like deceiving people for personal gain by itself.
Unless the whole plan was to sell preorders and feigning failure in order to take the funds. But that's a serious claim and it could be grounds for an investigation if law enforcement was pressured. But it would take more than complaining about FB ads.
Re: E-scooter company goes bust after spending big on Facebook ads
#55They were even called Unicorn. That's just great.
Re: E-scooter company goes bust after spending big on Facebook ads
#56If you give $700 to a company that promises to deliver a scooter, and they spend that money on advertising, that’s fraud. They have no plausible argument that they didn’t know they couldn’t deliver or refund customers after they started spending pre-order funds. I hope customers get successful chargebacks and there’s a class action lawsuit. This wasn’t a crowdfunding campaign. Consumers were lied to, and the law shou…
You're not wrong, you're an idealist, which typically are very closely intertwined when it comes to reality. If you gave $700 to a company who promised to deliver you a scooter a few years down the line if all of the dominoes fell exactly as planned... I would argue that you got what you paid for even if it amounts to nothing tangible in the long run. Which is to say, you paid for a pricey digital lottery ticket with…
Yeah, I don't understand the craze with all the kickstarters.
I've backed a few here and there. Two of them I knew the principals for a while before the kickstarter began.
And I supported them at a level I considered a donation, so that if I never received anything, that's OK.
Another I backed (ReSpeaker from Seeed Studios) I did because we were interested in it for a project at work, and it was convenient for me personally to back it. And they did (eventually) deliver, which I had a reasonable assurance of because I'd bought from Seeed before.
If you want to back a game or something at a reasonable level (like $40), that's fine.
I did almost back Tilt-5, but ended up not doing so, not because of any concerns about the company, but concerns about my time that I'd have to mess around with it when I got it.
Re: E-scooter company goes bust after spending big on Facebook ads
#57If you give $700 to a company that promises to deliver a scooter, and they spend that money on advertising, that’s fraud. They have no plausible argument that they didn’t know they couldn’t deliver or refund customers after they started spending pre-order funds. I hope customers get successful chargebacks and there’s a class action lawsuit. This wasn’t a crowdfunding campaign. Consumers were lied to, and the law shou…
Not fraud just bad business. If they spent the money in good faith expecting to make a profit, it is just bad business.
Re: E-scooter company goes bust after spending big on Facebook ads
#58The title is super misleading. They have only 150k in funding. I wouldn't attribute their bankruptcy to Google or FB.
The company's founder did state this in an email however:
>The cost of "Facebook and Google ads, payments for loans, and other expenses" ate through the company's funding quicker than Mr Evans anticipated.
>"A large proportion of the revenue went toward paying for Facebook ads to bring traffic to the site," the email says.
Re: E-scooter company goes bust after spending big on Facebook ads
#59Earlier quoted context omitted.
An LLC does not protect one in cases of fraud. IANAL, but I believe the practices of Unicorn may constitute fraud under a legal definition. In such a case, Nick Evans would be personally liable for damages.
Sure, but nobody has given an example that would be considered fraud. "They spent too much on marketing and not enough fulfilling orders" isn't in itself fraud, just a badly run business that is now bankrupt as a direct result. If the bar for fraud was set that low, I bet half of failed startups would be considered "fraudulent." More than half if you look at restaurants. > Fraud is generally defined in the law as an…
On 11/13 they promised to be preparing to start deliveries on 12/15.
If at this point they had not made an effort to reach this goal (placing an order with the manufacturer for example), that is a misrepresentation of fact.
Fraud doesn’t imply malice. They could have jumped the gun on announcing they were preparing to deliver, but doing so would still constitute fraud, especially if this drove an increase in orders.
Re: E-scooter company goes bust after spending big on Facebook ads
#60The title is super misleading. They have only 150k in funding. I wouldn't attribute their bankruptcy to Google or FB.
The company's founder did state this in an email however: >The cost of "Facebook and Google ads, payments for loans, and other expenses" ate through the company's funding quicker than Mr Evans anticipated. >"A large proportion of the revenue went toward paying for Facebook ads to bring traffic to the site," the email says.
What I meant this level of funding is not adequate for the company's operation, regardless of the planned ad spending.
Yes they shouldn't spend on ads, like not at all. They should instead focus on raising more money to be serious.