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E-scooter company goes bust after spending big on Facebook ads

bbc.com

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Re: E-scooter company goes bust after spending big on Facebook ads

#71

Post by braindeath »

johnfactorial wrote: post #42
flyGuyOnTheSly wrote: post #28

Earlier 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…

> 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. Is that what happened with this company? That's the model of kickstarters and the like, but this story sounds like it was a real company offering a product for sale. If a co…

> real company

This is a bit nebulous. Every consumer, especially where the expense is a lot of money for them would do well to give this idea more thought.

A pretty website, a few employees and some prototypes doesn’t hit a meaningful bar, let alone millions of dollars in capital (which this joint didn’t even have), TBH. Too bad fuckedcompany is no longer around, it did a great service.

Re: E-scooter company goes bust after spending big on Facebook ads

#73

Post by kelnos »

ansible wrote: post #56
flyGuyOnTheSly wrote: post #28

Earlier 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…

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 per…

ReSpeaker was a shame, though. The v1 hardware was horrifically unstable (and then they quickly moved on to v2 and swept v1 under the rug). But, I went into it with the expectation that things might work out, so, while I was disappointed, I knew that was a possibility from the start.

Re: E-scooter company goes bust after spending big on Facebook ads

#74

Post by SamBam »

paulpauper wrote: post #46

Facebook ads are way too expensive and tend to not convert that well. There are stories of fake likes and fake clicks. If your growth strategy involves buying click ads, find another strategy or business idea. Groupon is another company that overpaid on Facebook ads to build its email list. Disney and other multinationals are the only companies that should buying such ad.

Who is generating the fake likes and fake clicks (even if anecdotally)? Facebook itself?

Re: E-scooter company goes bust after spending big on Facebook ads

#75

Post by filmgirlcw »

bransonf wrote: post #59
Someone1234 wrote: post #36

Earlier quoted context omitted.

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.

If they were still accepting new orders on 11/13 under those promises, that might be fraud. But any of the older backers wouldn't fall under that.

You would have to prove that when the statements to prepare delivery for 12/15 were made, the company had absolute knowledge that no future funding was going to come and that it was guaranteed that they were lying.

If the company was in talks with other investors and thought it might be able to raise in order to ship what was necessary, that's not fraud. That's bad business and everyone should be weary/stay the hell away from any future venture from this place, but that isn't fraud.

Re: E-scooter company goes bust after spending big on Facebook ads

#76

Post by mehhh »

sieabahlpark wrote: post #63
jberm123 wrote: post #47

Earlier quoted context omitted.

>what's to stop the same employees and founders from following that method ad infinitum? Informed consumers

I didn't realize scamming was a legal business venture.

Plenty of companies never deliver a product, hence chargebacks being built into our credit & debit systems (and being available for checks in a restricted form)

Re: E-scooter company goes bust after spending big on Facebook ads

#77

Post by rco8786 »

The fact that the company's name is "Unicorn" makes this seem like a much bigger deal than it is. The company raised just $150k. And it sucks that they screwed over their customers who paid, someone should be accountable here. But it's not like someone went and blew millions on ads only to realize it wasn't sustainable.

Re: E-scooter company goes bust after spending big on Facebook ads

#78

Post by filmgirlcw »

toomuchtodo wrote: post #52
Someone1234 wrote: post #49

Earlier quoted context omitted.

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.

But the broader point about lawsuits not being free is valid. Because in addition to filing fees, you need to pay lawyers to do this. And I am not a lawyer, but I don't know many good lawyers would would take on a case to go after a bankrupt company that has no assets. And even then, those good lawyers are going to want a retainer and multi-hundred dollar an hour fees to do the work, so sure. File a lawsuit. Spend tens of thousands of dollars to get a judgment that the defendant can't pay. What good does that do?

Like, to be clear, if you have more money than God and want to spend time making a point, I'm all for it. You do you. But most people don't have that much money or time to piss away when there is nothing to be gained from the exercise.

Re: E-scooter company goes bust after spending big on Facebook ads

#79

Post by xamuel »

1290cc wrote: post #32

Chamath Palihapitiya talked about this problem in an interview from 2018. Many tech startups spend 0.40c of every VC dollar with FB/Google/Amazon. Here is the original interview: https://www.youtube.com/watch?v=RwRZtZQoLtQ

Ironic considering most tech startups' exit plan is essentially to be acquired by FB/Google/Amazon. They are de facto R&D branches for FB/Google/Amazon with all the attendant risk and none of the benefits.

Re: E-scooter company goes bust after spending big on Facebook ads

#80

Post by foolfoolz »

shaneprrlt wrote: post #66

I feel horrible for the people who had to scrape together the $700 for a Christmas present for their kids, who won't be getting their scooter (like the person in the article). For most middle class people, that's a lot of money. I second the comments about successful chargebacks, because this will probably be ruining some kids Christmases out there otherwise. :(

this is a fabricated scenario.

you could have bought a xiaomi scooter on amazon for $300 - $400 anytime this year. who would ever buy into some maybe-scooter kickstarter if they were low on cash? and who low on cash is buying $700 christmas presents?

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