The video is out. The shipments are not sent yet. SmartMaker facebook page disappears. Harold only updates with stupid excuses… What kind of campaign is this?
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In an effort to figure out what would motivate a man who has for the past almost 9 months done nothing with the 160k he collected from 982 unsuspecting makers on Kickstarter to launch a second campaign just a few weeks ago which collected another 164k (with flexible funding) from over 7000 backers on Indiegogo... mostly nonprofits, students and teachers.
I started breaking the offer down... I could be completely mistaken and crucifying this hapless, altruistic gent and his accomplice for no reason and wanted to take a second look.
So what did the Borderless Electronics campaign promise?
15,000 Arduino Leonardo clones @ $9.00/each - Average Arduino runs around $30, so on the surface this is a great deal right? Meh, not so much.
Aliexpress has been my goto source for years when I needed large quantities of this or that from China, here is what I found:
1 or more for $9.46 (free shipping) / 10 or more $9.27 (free shipping)
317 feedback ratings / 98.8 satisfaction - Nice
Outdated link http://www.aliexpress.com/item/Freeshipping-Leonardo-R3-development-board-Board-USB-Cable-compatible-arduino/1140267592.html
1 or more for $9.35 (free drop shipping) / 15 or more $8.88 (free drop shipping)
Outdated link http://www.aliexpress.com/item/Leonardo-R3-Development-Board-for-Arduino-Compatiblae-USB-Cable-Wire-FZ0437-Free-Shipping-Dropshipping/918008140.html
Current link: http://bit.ly/AliexpressLeonardo
In the Great Yellow Kickstarter Caper, we covered Dimitri Albino's eBay sellers guide: Drop Shipping, namely how to sell goods without having anything in the warehouse or investing money!
If we apply what we learned from this how to guide and apply Indiegogo's flexible funding rules, here is how I posit this contemptible sham is running:
Flexible funding Paypal payments hit the Smartmaker Inc. account almost immediately - Cash in hand now floats
From the example above, we see the price point drop significantly - from $9.35 to $8.88 @ 15 items... Imagine for a second how much further the price point drops at 15,000 items.
Dimitri contracts with a drop shipper to produce the Arduino clones with the new color silk screen to give the pretense of custom production (Standard ship times from China drop shippers is 30 - 60 days, on target for Borderless Electronics timetable)
Dimitri can float the $164k collected for at least a few more months before he is ever invoiced by drop shipper (if he actually intends to deliver)
Still making a decent profit due to the volume price drop - Think WalMart buying power (altruistic facade exposed)
Most importantly, skirting Paypal's 60 day refund policy (and leaving another 7000 backers potentially in the cold if this plays out like the Kickstarter campaign)
With a price point available to everyone direct from a credible manufacturer with scads of great feedback...
Why would anyone trust the guy who has had $160k for 9 months and never delivered... much less done anything verifiable at all?
Just a theory, I could be wrong. All I did was apply the lesson Dimitri taught me in his drop shipping guide... What do you think?
