Tiko 3D announced yesterday that they’ve placed the company “on standby”, effectively ending their project.
This is very likely the most spectacular crowdfunding failure in the history of 3D printing, as the company raised almost USD$3M through pre-orders for over 16,000 units by April 2015. Now, two years later, it’s all but shut down.
There have been numerous low-cost 3D printer company failures recently, which prompted us to create a checklist for those willing to risk their cash on unproven Kickstarter and Indiegogo projects.
However, I doubt most backers ask themselves more than a couple of the 41 questions on our list when considering a project. People tend to get overly excited about technical features and ignore the practical aspects of whether the thing can actually be built at scale.
And, it seems that in most of these failures, the project management makes the same mistake: focusing on tech and misunderstanding how to actually manufacture products. Of course, it also doesn’t help that these projects take far too long and are inevitably eclipsed by proper manufacturers along the way.
But in Tiko 3D’s case, there are some profound comments from “Team Tiko”:
We had no idea how difficult it would be to go from a prototype to mass production.We learned along the way, but most mistakes were costly and irreversible. Our greatest mistake was committing to inventory too soon. We didn’t realize it at first, but by ordering components in bulk, we had backed ourselves into a corner. Design flaws appeared, and we were trapped. By the time we understood our predicament, it was already too late. We were in too deep, and there was no turning back. Our cheerful mission to empower innovators had become a struggle to survive.
This is simply poor planning by manufacturing rookies. It could have been avoided if they had proper manufacturing expertise on their team, or even advising them. (Note: this is a strong lesson for other would-be crowdfunders: your team MUST include ALL the right skill sets beyond engineering.)
I think Tiko has now realized this, as they say:
Up until now, we have been on our own. We believed investors would get in the way, but that was immature. It’s time to put that thinking behind us, and start working with people who have the resources and experience to manufacture a product at this scale, and build a sustainable business.
We are already well into discussions with a number of interested investors. They are fully aware of our situation, but see our vision for the industry, and the roadmap for our technologies. They understand the challenges, but also recognize the potential for a bright future.
And this is more than likely another problem: what investor would consider taking on the brand of the biggest 3D printer crowdfunding failure in history? If so, they would absolutely have to abandon the Tiko 3D name and essentially start over, as the design, while said to be complete, is likely less than required for optimum manufacturing. And why do this when there is so much competition from companies producing great equipment at low prices? And by the time you do that, the competition will be even greater. I don’t see much of a future for Tiko 3D.
That said, the company has not completely shut down. While they are ceasing production of new units and stopping new orders, they are committed to delivering the initial Kickstarter orders and the rest of the funds will be used for their “turnaround effort”. There will be no refunds.
This is obviously tremendously disappointing for all involved, particularly those who started Tiko 3D and who must have marveled at the astonishing fundraising they achieved. But that’s only the beginning of a very difficult process.
Is this the end for 3D printer crowdfunded launches? I really don’t think so, so long as they are executed properly. I strongly recommend you read our launch checklist to ask the right questions about a project to see if it could be viable.
There is one more important thing to get from this situation: it seems there IS a demand for low cost 3D printers.
But they have to be actually delivered.