It has been quite some time since we last spoke, and it’s time to bring you up to speed. As you may recall, in February we announced that Tiko had run into financial difficulties. We had frozen all operations, but we were not yet ready to quit. We have since spent over half a year quietly exploring ways to get back on track. We pursued many avenues, but in the end, came up short. As such, it is time for us to share the strategies we explored, the efforts we made, and to finally make a necessary –albeit heartbreaking– announcement. But first, let’s start from the beginning.
The Turnaround Effort
After February’s announcement, we maintained some R&D momentum, this time in China. We knew that we would have to demonstrate technical improvements in order to raise capital. Given our financial predicament, our options were limited. But still we pressed onward.
Through a combination of experimental firmware developments, slicer fine-tuning, minor hardware adjustments, and QC process improvements, we were able to realize measurable improvements in print quality, success rates, and overall reliability.
Unfortunately, improving print quality was not enough to secure a deal. While investors were impressed by the printer and complimented us on our work, they ultimately turned us down. Tiko was not a good fit. We kept seeking new investors, but a pattern soon emerged. Our capital requirements were too large for Angels, but our operation was too risky for Venture Capital. We had scaled up too soon, and sought capital too late.
Over and over again, we were turned down. By late May we had gotten the message – Tiko would not be funded. Still, we were not ready to give up, and so we explored other ideas.
First, we reached out to the dozens of distributors who had contacted us over the past year. It seemed there were countless opportunities here, but it turned out there weren’t. Some were small-scale re-sellers seeking order sizes too small to overcome our manufacturing overheads. Others were large and established distributors that required us to manufacture inventory first – using capital we did not have and could not raise. We were stuck, and one by one, the opportunities fizzled out.
Throughout the campaign, we had concentrated on fulfilling rewards first, so we largely left commercial (B2B) sales/distribution on the back-burner. While this felt morally right, it also meant that we had missed our opportunity to create strong partnerships and sales channels (which take months or years to build) that could potentially have saved us.
We tried taking a more active approach by attending some local B2B tradeshows to meet other distributors. While we received a great deal of interest, nothing significant ever materialized. We had already missed the boat.
Through June and beyond, we attempted to bootstrap our way to some profitability, enough to prove traction/stability with those risk-averse investors. We therefore put the remaining few Tiko’s into local retail stores, and worked with their staff to optimize sales.
While Tiko received great interest, the sales were modest at best. Tiko was cool, but it was neither a necessity nor an impulse buy. The investors were not impressed – and we needed them. Local sales alone would not save us.
Even if we had sold all of the remaining (assembled) inventory, the resulting revenue would not have covered the overhead of manufacturing additional units. All we had left were boxes and boxes of parts – but not of the whole BOM. A few components were only manufactured JIT (Just in Time) due to their size (ie chassis) leaving us with very little finished stock. By now, other components were also being held as collateral.
We simply could not manufacture additional units from sales revenue alone. Tiko was designed for mass manufacture – small batches were prohibitively expensive to produce. We continued to explore a combination of investment/distribution/retail, trying to use each to bolster the others, but it was slowly becoming clear that the company would not make a comeback. Tiko was buckling under its own weight, and there was nothing we could do about it.
By August and we were beaten and bruised, but not broken. We knew the company could not recover, but we hoped to at least salvage the situation for our backers – even if that meant walking away with nothing.
There are some rather powerful technologies within Tiko’s hardware and software – technologies we believed could be of value to established manufacturers. Even if a company didn’t wish to manufacture the Tiko printer, the technologies inside could be of interest to them. As such, we pursued a number of leads to sell the company/IP in exchange for the minimum funds required to ship Tiko (or a substitute printer) to backers, or otherwise offer a full. We received some interest, but nothing that would completely satisfy Tiko’s obligations. We were running out of options.
The Final Stretch
By September, we had only one lead left. It had already been several months in the making, and looked promising. It was a hybrid investment-acquisition deal that would have resulted in the shipment of all remaining printers to backers. We were thrilled. It seemed like a solution was finally around the corner.
We had worked quietly and diligently for so long to get to this stage, and we didn’t want to screw it up by prematurely announcing good news. It felt so damn close, like we were on the cusp of closing the deal and getting back to work. At the same time, it had been an eternity since we posted any updates. Weeks had become months, and months had become seasons. This whole situation had gotten way out of hand.
We didn’t know what to do. We focused on closing the deal, and decided not to rock the boat. We had come this far, why not stall just a bit longer. It was Tiko’s last chance at a great future after all. We weren’t going to let it slip. It was so damn close, so we kept pushing forward.
However, by late-September, something was wrong. This was taking too long. The other party showed signs of cold feet. New excuses kept popping up. Always a new delay. It took until mid-October for them to finally come out and say it - they weren’t interested anymore, and the deal was dead. It was game over.
A Painful Decision
It has been a rough and painful journey, and we have exhausted every option available to us. We did our best to bring Tiko to life and to your door, but in the end, it wasn’t enough. We are now making the only decision left to make. With deep sadness in our hearts, and much to our disappointment, we are officially closing the company. It’s over. The project has failed.
What Happens Next?
Today’s update marks the official end of Tiko project to the world at large. There will be another (more backer-oriented) update posted this week, in which we will provide additional backer-specific information (ie how the funds were used, how the windup will proceed, etc) and generally fulfill the remainder of these contractual obligations.
During this time we encourage you to ask any questions you may have, as this post will include an FAQ.
Let’s face it. There is no good way to end this. Tiko was our baby – meaning yours and ours. We built all of this together. You believed in us, you supported us, and still we let you down. We’re sorry. Deeply, truly, sorry.
Despite all of the pain, grief, and frustration this campaign has caused, we still genuinely wish to thank you. It didn’t end the way we wanted, but we still shared an incredible journey together. You gave Tiko a chance at life. You saw our vision, and you dared to dream with us.
So many amazing people took part in the Tiko story, both in and outside of the Kickstarter community. We thank each and every one of you for the support you showed us during these turbulent years. Even when we stumbled, you showed us compassion. You gave us strength. You challenged us. You inspired us.
We hope that every one of you comes out of this stronger. Our backers. Our employees. Our suppliers. Our advisers. Our partners. Everyone. This wasn’t all for nothing. Together we have learned so much. We have grown wiser, more resilient, and more grateful for what we have.
With that, we wish every one of you the best moving forward. We have learned the hard way that chasing your dreams can be risky, but trust us, letting them go is worse. Whatever you do in your life, wherever you may go, we hope that you will still dare to dream. To dream big. To take your chance and to pursue it. Whether you succeed, or not, you’ll never know unless you try.
So try, try, and try again. You only have one life. Give it everything you’ve got.