UPDATE 3/28 10:17 AM: Equiso has issued the following statement in response to this story.
In July 2012, Equiso was living the Kickstarter dream. Now it's in a Kickstarter nightmare.
It has legions of unhappy customers, alleged threats from hacking group Anonymous, and a forgotten co-founder who claims to have been unfairly ousted.
It's also being accused of selling a product that is just a rebranded version of something available from a Chinese company.
Kickstarter is a crowdfunding platform that lets people raise money over the internet to pursue creative projects. Equiso leveraged the service last year to raise $241,557 from 2,703 people to bring its product to market. The company was pitching an Android-powered HDMI "dongle" called the Smart TV, which promised to turn every television into a smart, web-connected device. Users would simply plug the dongle into their TV, enabling them to run apps like Netflix and Angry Birds on their television screens. The attachment essentially turned a TV into a giant Android tablet.
The device shipped late and didn't perform especially well. When we reviewed it in October, we discouraged people from buying it. Apps lagged beyond the point of usability.
We weren't the only ones disappointed by Equiso's Smart TV.
People who got their Smart TV complained of " a product that barely functions, completely fails to meet the promises of its creators, and in all likelihood, never will. " They also weren't happy that Equiso wasn't responding to complaints: " Emails are ignored, Facebook posts and tweets are deleted. If you happen to live in Boston and visited the Equiso office, I suspect you might see a tumbleweed. "
To this day there are users complaining of never having received their product. Lots of Kickstarter backers are upset.
All this complaining appears to have gotten the attention of the infamous hacking group Anonymous .
On the site where it posts its releases, AnonNews, Anonymous is demanding that Equiso CEO Adam McBride publicly apologize and refund "$241,000 to Kickstarter backers and $2,000,000+ to investors" within one week or it will begin leaking his personal details, such as "bank accounts, credit information, passwords, emails, and social media."
After that, Anonymous says it will do the same for other Equiso employees and will even attack its partners.
It's important to note that Anonymous is an amorphous group without any known structure or organization. These threats could be coming from any number of people who may or may not have the means to follow through with them. The group has previously hacked high-profile targets like the Westboro Baptist Church, Sarah Palin, and Citi. While it seems odd that it would turn its attention to a small company, it's not impossible.
McBride, however, believes the threats do not come from Anonymous at all.
Strained relations between co-founders
McBride believes that a former employee posted all the threats to AnonNews. He says she is "a crazy employee who had gone rogue" after McBride fired her upon finding out that she had lied about previous work experience.
We reached out to this employee who requested to not be identified. She told us she wasn't just a former employee, but a co-founder, and that McBride recruited her via email through a mutual acquaintance. She says no resumes were ever involved and she never misrepresented any past professional experiences.
She says the trouble began when she started working from home due to disagreements with McBride, and soon found herself locked out of the company's email and computer systems.
She claims no connections to Anonymous and still maintains a 30 percent equity stake in Equiso, emphasizing that it would be against her interest to hurt the company while owning so much of it.
We returned to McBride with this information, who maintained that the co-founder didn't leave voluntarily and was, in fact, fired. It wasn't for lying about any specific job experience, but instead for misrepresenting connections to media partners like Hulu and for lying about having access to money to invest in the company.
Is Equiso just a rebranded gadget from China?
Another one of the accusations from hacking group Anonymous is that Equiso's Smart TV is little more than a rebranded product from UPTEK, a Shenzhen, China company that makes its own "smart TV" dongle . Tech-savvy users in the Equiso forum have confirmed the devices are one and the same.
We asked McBride about his company's relationship with UPTEK and he told us that it was a partnership. But there's no mention of this in his Kickstarter video and no acknowledgment that he was getting the dongle from China and tweaking it.
His estranged co-founder/employee tells us that instead of working on improving the product, McBride would "spend hours looking at packaging design."
Is Walmart a partner or not?
There's another weird wrinkle in this story. Equiso partner Jeffry Waye told us via email that "the Equiso will be in Walmart stores nationwide starting April 10."
Another Equiso partner, Ralph Teed, claims "over ten years experience with Wal-Mart Inc." on his LinkedIn page, so the retail giant seems an obvious route for selling more devices. When we spoke to Teed on the phone, he told us that Equiso distribution partner DPG had already received a purchase order from Walmart and had sent a purchase order of its own to Equiso.
We emailed Kevin O'Connor, vice president and general merchandise manager for consumer electronics at Walmart, to ask about the company's relationship with Equiso and DPG (which has an Equiso logo on its homepage). O'Connor told us, "We have not heard of Equiso and they are not a supplier to us. If this is the brand or manufacturer, then we do not know them and would not be selling their product. Maybe on walmart.com. I don’t know DPG either."
We also reached out to Walmart's PR in case O'Connor was mistaken. We spoke over the phone yesterday morning to a Walmart spokesperson named Debbie who said she'd look into it and get back to us. We made several attempts to get back in touch throughout the day and this morning, but still haven't heard from her.
McBride tells us via email that the Walmart deal is "not official yet."
UPDATE 3/27 11:14 AM: A Walmart spokesperson confirmed for us that the Equiso Smart TV will be in stores "this spring." No specific date was given.
What went wrong?
Equiso's problems seem to stem from its upset customers. The overwhelming complaint is that Equiso has not been communicative enough with its Kickstarter backers. At the time of this writing, its last customer communication went out on January 17.
We asked McBride about this lack of communication and he explained that he and his team are busy improving the product. He added that the company did most of its customer communication one-on-one via the comments section of Kickstarter, leaving 571 comments to date.
Consider the Pebble smartwatch, by contrast. It was a similarly hyped and over-funded Kickstarter project that met similar difficulties in delivering on time. Instead of maintaining radio silence in order to ship at maximum efficiency, the Pebble team nearly over-communicated. Backers received more regular notifications, each one offering substantial updates on the company's progress. The Pebble team even created a dedicated website to give anyone an update at a glance – IsPebbleShipping.com.
The lesson in this for Kickstarter backers is to be patient and understanding. This seems especially true with gadget-based projects. Manufacturers often run into delays and other unforeseen problems. When you "vote" in favor of a creator's idea on Kickstarter, you are not actually buying a product like you would from an ecommerce site. You're funding a project and, for better or worse, you're along for the ride.
And for a Kickstarter project leader, the takeaway seems to be to make sure your backers know what's going on. This is especially true for high-profile projects. Pebble handled its difficulties well. It's a model that Equiso would do well to follow.
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