Yeah certainly – and thanks for commenting so I remember to give updates every now and then. For anyone else that reads this, I tend to get distracted easily so if it’s been a minute since you’ve heard status updates, feel free to tag me and I’ll respond!
Here’s where we’re at on this (and I’m going to give an overall company update as well in a separate thread):
- New COO has been hired
- He has been negotiating with the 5-Button Manufacturer and they have basically told him, “we don’t care what you say nor what we did, you will pay us in full” – which seems really short sighted bc we’re about to bring them (or at this point, whomever) between $3M-$7M worth of B2B sales. So, we’re trying one last attempt with them this week and if it doesn’t pan out, then we will move to our Zigbee manufacturer
- I’ve been working on a separate deal for close to a year now and they are finally in the process of committing officially, hopefully by next week. Part of this deal includes the 5-Button (however theirs is in WiFi/BT) – the profits from this deal will go to fund the Z-Wave/Zigbee variant which is this project
- This company wants this project done by CES 2023, which means we need to start now
So, what does this mean for this specific project?
If we are able to work things out with our original manufacturer, the process will be much quicker as we’ve already completed and paid for tooling, it’s just a matter of them dusting it off and putting firmware on it. My best guess would be a Q4 delivery. If we have to go to a new manufacturer, it will take a couple months to get tooling down, but these guys have also surprised me, so possibly sooner. My best guess for this would be some time in Q1 2023 (we have to have working samples ready by CES 2023, which is in January).
If this PO falls through, then I’m afraid we’ll have to throw in the towel for now or move it to a Kickstarter to get it back up and running. My vote would be to refund everyone and then start from scratch when more funding arrives.
Here are the receipts as well to back up the above in the name of transparency:
Email from manufacturer (NOTE: I’ve redacted the names)
Context: We approached them with an aggressive ask, in hopes they’d at least work with us. What has been happening is that we had an original debt of around $1M, which back in 2019 we agreed that it was both our faults (theirs bc they caused us heavy cash burn bc they said they’d have the products and guaranteed it by April 2019, but nothing came until November – ours bc we honestly should’ve managed our overhead better) and we agreed to pay 10% of our monthly sales, which we’ve been doing. In addition, we’d pay all new bills either up front or before it was shipped.
What was strange was that they claim that we owe $1.2M, which is literally impossible bc we started with a debt of $1M, have been paying our 10% (so this number should be going down) and also paying any new bills up front (so no new debt should be added). I uncovered a scheme where they’d give us an order to sign, I’d sign it, and then months later, they’d bill us for 1.5x what was on the original invoice (however, these invoices were never signed). Hence the, “we believe our debt is x, we’re going to pay you x” – or in this case, we just said, “we see some shenanigans happening, we have a $3-7M PO coming, let’s agree to erase the debt of $500k in exchange for us not going to our other manufacturer.”
EDIT: Messed up the redaction – good thing I don’t work for the gov’t!
Comments: Please understand too that a lot of what they are saying is posturing and as noted, we have our own opinion on what is owed and the signed PO’s to back it up. There hasn’t been anything free given to us, I can assure everyone of that lol. Either way, this reads, “we can’t really erase your debt, but we do have some white-label products you could buy that are Zigbee to circumvent the 10% increase of Z-Wave or we could give you 10% off of a totally inflated debt that we can’t back up”
Large Deal
Context: I’ve been working on this for quite some time and there’s been ups/downs – I love these guys and would love to work with them as they’re kind of underdogs too, but the process has taken so long bc they’re a huge company with lots of red tape.
Finally, a new person came on the team (in both companies) and has really pushed things forward with the goal of getting these to them by CES 2023.
Comments: Here’s where the $3-7M deal comes from. They are a very large player with Home Depot and there are two forecasts and it really depends on how their pitch goes in September (we plan to help as much as we can to help them nail it).
They have made it very clear the 5-Button is mandatory for launch, so this is why I say I’m confident this will get off the ground again and sooner rather than later. We just need to close the dang deal.
