Kickstarter and other crowdfunding sites have seen everything, from great successes to resounding failures, but what has most affected the reputation of this marketing model has been scams. Here we have seen “3D headphones” that raise more than three million and disappear, and many more examples, but perhaps one of the best known is the case of the Coolest Cooler, the multifunctional refrigerator that raised more than 13 million dollars to become, at that time, Kickstarter’s most successful project.
Simply put, the Coolest Cooler has been a disaster. Since its launch in 2014, more than 60,000 people have trusted the product and paid for something with a promise to receive it later. Today, its managers are confirming the closure of the company and informing that they will not be able to deliver the remaining refrigerators to those who bought them five years ago. Instead of their refrigerator, they will receive $20 in compensation. Yes, twenty dollars, out of 185 they originally paid.
Ryan Grepper, CEO of Coolest, the company behind the manufacture of the refrigerator, confirmed that they are terminating their operations because of the tariffs that the United States has set on Chinese imports. According to Grepper, this 25% is affecting its product line. A strange decision, more when it comes to a company that raised $13,285,226 five years ago, and that in 2015 decided to sell its refrigerator in Amazon for $499 dollars, even before having delivered them to all those who supported the campaign in 2014. The reason: to get additional funding to be able to manufacture the coolers for Kickstarter backers.
According to Grepper, by March 2018 they had only managed to deliver two-thirds of the more than 62,000 coolers owed to Kickstarter backers, which meant that a third still did not receive their Coolest Cooler.
Here we must remember that in 2015, the company “had to spend” 12 million dollars because, among other factors, the manufacturer of the engine of the blender that would use the refrigerator went on strike and, they say, it was impossible to get a replacement. In addition to this, in April 2016, the company asked for an additional 97 dollars to the backers of its campaign, so that they could receive the refrigerator in their homes. If they did not contribute this amount, they would have to wait longer to get it.
In 2017, some campaign supporters took legal action against the company, which led to Coolest reaching an agreement with the Oregon Department of Justice. The agreement was to provide compensation to those who did not receive their refrigerator, a compensation of just $20, as the company would have proven to be close to bankruptcy.
A few days ago, just over 20,000 people received an email confirming that they would no longer receive their Coolest Cooler after the company ceased operations. So far the delivery of the $20 compensation is in the air, but Coolest has until 2020 to deliver them according to the agreement it reached with the Oregon Department of Justice.