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Daily news and analysis about the food tech revolution

iGulu

Beer Brewing Startup iGulu is Back from the Dead, Plans to Split Brewing Machine Into Two

Like something out of a horror movie, beer brewing automation startup iGulu has come back from the dead, reanimating into something resembling a startup trying to bring a product to market.

The company, whose demise was well-documented here on The Spoon, apparently never gave up on its dream of delivering a beer-brewing appliance. Over the last year, the company’s CEO,  Shu Zhang, has been posting updates on both Kickstarter and Indiegogo (they raised funds on both platforms) about the company’s progress in paying down its debt and cobbling a new team together.

In an April update, Zhang said the company had paid down its debt and was hunting for new financing. Zhang also said the company had hired new product designers.

At present, our team of Home-machine Project includes professional, experienced and top-notch specialists in software, hardware, beer technology, structure, etc., constituting the strong R&D lineup of related products.

In a July update, Zhang said the team numbered ten and that they had decided to change the machine’s design from its original all-in-one brewing concept into two pieces of hardware.

There will be two products. One is the mashing machine for enthusiasts and deep players, from whole malt to wort; Another one is the beer capsule appliance, from wort to beer; The design capacity of the machine is about 1 gallon.

In an October update, Zhang gives a volume production date (end of 2023) and more details on the two-machine concept:

…the new machine will be implemented in two products. The first product will Mash making wort from grain. This product is designed for traditional home brewing enthusiasts. It supports high efficiency and high quality wort generation with your own recipes. The other machine is a fermentor and dispensing machine, this will support fermentation of both wort, and malt extract. The dispensing tap will be a disposable pipe design. It will also be capable of holding some existing commercial beer capsules (like 5L Heineken Beer Keg) for instant drinking. We are currently mid way through the design process for the new product. 

Zhang’s explanation of the transition from one brewing appliance to two is a little confusing since he never clarifies if iGulu intends to send both machines to original backers. The original machine takes care of the entire brew process from grains to glass, but one needs both of iGulu’s new product family to create a drinkable glass of beer from scratch. It appears most backers are assuming they will get both, but strangely Zhang talks about the two machines as if they are targeting different audiences when he explains the wort-making appliance as being designed “for enthusiasts.”

With all the confusion, product pauses, restarts, and time passed (nearly seven years at this point), I expected most backers to dismiss Zhang’s reboot on the iGulu. Instead, while a good chunk is predictably skeptical, some encourage Zhang to keep plugging.

For my part, I’m doubtful iGulu ever makes it to market and would advise against any new or existing backer giving the company any money. With the likelihood of little to no new crowdfund money coming in, the company has a tough road ahead in raising additional capital to help get it over the finish line. The success rate of home brewing appliances has not been encouraging, and investors are taking an ever-more-skeptical eye toward every investment nowadays.

All that said, the company has survived longer than anyone could have predicted and still has a pulse, so we’ll be keeping an eye on how things shake out next year.

Crowdfunded Home Beer Maker iGulu Appears to Be a Goner

If you love beer and are contemplating backing a crowdfunded home brew machine — don’t. This free advice is brought to you by more than a year of covering Kickstarted beer campaigns, most of which have taken the public’s money, only to shut down before shipping any product.

Following in the steps of Brewbot and HOPii, it now looks like iGulu is the latest automated home brewing appliance to fold. The following update was posted to Indiegogo and Kickstarter on April 4:

Dear Backers,

We regret to announce that we have to put our project in ‘hibernation’ and pause our regular update. For the past few weeks we have experienced some of the hardest challenges for our company and the project. Our funds were exhausted and we experienced a significant team downsizing due to the financial constraints.

While I still maintain great working relationships with all of our key team members, I couldn’t keep them as employees before I secure new funds from the investor. We have been talking with several prospects since last year, but the financial markets are unfavorable to start-ups like ours recently so I haven’t had any luck yet.

I’m still trying but I cannot at present give any specific timeline for recovery of this project. I will share any further updates whenever we have tangible progress that we are able to report. I deeply apologize again. We have shipped the first machine to one Australian backer. We will continue to fix existing bugs, optimize our product, ship 2nd, 3rd and more machines. Please believe us. We won’t give up.

Regards,

iGulu Team

This development isn’t actually that surprising for anyone who backed or followed the project. iGulu met its funding goal in May of 2016, and after a litany of production and manufacturing delays, the CEO publicly apologized to backers in December of 2017 and said the company had secured an undisclosed amount of funding from three Chinese VC firms to supplement the $1.1 million it had raised via crowdfunding. At that time, the company was expecting to ship its product in July 2018.

This projected ship date obviously came and went with no (well, one?) iGulus brewing up frosty mugs of beer for the backers who ponied up at least $489 a pop to get one. And though the latest update seems to offer those who funded the project a ray of hope, history shows its unlikely that all of the 1,000+ backers will ever get their iGulus.

We’ve reached out to iGulu for comment and will update if we hear back.

At this point, we sound like a broken record, but there’s a HUGE caveat emptor when backing hardware projects from untested companies on crowdfunding platforms. Designing a one-off prototype is relatively easy. Manufacturing that same device at scale in China brings up a host of unforeseen and expensive issues (see: Rite Press, Cinder).

Some home beer brewers have come out of crowdfunding unscathed — Picobrew and BrewArt, for example. I am also optimistic about BEERMKR because that was built by an existing company that had previous experience with beer-related hardware.

It doesn’t look, however, like iGulu has got what it takes to succeed. Appliance giant LG is getting into the home brew appliance business; maybe it can do what Desora did with Cinder and buy up iGulu’s assets for cheap.

Oh, and if that lone Australian who received their device is reading, please drop us a line to let us know how it works.

Crowdfunding Fiascos: Smart Plate, iGulu, and the Curious Case of HOPii Shutting Down

Crowdfunding your hardware product ain’t easy. Well, getting a crowd to fund your hardware product at least seems easier than actually getting that product to market. Crowdfunding cases in point: The oft-delayed Smart Plate and iGulu are oft-delayed once more, and in mysterious turn of events, crowdfunding darling HOPii has shut down entirely.

First up is Smart Plate, which bills itself as “The world’s first Intelligent Nutrition Platform that instantly analyzes everything you eat.” It’s been a long (now longer), strange trip for the combination plate + scale + mobile app that recognizes your food, weighs it and gives you its nutritional information. From the original pitch on Shark Tank that aired in early 2016 to a crowdfunding campaign that raised more than $150,000 to the promise of a ship date last summer, the Smart Plate has gone through a few iterations over its many months in developments. And based on an Indiegogo update earlier this month, backers are going to have to wait a few months more. From that update:


“…unfortunately, we have a new shipping date due to some manufacturing issues that developed during the latest quality testing.

…The new shipping date is this Holidays (November/December 2018).

We fully understand that the product delays have been causing a lot of frustration, but as they say ‘A delayed product is eventually good, but a rushed product is forever bad.’ We sincerely ask for your understanding and support.”

Backers who have been waiting are understandably upset and are venting on the Smart Plate campaign page. However, it won’t do them much good. As the refund policy points out:

“From now through shipping, we will not be able to provide any refunds. This is because all funds have been used for the production and materials of SmartPlate. We’ve already placed the order for 10,000 SmartPlates to be manufactured, and the production process is on-going and cannot be reversed at this point. We’d like to ask for your patience and support one last time. Give us until shipping, and if you are not satisfied with what you get, we will give you a full refund.”

Elsewhere, when we last checked in with the home beer brewing machine iGulu in December, that company had bumped its promised delivery date from Q3 of 2016 to July of this year. At that time, the company had even raised funding from three different Chinese venture firms. The amount raised was undisclosed, but iGulu’s CEO told us via email that it was enough to “…cover the full mass production and delivery for our first-generation machine. Then it also can support us to jumpstart development of our second-generation machine.”

Looks like the company should have raised more, as an Indigogo update from iGulu on August 5 said:

“Finally, we’d like to address all questions regarding the shipping date again. We have heard your voices, and we don’t mean to ignore them. We were overly optimistic about the shipping date when we launched the crowdfunding campaign. We certainly won’t make that mistake again. Instead, we chose to be transparent about development, testing, and production. Of course, there has been a fair share of bumps in the road. Due to our small company’s production numbers, we are not in a strong negotiating position with any of the suppliers. This position is because they can dictate the timing of the production. At this point, we feel it’s more productive to be prudent and provide honest updates on each stage of development rather than taking a guess and then having to correct it. Thank you for your understanding.”

Can’t miss a new ship date if you don’t make one, I guess.

Finally, we were taken aback to hear that HOPii, another crowdfunded home beer brewing system that had raised more than $380,000, has shut down completely.

HOPii’s sudden demise was surprising to us in particular because their countertop beer machine was a big hit as part of our Startup Showcase at last year’s Smart Kitchen Summit, and was Innovation Award Honoree at this year’s CES.

In an update on Indiegogo on May 24, 2018, HOPii CEO, Jong Shin wrote:

“This is going to be an update that no founder of a company would ever want to write. There is never a good way to deliver a bad news, but I am going to be as transparent as possible. We recently ran into an unexpected tragedy and unfortunately will have to close down the project. We will be sending you the details shortly in a separate email.”

It’s when you hop (pardon the pun) over to the Kickstarter comments page that things get intense. There’s a thicket of comments and angry backers and updates from HOPii, but it appears that there is some legal battle (possibly with LG, if one commenter in the thread is accurate) going on in Korea. Shin won’t provide details as the litigation is ongoing, but an update from three months ago says he was in Korea for the “start of the battle,” and that “justice will win and we will fight to stand for what we believe in.”

Additionally, there are walls of text outlining in detail a litany of production and money issues. There’s so much that we are actually putting together a follow-up story and have reached out to Shin for more details. We’ll provide a link to that story when it goes live.

Unfulfilled promises in crowdfunding projects help illustrate why Kickstarter launched its Hardware Studio to help make sure hardware projects don’t crash and burn through so much of other people’s money.

CEO of Crowdfunded iGulu Apologizes to Backers, Raises VC Funds

Creating a self-contained home brewing system is evidently harder than it looks. iGulu, the crowdfunded, countertop beer making machine had initially promised delivery to backers in Q3 of 2016. But an update posted by the company on its Indiegogo page indicates that mass production to fulfill all backers won’t happen until July 2018.

Just a few days ago, on November 27, the company provided a lengthy breakdown of reasons for the latest delays, and included the following bit:

Based on the recent exchange rate (CNY: USD = 6.6:1), we have spent $1.45M on this project. We have raised about $1.1M from two platforms and received a net fund of $910,000 after all agent fee, and the platform fee, have been deducted. We are operating on our new investor’s money now and are very confident to carry on the project since we just made solid progress in the past six months.

To its credit, iGulu has posted 34 updates, and has seemingly been transparent about the troubles it encountered. But some backers are understandably upset, having shelled out at least $489 dollars to back the project. But a refund doesn’t seem like it will happen anytime soon, as the company posted on Indiegogo yesterday:

For those of you who asked for a refund, we deeply apologize again that your investment didn’t work out. We just don’t have the negotiating power with our venture capital investors to be able to use their funds for refunding rather than investing in working capital which is critical to generating future cash flow. As our CEO stated, we have recorded all of your requests and will refund you when we have the cash-flow.

We reached out to iGulu via email with questions, and CEO Shu Zhang replied saying iGulu has received funding from three venture capital firms in China, but the names of the firms and the amount raised was not disclosed. He also provided with the following statement:

This fund can cover the full mass production and delivery for our first-generation machine. Then it also can support us to jumpstart development of our second-generation machine.

The causes of our numerous delays were several design and supplier issues. We encountered all kinds of difficulties that startups frequently face, but we have improved our processes and are steadfast in our commitment to release a safe and reliable unit.

Regardless, I am deeply sorry for the delays to all of our backers, but we are on the right track now. It is evident at this point that we were overly optimistic. Building a workable prototype in a living room is one thing, but mass production of a commercially ready product is entirely different.

Finally, I’d like to apologize again to all of our backers for missing our original date by so wide a margin. I’d like to have all of our backers know that we are hanging there and that all of your voices have been heard.

iGulu isn’t the only crowdfunded homebrew system to hit hard times. Last month, Brewbot narrowly avoided being shut down completely after only delivering a few of its promised units.

It’s not all bad news for for budding home beermakers though. The grandaddy of crowdfunded homebrew, Picobrew, continues to deliver its products. And Hopii, which crowdfunded $386,401 was a hit at our recent Smart Kitchen Summit.