After $34M in preorders, iOS-connected self-flying drone project Lily crashes, will issue ...

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Citing production issues, the makers of Lily -- an autonomous, iOS-connected drone that aimed to simplify aerial photography --?have announced that their project has been completely canceled, and refunds will be issued to customers over the next 60 days.




Introduced in 2015, the Lily was pitched as a self-flying drone that would make it easy to record footage of people on a range of outdoor activities, such as sports or a walk. Users simply had to throw the drone into the air, with it automatically taking flight and recording nearby activities.

A total of $34 million from approximately 60,000 pre-orders were received, but a company blog post advises this wasn't enough to start the drone's production. Founders Antoine Balaresque and Henry Bradlow jointly told supporters this week that the drone had received good feedback from the beta program, but the company had been "racing against a clock of ever-diminishing funds."

Attempts to secure financing to start manufacturing of the drone over the last couple of months failed, the founders said. They will now wind down the company and issue refunds to customers.




Preorders will be reimbursed over the next 60 days, with payments returning to credit and debit cards used for the original transaction, though there is a form available for cases where the card has expired to arrange alternate payments. Considering the financial difficulties, it is unclear if refunds will be made in full to the project's backers.

At launch, Lily showed promise as a relatively easy to use and hardy drone that simplified video capture of activities. It was also a cheap prospect for those pre-ordering it, as early orders received the introductory price of $499 plus shipping, with the final release price expected to be $999.

An accompanying wearable beacon would have told the drone what to follow and circle, complete with a waterproof case that could be worn on the wrist. The compact puck also had a microphone, intended to record sound closer to the subject for later inclusion in the final video.

The onboard drone camera was advertised take 12-megapixel still images, as well as record 1080p video at 60 frames per second, or 720p at 120 frames per second. The official iOS app would have shown a live video feed from the drone, and let users change camera settings during flights, as well as providing editing and sharing options once flights had completed.

Comments

  • Reply 1 of 16
    MacProMacPro Posts: 18,147member
    Saturated market maybe?
    smaceslin
  • Reply 2 of 16
    I had one on pre-order. What a disappointment. This is exactly the sort of drone I'm after. Just something simple that would follow a beacon in my pocket while I was kayaking (takes off from water) and snowboarding. Also the ability to fly a pre-programmed flight path. Oh well. Time to find another. I believe there's one Australian manufacturer of something similar. I think I even saw something by gopro? You can be sure it's over priced if it is. 
  • Reply 3 of 16
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
  • Reply 4 of 16
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
    It has nothing to do with the market saturation. They already sold $34 million worth of non-existing products. They just cannot manufacture them cost-effectively/underestimated the production cost.
    sandorStrangeDayspulseimages
  • Reply 5 of 16
    DroneMasterDroneMaster Posts: 1unconfirmed, member
    Just buy a DJI Mavic Pro, completely blows all of these drones out of the water (no pun intended)
    yojimbo007SpamSandwich
  • Reply 6 of 16
    vlad1k said:
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
    It has nothing to do with the market saturation. They already sold $34 million worth of non-existing products. They just cannot manufacture them cost-effectively/underestimated the production cost.
    That is 68,000 units.  This is out of 1 million drones sold just over the holiday season in the US.  Not globally.  So I appreciate your strong quick dismissal of my statement but market saturation cannot be overlooked.  Yes they could have underestimated production costs and this could have contributed to the issue but to overlook the competitive pressures is wrong.
    pulseimages
  • Reply 7 of 16
    sandorsandor Posts: 505member
    vlad1k said:
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
    It has nothing to do with the market saturation. They already sold $34 million worth of non-existing products. They just cannot manufacture them cost-effectively/underestimated the production cost.
    That is 68,000 units.  This is out of 1 million drones sold just over the holiday season in the US.  Not globally.  So I appreciate your strong quick dismissal of my statement but market saturation cannot be overlooked.  Yes they could have underestimated production costs and this could have contributed to the issue but to overlook the competitive pressures is wrong.
    where do you get your sales figures from?
  • Reply 8 of 16
    vlad1k said:
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
    It has nothing to do with the market saturation. They already sold $34 million worth of non-existing products. They just cannot manufacture them cost-effectively/underestimated the production cost.
    That is 68,000 units.  This is out of 1 million drones sold just over the holiday season in the US.  Not globally.  So I appreciate your strong quick dismissal of my statement but market saturation cannot be overlooked.  Yes they could have underestimated production costs and this could have contributed to the issue but to overlook the competitive pressures is wrong.
    I disagree with your assessment. Kickstarter style preorders are always small and do not reflect final product sales in the retail channel. They would have produced these 68,000 units if they could, but they very plainly stated it was not cost effective to do so. Production costs were too high. Not an unusual situation for a new product and company -- learning how to do what you're doing, yield, etc. Starting something new is hard, even if fully funded on backer sites. That's why they often fail. 
  • Reply 9 of 16
    vlad1k said:
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
    It has nothing to do with the market saturation. They already sold $34 million worth of non-existing products. They just cannot manufacture them cost-effectively/underestimated the production cost.
    That is 68,000 units.  This is out of 1 million drones sold just over the holiday season in the US.  Not globally.  So I appreciate your strong quick dismissal of my statement but market saturation cannot be overlooked.  Yes they could have underestimated production costs and this could have contributed to the issue but to overlook the competitive pressures is wrong.
    I disagree with your assessment. Kickstarter style preorders are always small and do not reflect final product sales in the retail channel. They would have produced these 68,000 units if they could, but they very plainly stated it was not cost effective to do so. Production costs were too high. Not an unusual situation for a new product and company -- learning how to do what you're doing, yield, etc. Starting something new is hard, even if fully funded on backer sites. That's why they often fail. 
    Fine by me I was in agreement with the production comment.  I just think there is more to it.  Had they sold double what they did they may have been able to figure out the production cost problems.
  • Reply 10 of 16

    sandor said:
    vlad1k said:
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
    It has nothing to do with the market saturation. They already sold $34 million worth of non-existing products. They just cannot manufacture them cost-effectively/underestimated the production cost.
    That is 68,000 units.  This is out of 1 million drones sold just over the holiday season in the US.  Not globally.  So I appreciate your strong quick dismissal of my statement but market saturation cannot be overlooked.  Yes they could have underestimated production costs and this could have contributed to the issue but to overlook the competitive pressures is wrong.
    where do you get your sales figures from?
    Pulled them form 2 articles online.  Coin toss if they are accurate.
  • Reply 11 of 16
    That is 68,000 units.  This is out of 1 million drones sold just over the holiday season in the US.  Not globally.  So I appreciate your strong quick dismissal of my statement but market saturation cannot be overlooked.  Yes they could have underestimated production costs and this could have contributed to the issue but to overlook the competitive pressures is wrong.
    where do you get your sales figures from?
    Pulled them form 2 articles online.  Coin toss if they are accurate.
    I can believe those sales figures - but my guess would be that they've included $10-50 'toy' drones, which is a very different market to people who are willing to pay $500+.
  • Reply 12 of 16
    maestro64maestro64 Posts: 4,481member
    vlad1k said:
    MacPro said:
    Saturated market maybe?
    I think so. Too many good companies out there to buy drones that were significantly better. Maybe a valuable lesson learned for ambitious entrepreneurs. Know your market. I thought the product was promising but understand how this happened.
    It has nothing to do with the market saturation. They already sold $34 million worth of non-existing products. They just cannot manufacture them cost-effectively/underestimated the production cost.

    At first that is what I thought, you have to read they statement, they could not get fund to start production, which leads me to my real thought on this. How do you burn through cash at a rate that does not allow you to go into production and still give back money to the consumers. Something does not sound right.

    They are not sharing the whole story with everyone. There is more to this than market issue and under estimating production costs. Something went really wrong since they could easily used the $34M to finance production ramp up and could have also borrow against these AR monies.

  • Reply 13 of 16
    Its a tough wourlc out there.. I feel bad for the founders!
  • Reply 14 of 16
    My guess is they were leveraging pre-orders to secure production financing or a buyout neither of which happened. As for the pre-orders, if they were booked on Kickstarter the chances of getting money back are slim, but they also did pre-sales on their site, and by accounting rules that money should have been booked as prepaid orders, a liability on the balance sheet, with the cash untouchable until they shipped. 
  • Reply 15 of 16
    chasmchasm Posts: 1,277member
    Pulled them form 2 articles online.  Coin toss if they are accurate.
    There's also, you know, math. For the sake of argument, let's assume that 75 percent of the backers wanted the heavily-discounted $500 drone itself, and chose that as their reward. 75 percent of $34M is $25.5M, and thus there would have been approximately 51,000 buyers. That said, a key line in the article: "racing against a clock of ever-diminishing funds." I hope I'm wrong, but that would imply that most of the $34M was spent already (probably on salaries and exploratory and prototype costs), and will not be recouped by backers.
  • Reply 16 of 16
    In my opinion, Kickstarter-style startups are far riskier than companies that have gone through the traditional startup mill. When it's hard to get funds and customers, it helps founders focus and get creative about getting things done. And even more importantly, when founders have their own skin in the game it makes their focus and drive even more important.
    edited January 2017
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