Helmet Maker Blows Through Millions, Closes Doors

The self-proclaimed world’s smartest motorcycle helmet offers GPS navigation, a rear view camera, Bluetooth and internet connectivity to your smart phone and vision enhancement features. Heads up displays show critical information for the wearer, all in their line of sight, so they can focus on the road ahead. This sounded so great that, when the designers of the Skully helmet put their idea on crowdfunding website IndieGoGo, they absolutely pulverized their goal of $250,000, by raising nearly 2.5 million from close to 2,000 backers who ponied up cash to pre-order gear and helmets.

Too bad they’re never going to see the products – or likely their money – ever again.

You see, Skully’s founders – brothers Marcus and Mitchell Weller – have just announced that the company is, sadly, closing its doors and pursuing Chapter 7 Bankruptcy. In a note posted on their IndieGoGo campaign page, the brothers cite “unforeseen challenges and circumstances” that were beyond their control and say they are “devastated.”

But the story doesn’t end here. Anyone with a nose can smell a rat when you consider that Skully outfunded its goal by nearly 1,000 percent. Oh, and PS: according to CNN Money, Skully went on to raise an additional $11 million in venture capital funding after the crowdfund. So what the heck happened?

Well, here’s on option. A former Skully bookkeeper has filed a lawsuit alleging that the Weller brothers mis-managed company funds in a big way. Like, Lamborghinis and strip clubs big. The woman’s lawsuit calls the company so fraudulent in its financial activities as to render it a total scam.

Speaking of scams – this is a good reminder that crowdfunding sites like IndieGoGo, for all their good, don’t actually guarantee you will receive the product, as advertised. While a case like this is rare, a quick review of the Indiegogo terms of use reinforces that the site does not represent that Campaign Owners will deliver their goods or that contributions will be used as described in the Campaign.

Meanwhile, Skully says all of its assets are now subject to liens held by a secured creditor. My heart especially goes out to the three backers who spent $25K apiece on the 20 helmet distributor pack. If only the company, like the helmet, had vision enhancement features, they wouldn’t be in this mess.

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