Lily Drone Is Dead Despite $34 Million In Pre-Orders

Megalith

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Not that I have experience designing a drone and selling it to the masses, but is $34 million really not enough to get something like this off the ground? It sounds like they spent all the money on creating prototypes but did not set aside any budget for final production.

Lily Robotics stormed into the world with a follow-along camera drone that earned $34 million in pre-orders. But the company has now admitted that it can't deliver the product, and will wind down in the near future. In a blog post, co-founders Antoine Balaresque and Henry Bradlow explained that they've run out of money. The devices are, apparently, pretty much ready to go after lots of testing, but extensive R&D costs cleaned out Lily's bank accounts. That meant that there was no cash left over to fund the production run and outside investment was not forthcoming. Thankfully, the remaining money will be used to reimburse those people who pre-ordered the device…
 
Considering you can now get follow-me technology in half the $100+ drones coming out of China (and evolving with more features roughly every 9 months, and dropping in price every 6) it doesn't really surprise me the company couldn't seal the deal. FCC rulings and regulations likely contributed as well, if your drone is 'auto following' you, it means you are not in direct control of the craft, and I'm going to guess this drone was over the weight limit for FCC licensing which states you have to have VFR (Visual Flight Rules) on your craft at all times and be in control of it. If I was an investor, that's where my head would be at right now.
 
Somebody pissed away A LOT of money. I have built and programmed a quad from scratch, and recently added an auto-follow feature to it's autopilot. I estimate I've spent maybe 500-600 hours of personal time on the project over the past couple of years. It should NOT take $34 million to develop something like this.
 
was this from a crowdfunding campaign? i would never support that crap!
 
$34 Million is practically nothing for a hardware project. This is partly why you see more hardware projects seeking crowd funding than software projects (except games). Hardware has a much higher initial cost and much lower return on investment than software projects. Employees typically need to be at the same facility, hardware labs are expensive, prototype units are insanely expensive, a single tooling change could buy a house in some parts of the country.

In my opinion, hardware design is going to be in real trouble in the next 5-10 years as investors continue to flock to low risk, high reward, software projects.
 
You would probably need a team of 10-20 people to bring a product like this to market on engineering ALONE. Their burden rate is probably between $150-$200/hour. So in a year somewhere between $3 million and $8million goes to just staff overhead. This does not include the HW itself.

As to Ghram...hobbiest projects != production projects. Tell me when you have been involved in a project that sells 100k+ units for its initial launch and then tell me yeah, there wer e no issues..I designed the whole thing in 500 hours and it was easy.
 
More than enough. This is what you get when you have a team get a ton of funding. They scale, higher a ton of people, and get very little completed or lack ethics/knowledge to put in strict financial controls.

A garage team with a few 3D printers and a decent level of knowledge could have developed this - there's been slightly different variations that came before.

My guess? They took the Silicon Valley route and dumped a ton of money into hip offices to attract the "young talent." And probably over hired management types. The show Silicon Valley gets it's a lot of material from industry insiders.
 
As to Ghram...hobbiest projects != production projects. Tell me when you have been involved in a project that sells 100k+ units for its initial launch and then tell me yeah, there wer e no issues..I designed the whole thing in 500 hours and it was easy.

I work as an engineer for a major defense contractor, I have worked on and delivered on 'small' projects for more complex systems that cost in the roughly $50 Million range for the government with initial batches in the few thousands (our unit costs were significantly more...obviously). The most recent of such projects I've worked had R&D costs of $18 million for an $82 million rapid development and production contract. This thing should have required like 2 engineers and less than $500K...they were literally putting a camera, GPS, and tracking algorithms on a quadcopter. Hell, most of the software already existed. I really don't see how they could have run out of money here.
 
I work as an engineer for a major defense contractor, I have worked on and delivered on 'small' projects for more complex systems that cost in the roughly $50 Million range for the government with initial batches in the few thousands (our unit costs were significantly more...obviously). The most recent of such projects I've worked had R&D costs of $18 million for an $82 million rapid development and production contract. This thing should have required like 2 engineers and less than $500K...they were literally putting a camera, GPS, and tracking algorithms on a quadcopter. Hell, most of the software already existed. I really don't see how they could have run out of money here.

Yep...totally makes sense. You are starting from an established baseline of products with known constraints and processes with decades of maturation behind them and somehow comparing this to people are running a startup and probably don't have a clue because this is their first time trying to do something like this as they follow their dream. Yeah...you don't get it.
 
Yep...totally makes sense. You are starting from an established baseline of products with known constraints and processes with decades of maturation behind them and somehow comparing this to people are running a startup and probably don't have a clue because this is their first time trying to do something like this as they follow their dream. Yeah...you don't get it.
Nope, those contracts come from the SOF world and are usually asking for something totally unique. I also do work on such a program you are talking about where there is a ton of re-use, it will eventually be worth billions if we make it to production. It drives me up the wall and is boring as shit. If I ever see a USSOCOM contract come down I always jump at the opportunity as it is almost always a novel piece of equipment they want. I do have the advantage of a pre-existing manufacturing infrastructure, but those costs are factored into contract negotiations as that shit wasn't cheap either.

Also, the fact that they didn't manage to get any additional outside investment tells me I'm right. I'll bet their investors got a look at their R&D burn rate, saw that these dudes were incompetent and cut their losses.
 
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1 shop machinist + CNC (metal parts)
1 3d Printer artist (plastic parts)
1 electrical engineer
2 programmers
Use of off the shelf parts to assemble it to frame. (fans, motors, batteries, logic circuits, camera)

What am I missing?

Hell when I worked for NASA in the mid 90's we put a satellite up in space <$1,000,000 start to finish. That was ground up development.
 
Yep...totally makes sense. You are starting from an established baseline of products with known constraints and processes with decades of maturation behind them and somehow comparing this to people are running a startup and probably don't have a clue because this is their first time trying to do something like this as they follow their dream. Yeah...you don't get it.

They are not trying to be the first people on the moon, they are building a quad copter...This is a known tech, with all sorts of open source info and software for them. You are not going to hire on 2 engineers who have nothing to do with the field, you are going to hire people who have experience and tell them the goals. The tech for ALL of this to happen, exists already, and not only exists, but has gotten extremely cheap. Software already exists for it, and you have people who have written software that can do this as a hobby. They had (and burned through) $14 million in VC investment, plus having 32M in preorders, yet still failed to have enough to get it finished in R&D. If you think these things cost THAT much in R&D, you are kidding yourself. For something as basic as a follow me drone. Keep in mind others have follow me drones with controllers and video streaming etc etc who have done it with less than 5M in R&D, the Lily drone doesn't even have a remote for control no less video streaming ability etc etc. It doesn't even have a replaceable battery, it doesn't have a gimble AT ALL which is a major cost for most drones, where exactly do you see this extremely simple and basic drone costing 14M in R&D and still not being profitable enough to to put into production at almost $1,000 a pop?
 
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Okay, they pissed away THIRTY FOUR MILLION DOLLARS?

What was their R&D procedure?

Build a model, then hookers and blow for a week after?

Fuck!


I remember this one hitting the web back around 2+ years ago. So maybe they were less driven and shared the hooker and settled for weed.
 
Nope, those contracts come from the SOF world and are usually asking for something totally unique. I also do work on such a program you are talking about where there is a ton of re-use, it will eventually be worth billions if we make it to production. It drives me up the wall and is boring as shit. If I ever see a USSOCOM contract come down I always jump at the opportunity as it is almost always a novel piece of equipment they want. I do have the advantage of a pre-existing manufacturing infrastructure, but those costs are factored into contract negotiations as that shit wasn't cheap either.

Also, the fact that they didn't manage to get any additional outside investment tells me I'm right. I'll bet their investors got a look at their R&D burn rate, saw that these dudes were incompetent and cut their losses.

Agree 100% on all posts.

Do you happen to work with fiber lasers?
 
Looking on the bright side:

* Clearly lots of room for new, legitimate business ventures when the competition can't actualize a common tech toy with 34 million dollars to burn.
* Reimbursement means free personal lessons in impulsive, self-entitled behavior and irresponsible investment.
 
It's hard for me not to have a very cynical and hard assed attitude toward something like this.

I guess I just can't imagine how anyone could accept all that funding and not feel obligated to produce the product.

I do IT work and I am a contractor, my customer is the Army, and today I took the Government dude who is responsible for your server room inside and showed him a problem we have with our power distribution. It's not super critical, and we could fix it and he's never have known that we had missed this for over a year. But if it went south over the weekend I don't want him to be standing there holding his dick in his hand with nothing to say but "I don't know what happened". At least he knows it's an issue, that we are on it, and how we are going to fix it. I just feel responsible to the customer as a rep for my company.

So when I see shit like this I don't get it. It looks pretty reprehensible.
 
It's hard for me not to have a very cynical and hard assed attitude toward something like this.

I guess I just can't imagine how anyone could accept all that funding and not feel obligated to produce the product.

I do IT work and I am a contractor, my customer is the Army, and today I took the Government dude who is responsible for your server room inside and showed him a problem we have with our power distribution. It's not super critical, and we could fix it and he's never have known that we had missed this for over a year. But if it went south over the weekend I don't want him to be standing there holding his dick in his hand with nothing to say but "I don't know what happened". At least he knows it's an issue, that we are on it, and how we are going to fix it. I just feel responsible to the customer as a rep for my company.

So when I see shit like this I don't get it. It looks pretty reprehensible.
This is why we don't have $34,000,000.
 
It's hard for me not to have a very cynical and hard assed attitude toward something like this.

I guess I just can't imagine how anyone could accept all that funding and not feel obligated to produce the product.

I do IT work and I am a contractor, my customer is the Army, and today I took the Government dude who is responsible for your server room inside and showed him a problem we have with our power distribution. It's not super critical, and we could fix it and he's never have known that we had missed this for over a year. But if it went south over the weekend I don't want him to be standing there holding his dick in his hand with nothing to say but "I don't know what happened". At least he knows it's an issue, that we are on it, and how we are going to fix it. I just feel responsible to the customer as a rep for my company.

So when I see shit like this I don't get it. It looks pretty reprehensible.

Your objective and logic based way of looking at things, is why you will never be CEO of a company and have people donate millions of dollars for a promise to you.

If you could at least on some spare time on the weekends, practice the following skills; Bullshitting, forgetting important deadlines, asking engineers whatis possible and then promising more than that for less money, spend company money on personal items, and pretend you fart rainbows and were appointed by god to be where you are.

If you can nail down some of these, you might start to see 34million dollars coming into your life :p
 
Nope, they are refunding everyone it said in article
...MINUS the money they already spent. Which apparently was all of it. That's just to get people off their back. Total scam. Fancy CGI video + cool idea = instant suckers. Sorry for the people that were duped. Sue them.
 
Lawsuits for misappropriation in 3, 2, 1...

Creatives once again failing to grasp the fundamentals of running a business.
Being innovative doesn't mean you can manage resources.

Kickstarters from now on should contract banks to disperse funds only when milestones are met.
Don't award the company all of the resources at once. Kinda like building a house through a bank. They come and inspect the progress before writing a check to continue.
 
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...MINUS the money they already spent. Which apparently was all of it. That's just to get people off their back. Total scam. Fancy CGI video + cool idea = instant suckers. Sorry for the people that were duped. Sue them.

They spent 14M in VC investment at minimum. How much of the preorder money was spent we will probably never know, I do hope everyone gets their money back, but I am assuming they spent SOME of the 32M or they are lying about it being "finished", if it really was, then there would be no reason to not go into production, that, or the units cost more to make than you are charging for them, something I don't see happening with how simple these things are, and lacking most of the expensive features and parts other drones have. Which makes me think they are either not close to being finished, or they spent way to much of the preorder money already to pay for production costs, which means there are going to be a lot of pissed off people.
 
Lesson for me ....

Run Kickstarter, gain capitol, make deal with 3rd party successful manufacturing company that already makes drones to make your new drones and keep what you can from the funding, give a little back as a thank you "PR", and take the profits to pay your salary as CEO of your new company.

This is what that guy with his new water-block should do :cool:
 
Creatives once again failing to grasp the fundamentals of running a business.
Being innovative doesn't mean you can management resources.

Kickstarters from now on should contract hire banks to disperse funds only when milestones are met.
Don't award the company all of the resources at once. Kinda like building a house through a bank. They come and inspect the progress before writing a check to continue.

Part of my job is providing ROI numbers all the time. A simple project by myself can cost them a small boat. Time we add in Q&A and engineering a pet project can get expensive. If I ask them for $10,000 or $1,000,000, I have to justify it and it has to be reviewed at several levels. We produce software and hardware. Rolling the numbers isn't that hard. Although some of it is SWAG factor, it's never off that much.

No company is going to go, "Here's $34,000,000...have fun" without it being reviewed by dozens of people and voted on by the board based on other budget request.

So from personal experience I can tell you that this budget seems extreme given my manufacturing, computer, and engineering experience based on what manpower and tooling they needed.
 
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Part of my job is providing ROI numbers all the time. A simple project by myself can cost them a small boat. Time we add in Q&A and engineering a pet project can get expensive. If I ask them for $10,000 or $1,000,000, I have to justify it and it has to be reviewed at several levels. We produce software and hardware. Rolling the numbers isn't that hard. Although some of it is SWAG factor, it's never off that much.

No company is going to go, "Here's $34,000,000...have fun" without it being reviewed by dozens of people and voted on by the board based on other budget request.

So from personal experience I can tell you that this budget seems extreme given my manufacturing, computer, and engineering experience based on what manpower and tooling they needed.

Was actually 48 million when you consider the 14M in VC they also got at the start. That's a lot of money for a gimped drone.
 
Part of my job is providing ROI numbers all the time. A simple project by myself can cost them a small boat. Time we add in Q&A and engineering a pet project can get expensive. If I ask them for $10,000 or $1,000,000, I have to justify it and it has to be reviewed at several levels. We produce software and hardware. Rolling the numbers isn't that hard. Although some of it is SWAG factor, it's never off that much.

No company is going to go, "Here's $34,000,000...have fun" without it being reviewed by dozens of people and voted on by the board based on other budget request.

So from personal experience I can tell you that this budget seems extreme given my manufacturing, computer, and engineering experience based on what manpower and tooling they needed.
Which is why their VC investors told them to piss off when they came begging for money again.
 
Which is why their VC investors told them to piss off when they came begging for money again.

Which is what makes me think they really were not "ready for production", the VC firm invested 14M, when they went back to get more from them, I know they required proof and documentation of where they were, and it was bad enough for the VC firm to turn them down.
 
Which is what makes me think they really were not "ready for production", the VC firm invested 14M, when they went back to get more from them, I know they required proof and documentation of where they were, and it was bad enough for the VC firm to turn them down.

Yep. If we aren't tracking milestones to spending dollars, the plug gets pulled...
 
Which is why their VC investors told them to piss off when they came begging for money again.
Which is why VC is a far better business model than these crowd funding sources. With crowd funding, nothing more than a five min sales pitch is needed, and because so little money is invested per person, they have no control or accountability to any particular individual, and that individual is not going to do much research into the viability of the project since their investment is so small.

A VC investing a million dollars by contrast will be watching them like a hawk, and doing plenty of due diligence first before even plopping down the money.
 
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