Coolest Cooler, known to be one of the biggest failures of crowdfunding Kickstarter, has announced it will abandon business. The main excuse given by the company is the high 25% tax rates charged on products imported from China to the US. They also say that this charge has affected Coolest's entire product line.
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The company had the second largest KickStarter funding in history, reaching over $ 13 million in 2014. But the company began shipping products to department stores before it even delivered the products to project supporters. This generated much controversy at the time and now, five years after the event, the company declares that it will close down.
Even though product taxation is real and in fact alters many business operations, Coolest Cooler already had problems before that. Even after leaving many customers without the product, the company blames the project's end on taxes. "It was devastating to our business, and I know many of you have felt, one way or another, as consumers and thousands of small businesses everywhere," Ryan Grepper CEO of Coolest Cooler.
The cooler had the big differential of a built-in blender and was equipped with high technology. Kickstarter said there was always a risk that some project might not get out of paper and also mentioned the lack of compensation from investors at Coolest Cooler.
“In this case, unfortunately, 1/3 of the supporters will not receive the reward that was promised. We have worked hard to make it clear that Kickstarter is not a store. And in the five years since this project was funded, we have taken steps to help creators be more transparent with the sponsors and better understand what it will take to bring the project to life. ”- Kickstarter Announcement
The Oregon Department of Justice ruled in 2017 that Coolest should pay a total of $ 20 per product that had not yet been delivered. Apparently the company will not comply with the court order as it has declared that it is without sufficient money. Nevertheless, the Justice Department says the company has until 2020 to return the money to its clients.
Via: The verge