There was a time where crowdfunding projects on Kickstarter or IndieGogo was an interesting affair. Many prominent individuals posted their unique projects, asking for fundings and then eventually making the cut. However, our team at First Option Recovery soon found out about the new types of crowdfunding scams that kept on unfolding on a daily basis on these crowdfunded platforms. As a result, our team (it boasts of over 128+ attorneys by the way), decided to investigate and found out that a lot of campaigns in these crowdfunding platforms are indeed fake.
If you don’t know what First Option Recovery is, let us assure you that your knowledge about our firm will eventually help you in the long run. As of now, we have recovered over $19 million from over 3100+ cases that we have worked on. We have been successfully dealing with endless crowdfunding scams have recovered a lot of funds from that particular scam because of an amazing team of private investigators working in over 22+ countries and our success rate of over 90% clearly proves how dedicated we are to our craft.
Earlier, we had to wait for the great innovative products to come to the market but now, if we fund them, we are supposed to get them for a bigger discount. The discount part freaked out many buyers who ended up purchasing the products and the majority of them were mostly happy with the purchases, some of the most famous crowdfunded campaigns being the Oculus Rift VR Headset, the Pebble Smartwatch and the Bragi True- Wireless Headphones.
Before calling a crowdfunded product as a scam, First Option Recovery lets you know that not all crowdfunded campaigns are fraudulent and some have done exceptionally well in the field, all thanks to the crowdfunded money. Though a lot of products end up overpromising and under-delivering, some never make it directly to the consumer market. In case of a failure, one thinks that one has become another victim of a one of the many crowdfunding scams, but that’s not true. He can directly contact us at First Option Recovery for help.
A lot of projects, despite the funding, can have unexpected manufacturing delays due to the overload of orders past its manufacturing capabilities. If a project ends up being too successful, they would find it a hard time fulfilling all the order requests. However, a few not so distinguished ones end up being one of the many crowdfunding scams which is now being discussed in the below paragraphs.
The most famous among the crowdfunding scams being the iBackPack, a company that built backpacks and shoulder bags that had built-in batteries for charging on the go. The company after raising the entire capital is required for funding the project, and claimed that they would start with the shipping very soon. Unfortunately, it was never shipped and after a thorough investigation by the FTC, it was found out that the majority of the capital investments were used by the CEO for personal use. Moreover, the company later threatened that they would leak all the personal info of all the investors which created havoc and the FTC ultimately banned the company forever.
The advisors at First Option Recovery already warned its customers about iBackPack being just another of the many crowdfunding scams. The advice came from the top-class advisors that we have hired after thorough scrutiny and many layers of the interview process. The latter also made a list of the tips and tricks as to how one should avoid such crowdfunding scams in the future, the details of which are listed below.
Tips to Avoid Crowdfunding Scams
Since Kickstarter and IndieGogo are well-known brands, many scammers have taken advantage of the situation to bring about many scam products and run away with the money once the entire funding is raised. Coming to the valid points in order to avoid crowdfunding scams, it is always advisable to look forward to the below points.
Verify the background of the creator team
We at First Option Recovery, do a thorough background check of any candidate before we hire one. The candidate needs to go through numerous rounds of interviews in order to secure his or her place in our team. The conclusion derived is that, before you invest in anything, be it a person or your money, you need to do a proper verification beforehand.
Firstly, one needs to investigate the creator team backing a project. If there is no information backing the creator team, there is a high chance of the product being another of the many crowdfunding scams found so far. Indiegogo has a wide selection of tools in its crowdfunding platform where a product funding description has a “Guaranteed Delivery Perk”. This means that the product is in the final stages of production and delivery will start soon. Also, under the Guaranteed Delivery Perk, if the product does not reach you, then you need to file a refund claim which they will process with due credit.
Find out whether the product is in the development stage or production stage
You yourself should always be careful before backing a project. In order to assure yourself that the product is not another of the many crowdfunding scams, you need to make sure whether a product is in the developmental stages or in the production stage. If the creators are still on the hunt on the prototype, there is a high chance you won’t get your product. However, if the production is complete and the creators are working on the marketing field, there is zero possibility of anything going wrong. So, ultimately, the choice lies within your hands.
Find out how complex the product is to manufacture
First Option Recovery is known to deal with the most complex crowdfunding scams with ease and finesse. Coming to the word ‘complex’ they seem to have been a misunderstanding, that if a product goes through a set of complex procedures, it ought to be good. But the process is not true for products that you find on crowdfunded platforms, because such procedures require a lot of manual labour, something which cannot be provided by these platforms.
Whenever you read about a product, do start contemplating how complex it is to manufacture, design and implement. Some products are really easy to manufacture while some require a lot of budgets which cannot be fulfilled under a Kickstarter or IndieGoGo campaign. The complex structure of the product requires one to hire a team of experienced developers, designers and product managers. So, ultimately the product will never reach you at the end of the day and you might lose your money.
What to do when you have lost your money?
Crowdfunding is a relatively new concept and with just over a decade old, many innocent buyers are still not aware of the situation that they are in right now. Crowdfunding Scams will take the world by storm very soon and if you are already a victim of one, just let us know at First Option Recovery and we will definitely help you out. Our private investigators are spread all across the globe and we, as a top-class fund recovery firm have been helping clients recovering funds since the time these online crowdfunding firms were introduced. With over a decade of experience backing us, we have worked for over 3000+ cases, recovering more than $19 million so far. Contact us directly regarding any type of crowdfunding scams where you have lost your money and we will definitely get back to you with a proper solution.