Funding Complex R&D Without an Existing Product Line

Recently a rumor that Aaton has (at least temporarily) closed its doors while looking for more funding has spread around the internet. This is a personal story for me, both because I have loved using Aaton cameras in my past, and because of my current venture with Digital Bolex.

This is Jean-Pierre Beauviala and his camera…

The following is an email that was sent to the CML (Cinematography Mailing List) by Martin Euredjian, founder of eCinema Systems, discussing the situation with Aaton and the plight of small imaging companies. I asked permission before I published it here. It’s long, but very important for everyone in our industry, or learning about our industry, to read.

Funding complex R&D without an existing product line 

Well, I haven’t posted anything on CML for probably three years, if not longer.  This is going to be long.  Sorry.

I want to give the CML audience one point of view on what it takes to be a self-funded innovator in our industry and how you can help (or hurt) those who venture into entrepreneurship to, yes, serve you.

The last few years have certainly seen massive changes to our industry.  The economic downturn caused untold damage across all industries and took down a myriad of players and, yes, innovators.

Our industry is small. Very small.  Painfully small.  And fickle.  Very fickle.  Innovators walking into this with the benefit of ignorance of the business realities involved learn –the hard way– very quickly.  One of my all-time favorite quotes is by Mark Twain: “A man holding a cat by the tail learns something he can learn in no other way”.

Complex R&D in the context of a small industry with high cost of sales is a bad combination for a self-funded or underfunded entrepreneur.  Well funded companies can afford to quite literally burn cash, make mistake after mistake, sell mediocre product below cost to kill competition and grab market share.  And still survive.  When you’ve put all of your savings into your business, mortgaged your home and topped off all of your credit cards and still don’t even have enough money to match the marketing budget of larger corporations, you ought to take pause.  The problem is that an entrepreneur does not see this until having a firm grasp of the cat’s tail.  At that point it’s too late. You are all in and have no choice but to grab on and hope to survive the ride.  And, of course, sometimes we do what we do because we are passionate rather than rational.

There are so many factors conspiring against small companies in small high-tech markets.  And example of this are large suppliers who can cause a lot of damage through their decisions.  I don’t know if the alleged Dalsa sensor defect was the straw that broke the camel’s back (does anyone have verifiable data on this or is it just conjecture?) . I can tell you from first hand experience that these kinds of events can be severely crippling if you don’t have the deep pockets to absorb them.  I had one memorable experience when buying high-grade LCD panels from Samsung.  The LCD industry is known for the callousness of the OEM suppliers and the almost surreal difficulty in dealing with them.  The kind of thing you just can’t believe (or know about) until you are knee-deep in the mud.

We were getting ready to do a major product-line expansion.  eCinema was going to go from a one product company to a line of sixteen products spanning a range of applications and affordability levels.  Having had really bad experiences with LG Philips I sought to switch to a different OEM supplier and initiated negotiations with Samsung.  Does anyone remember Apple LCD monitors that went pink or magenta?  Yup, LG defects.  If they do that to Apple and get away with it, imagine what they are willing to do to small guys.  Now multiply what you imagined by ten and you might have an idea of how these OEMs can treat small manufacturers.

The Samsung negotiations happened during NAB with no less than the top three VPs of Samsung LCD Americas.  In other words, to get any higher you had to go to Korea. We agreed upon terms and they guaranteed availability of the OEM LCD modules that they helped us select.  A huge problem in the LCD business is the constant threat of premature EOL (end of life).  I had fallen pray to that one as well with LG.  This time I brought it up with Samsung multiple times.  They guaranteed seven years availability of the panels they helped us select.  Now armed with this we could embark in this major new step for eCinema.  I hired another engineer and we got to work.  Eight months and well over a million dollars later we had in our hands the first eight of the sixteen planned designs.

Then it happened.  We went to place orders with Samsung and got a chilling two line email from the distributor:  “These panels have been discontinued.  You have to redesign your product.”.

In the single-source OEM LCD business this is equivalent to having your entire product line evaporate –literally go “poof”– overnight.  This is not unlike what can happen if you single-source a custom sensor for a camera from an OEM.  Anything can take you down and you have absolutely no control.  Sue Samsung?  Right.  Good luck.  This event cost us well over a million dollars.  That is “you are now dead” money for a small business.  A lot of it is a blur now as the whole thing turned into a horrible nightmare that put me in the hospital no less than twice.  Data was hard to come by, but conjecture at the time was that the main buyer for these panels had pulled the plug on the contract and Samsung pulled the plug on the entire line, affecting all small manufacturers.  Through a distributor I learned of a manufacturer making monitors for government applications who was sued by the government to the tunes of tens of millions of dollars because
they could not deliver the product as specified.  Carnage.

In the context of all of the above we also had to deal with mind blowing market realities.  Competition can be ruthless when very well funded companies are threatened by what you are doing.  And example of this is learning that a competitor actually bribed and paid-off some our dealers to keep our product from being shown at important events such as NAB as well as off their websites.  Then there are other cases where product is almost literally given away in order to cause you damage by denying your company much-needed sales.  Stuff from movies right?  Well, no, that’s real life.  And you don’t learn about some of these things until well after the damage is done.

And then there’s you, the user, the buyer, the one who talks about what these small companies work so hard to bring to market.  You can help, a lot.  You can also hurt, a lot.

The first issue is the constant chase of the new shinny thing on the shelf.  I get it.  I understand where this comes from and the need for it.  The problem is that this is very damaging for small companies to deal with.  It causes real economic damage and, in reality, slows down innovation.  Forgive me if I can’t offer examples from other companies.  One doesn’t often learn about these incidents because they are kept very private.  So I can only talk about what I have experienced at eCinema.  Please don’t think this is about me.  It’s just that I don’t really have other examples I can share with you.

And so, we were about to close a very nice sale of potentially fifty to one hundred of our high-end monitors.  I should say that this was a much-needed sale.  As a small company you are almost always underfunded.  It can be a painful existence.  There are periods of time when you go from sale to sale walking the edge of a financial precipice.  Large purchases inject oxygen into the business, let you breathe and actually execute on your plans rather than focusing on survival.  This sale was massive for us.  The bad news was that this was taking place about a month from NAB.

I’ve always dreaded trade shows.  They are great opportunities to connect with your customers, share and learn.  And, for some, tradeshows are great opportunities to cause damage to the competition.  When a competitor learned of our large sale they moved quickly to make promises and representations about a product they were about to introduce at NAB.  The sale was stopped cold on it’s tracks, pending NAB.  In practical terms this means that, if you are lucky, you are looking at a three month delay before you resume the conversation.  A typical tradeshow cost us between $100K and $200K to put on  –not to mention opportunity costs.  This is nothing for a larger business, but for a smaller company it’s a ton of money.  I would venture to guess that if you asked most exhibitors at NAB they’d tell you that these shows are seldom worth the investment…but you have to do them because people think you are dead if you don’t show-up.  And you always have to have something new for nearly the same reasons.  Thankfully the internet has changed a lot of this.  Just know that exhibitors are spending a lot of money to have a chance to talk to you face to face and almost always this is at a non-trivial financial loss for small companies.

The loss of this sale caused us to have to retreat and exhibit at the MGM instead –for about $10K– and make the best of it.  As it turns out the product that was introduced –the one that stopped our sale– was shit.  It didn’t matter.  The shit product actually stopped a huge percentage of our sales for months and months.  I don’t have precise data, but I would guess the effect of the shit product lasted at least a year.  It took a while for people to realize that it was no good and then come back to us.  Again, it takes a few cuts to damage a small entity beyond repair, whereas an elephant won’t even feel it.

Constantly chasing the new shinny thing on the shelf can really hurt both you and the small entities serving the industry.  It hurts manufacturers because they are denied the much-needed steady revenue stream that supports R&D.  It hurts you because you will ultimately not benefit from the results of such innovation.  I think it is fair to say that certain kinds of innovation does not usually come from large players.  Innovators are usually small “cowboys” who risk it all to bring ideas they are passionate about to market.  They are driven by different metrics than those of the larger players and can execute difficult technology at a different pace.  Still, it often is an “all in” business with huge personal risk.

Then there’s the matter of price “warfare”.  Well, consumers at all levels tend to want to buy the lowest cost product that will meet their needs.  And that’s OK.  Greed?  Nah, just reality.  And, while I don’t have a problem with this concept or this reality in the context of a fair and even playing field it is quite a different matter when the playing field is tilted.  We have now pretty much killed manufacturing in the US and Europe.  Making nearly anything is significantly cheaper in China.  Anything.  And so, trying to compete by manufacturing in your backyard is almost delusional.

The problem is that small market (low volume) high-tech products can’t reasonably well be manufactured in China.  For example, I am working on a small project right now with plans to manufacture in China.  The minimum order quantity for one part alone is 5,000 pieces.  You can make the same part in the US at minimum order quantities of a few hundred pieces at five to ten times the cost and twice the tooling costs.  That’s just reality.

The other reason is that you really need detailed hands-on engagement with the manufacturing process in order to ensure quality (not to mention IP theft, etc.).  When competitors come into the market who opt for overseas manufacturing they usually come in with a price advantage.  The usual scenario is that of a lower quality and lesser specification product with less support, features, reliability, etc. offered at a deeply discounted price when compared to locally manufactured goods.  The other scenario is that of well-funded companies explicitly coming into the market with below or near cost pricing in order to damage the competition and take the market.  A large company can afford to lose money for a year or two in exchange for owning the market for ten.

Yes, in consumer-land there are great examples of very high quality products manufacture in China, the iPhone being on easy to site example.  The reality here is that these are huge high volume products where a massive infrastructure is put into place in order to ensure quality and delivery value.  If you are only making a few hundred of something a year you are SOL.

What does this look like from the vantage point of a small company?  Your sales half –or worst– nearly overnight with the introduction of low price products.  Your R&D efforts are stymied.  You have to retreat into survival mode and engage in the impossible task of selling the same product for less –or go overseas and play the same game. You get to compete with a product that might be 70% of yours at half the money or less.  Every sale you loose is another cut out of the one thousand that will kill you.

I can’t say much more about the chase for the lowest cost solution other than to suggest that, with every dollar you spend, you are supporting the present and future direction of a product category.  If, in a small market, buyers flock to low cost solutions the net effect will be that all mid-range innovators will be damaged and possibly taken out.  What will remain will be the uber-high-end and the low end, with few offerings in between.  You are voting with your dollars for the future of what it is you are buying. Rather than look at it as scoring a great deal for a given widget you might want to consider every single one of your purchases as a vote towards the future direction of the industry or a category in the industry.  I know, without a doubt, we had customers who bought our more expensive product instead of cheaper overseas alternatives because of precisely the idea of supporting the vision we were trying to execute and the idea of supporting your own backyard.  I remain humbled and grateful for such support and loyalty.

Advanced R&D is expensive.  As we navigated the years we continued working on what became our DPX technology for monitors.   High-end R&D is incredibly expensive, be it cameras or anything else.  We had things like custom thermal management heat sinks which cost $27,000 to prototype each and every design iteration.  And, while we ultimately installed our own CNC machining equipment in getting ready to bring DPX to market, the costs were still staggering.  I forget how many prototype iterations we went through.  Each one cost us hundreds of thousands of dollars.  When you are engaged in something like that and have to, at the same time, deal with some of the realities I discussed above, R&D happens at less-than-ideal pace.  And, frankly, it is far too easy to give up.  Without passion most do.

Finally there’s the economic downturn of 2008/2009.  How can we not talk about that.  This affected everyone.  People lost jobs by the millions.  Companies went out of business at industrial rates.  Horrible.  And, of course, our industry was in no way immune to this.  If you survived the initial blast, the radiation –in the form or much reduced or non-existing sales– eventually got you.  Unless you had the finances to survive.  In our own case it was a combination of the two.  A lot of our gear was purchased through leasing rather than outright cash transactions.  When banks stopped lending, orders stopped virtually overnight.  An unimaginable black swan event.  Still, we navigated through the initial blast and emerged damaged but stubbornly clinging to life.  Existence at that stage is very delicate.  Then we had a major deal (millions) unravel, again, because of banks setting the breaks on lending.  And that was that.  No more.

Again, my apologies for what can seem like self-serving stories.  As I said before, these are all the stories I have.  I can’t rightfully talk about what other entrepreneurs experience or have experienced in our industry.  And even where I do have some inside information from others I do not have the right to publicly discuss their internal stories and struggles.

I don’t know what the Aaton story might be.  I have to say that in all these years I have not had the pleasure of personally meeting JP.  I think we may have swapped emails a couple of times over the years, but never met in person –something I regret.  Still, I have always felt a connection to any “go it alone despite the odds” entrepreneurs as I have been that guy more than once.  It can be a hard and lonely ride that few are equipped to appreciate.  I sincerely hope JP figures out a way to come out of the ashes to grace us with great innovative thinking.

JP, if you are reading this, count me in to help in any way I can, even if all you need is to simply talk to someone who has survived something that might resemble what you might be experiencing right now.  I know that without my family, children and friends things would have been far different.

 

Be well,

-Martin Euredjian

We here at Digital Bolex have gone through some of the hardship that Martin talks about. We have had parts we were planning on using discontinued, we have had issues because of products viewed as competitors, and of course many added R&D costs because of delays and changes. This email really touched home for me and I needed to share it.

In my monologues I often talk about how small business will one day replace large companies in many ways, and while this is true, it is not without great struggle. The truth is if we want smaller more personable, more responsive companies to be able to survive in this world we have to fight for that, and as Martin so elegantly said, we have to vote for it with our dollar.

Thank you for reading this, and thank you all for your support,

Joe Rubinstein, and the entire Digital Bolex team.

This entry was posted in News by joerubinstein. Bookmark the permalink.
joerubinstein

About joerubinstein

Joe Rubinstein is one of the founders and CEO of Digital Bolex. At Polite in Public, a photo marketing company he also co-founded, Joe was the Chief Technology Officer who worked with electronics developers and software developers to create the Polite in Public Photobooth which helped define modern photo marketing services.

56 thoughts on “Funding Complex R&D Without an Existing Product Line

  1. Pingback: µTelegrams (05/13) | CineM43

    • Yes! I would love to see a D-minima come out! the A-minima was my favorite camera in college! I have heard that the D-minima is still at the concept stage and even reached out to Aaton to see if there is anyway we could help them make that happen. Good choices in the S16 space I think enhance what we are doing not take away from it, so we love Aaton and hope they make a great camera. We also love Ikonoskop and what they are doing.

  2. The only thing I’d say to Martin is “Business is tough, get over it”. I’m a self made small manufacturer and because of my “hobby” I’ve not only lost money, business partners, friends, health, a house but pretty much 30 years of my whole life. But I prevailed – I found ways to create much better products for way lover cost than the “big guys” who on monthly basis spend much more on marketing, than I ever spent on R&D or the whole business. Yes people this is our time, the time of small companies. The market is full of interesting and quite cheap machines (even from china – but have to be rebuilt and brought to our standards) and our schools and the internet is full of very interesting knowledge that can be used to your advantage. Don’t forget the kick-starters too! So go for it!

    PS: Don’t think you can pull it off just by becomming a good designer. You have to become a manufacturer. Get into metal-working, buy used CNC machines from companies that went under, learn something about plastic-injection-moulding and heck – learn everything you need to make the product from A to Z.

    PS2: I’m glad i’m not in an industry, where I have to put LCD’s/OLED’s or CMOS/CCD chips into my products. Those things are freaking expensive to R&D and manufacture! But I hope to see more smaller companies pop creating chips and displays – they should be easier to deal with.

    Good luck Digital Bolex 😉 Keeping my fingers crossed you can create something to compliment as a B-cam to my recently bought Sony F35 (CCD!) I can’t believe my eyes everytime I start editing my new footage from this CAM.. the colors (the most important factor – screw the dynamic range) comming from this cam are everything what I ever wanted.

    • Hi Piotr,
      What business are you / were you in? (just out of curiosity)
      I think Martin’s point is not how tough business can be, I think we all know it can be tough, but to bring to attention the idea that consumers have a responsibility for the world they create by spending their dollars. If you go to McDonalds every day for lunch but complain cause there are no farmer’s markets in your immediate vicinity, maybe you have some responsibility there.

      IDK, that’s what I got out of it anyway.

      And yes I would love to one day see D16 and F35 married in a film 🙂

      • Hi Joe,

        actually this is what I meant under the “business is tough” as I feel that the customers are also a part of the whole game. We as producers simply can’t put the blame on the customers – they have always wanted and will always want cheap stuff – i’m the same! I Only bought the F35 just because I’ve got it pretty cheap (15k) – I had an offer some time ago for 30k but I refused (I could have payed but I decided to wait for another price drop). And btw Mc Donalds tastes fine and it gives people what they want. I personally stoped with the synthetic fast food thing a long time ago just because a new burger joint (not a fast-food joint) opened up and they deliver awesome organic-level burgers for very competitive price (they opened my eyes) – now you can’t get a damn table at that restaurant without a reservation during any time of the day.

        People simply want the best function (not quality really) for the best price.There are always ways how to triumph over the other hyper-greedy players in the market. You just have to find those ways.

        So really – It’s the battle that we wage against each other that decides what the consumer will buy.

        PS : If you marry F35 or any non-vintage analog material with Digital Bolex, then that’s something Joe. Ikonoskop with the simmilar chip (or the same one?) has failed to acheive this for me… the BMCC sadly didn’t even get close.

        • Absolutely true, it is up to us as innovators to come up with products that fill un-met demands and are unique in a market place, and it’s also up to consumers to support choice over mono-culture.

          We are using a chip that is in the same line as the Ikonoskop, but is slightly bigger, which is why we can offer S16mm and 2K. We are definitely working hard to make the D16 fit into the existing “film look” paradigm 🙂

          • I’m keeping my fingers crossed that you achieve your vision Joe. Shooting stuff with a camera that does its job as it should is a real treat – the colors no matter what the situation is always look just “right” so grading is so much easier.

  3. The debate, if it stays with the principle of the main idea here, is not about pitting workers, or people in one country against those in another country, sphere, or politicsl realm. One issue that is deeply troubling to me is that large, globally oriented corporations are feeding off of and exploiting extremely poorly paid people in rock bottom substandard working environments, in countries whose governing bodies, (I’m being polite here), are lacking any political accountability to their citizens. Meanwhile, these same opportunisitic players are selling into markets in which they long ago abandoned production, due to costs of labour that actually meant a dignified living wage. It is the classical “race to the bottom”. Not only are people abysmally paid, but there are terrible environmental consequences from the lack of any proper regulatory oversight, standard, or enforcement. So, if people in B.C., for example, won’t allow a polluting mine here, no problem, go and poison the environment in Guatemala, or Peru!

  4. Joe, I’m not sure if I’ll buy your camera, but I keep coming back over and over to follow your story. The way you’re reaching out to your customers and the community is so unique and wonderful to see in the age of the faceless corporation. It’s refreshing to see someone present their struggles and triumphs so openly. It’s exciting to watch.

    • Thanks Elvis! We are doing our best to work with our potential customers to build the things they want and need. I hope to see more companies take this approach in the future 🙂

  5. Well folks, there are different aspects to this. One is bad products, but the other is whether or not we want to support our local economy, or at least the economy of the social system we are living in. If the latter is also important (and I agree it is) that would unfortunately mean the end of international trade. I live in Europe, and hence should wait until Arri builds a 3000 Euro S16 camera. Which problably is three days before doosday. If not, is a US worker closer to my heart than a Chinese worker? Aren’t people people all around the world?

    • Totally true. My “argument” isn’t for or against any countries or people in any countries, it’s really for smaller more niche companies that are more responsive and responsible to their customers than the giant mega-corps. To me your vote with your dollar should be about sustaining small companies that will listen to you about what you want from products and supporting many different market segments instead of just 2. We want choices, especially as creatives.

      • Agreed.

        It is also more of a one-to-one relation. I am a small entity, so I prefer dealing with other small entities. Some things will not work this way, unnfortunately. Computers (including smartphones) are too complex for a small company to develop, and slide films, as it seems (still nobody picked up Kodachrome. I would have some ideas).

        • TPersonalized production / small batch production gets better everyday 🙂
          5 years ago printing plastic objects at home was not even something I was thinking about.
          5 years from now printing a phone might be possible.

  6. I like when restaurants show whom they buy their raw products from. In the same fashion, as a little practical step, why not make it clearer that a certain product (or part of it) is supporting the local community economy?
    The D16 making is providing jobs for Americans and Canadians, that is a plus that could be pushed forward.

  7. The Wal-Mart, Price Club, and other discount stores only succeed because most people don’t think of anything but “the lowest price is the law” as one of our local discounters used to say. They don’t think of how buying that cheap stuff is killing their city and country, putting their kids into no-name jobs at minimum wage. Nope, just get me that 42-inch tv for 500 bucks. Same with cameras: sure you can get 2K or 4K res for under six grand, not including all the necessary accessories so you can actually USE the thing, but are you getting a camera built to last, to be adaptable, built by American and Canadian engineers and designers who have incorporated hundreds of technical suggestions from a community of filmmakers?

  8. Aahh, Walmart, and the whole mentality that goes with it. Don’t shop there… ever.

    My wife and I do put our money where our mouth is, that is why we carefully examine any funds that we invest in. Ethics matter. The environment matters. Social responsibility and justice issues matter. Where you put your thoughts, your energy, and your money, matters.

    One thing that I find exceedingly strange is how many people whine about the role of big government. What about the destructive role of some large corporations or conglomerates, and the monopolies, the waste, the corruption, and the extravagance, and unethical, and even criminal practices that occur in this realm? This whole field must come under closer scrutiny and criticism.

    The role of intellectual property theft is a huge issue, and it is killing many potential brilliant advances, in my opinion. How many ideas don’t see the light of day because innovators realize that when the idea, research, planning, and R&D is brought forth, it will be immediately stolen, and magically start being manufactured in, ahem, “you know where”?

    The letter brings up an absolutely critical issue, namely, the role and responsibility of the end user. Our collective choices define the world we will live in, as Joe says in the quote from his father. This power can swing either way, to destroy our world, or make it a better place.

    For positive change to happen, this requires a further awakening of consciousness and that is what we are really talking about here.

    I am saddened by the Aaton story. I am inspired by the Bolex D16 story, because I think I understand the thinking and passion that is backing it up, and that is why I wish the Bolex D16 team every success.

    • Thank you. I think you hit the nail on the head. We need home grown businesses that are accessible by their supporters and interested in what they have to say. We need consumers who care as much about the world they are shaping with their buying habits as they do the stuff in their hobbit hole. We need more people to stand up and say “We don’t need the big corporations or governments to do this for us, we can do it ourselves”.

      • No, what you need is lawyers to bring these buggers to book who claim supply, then intentionally break contract. Legally, the contract is ” offer ” and ” acceptance ”

        Fight and survive

    • Oceanus, this is such a great way to state things. We can all make a difference. Because in the end creativity doesn’t cost anything. Joe and Elle know I’m sold on their camera and lenses. Though if I’m being honest it was actually Mike who fully won me over 🙂

      I’m hoping the release of the camera will jumpstart a whole community of D16 filmmakers who share knowledge and experiences. So that making films (at least one small part of the spectrum) becomes about what you do and how rather than which camera you used or how much it costs.

  9. Great post! And it made me think of something.

    The forum here has been a great place to exchange and share our view of things but sometimes I can’t help but think we’re forgetting that you’re a very small company and perhaps we’re asking too much. I being the first with the sharing of my point of view and ideas.

    I just want to let you know that this project and what you’re doing with your company is very close to my heart and hope your great work will pay off. I can’t help but think it will with the amount of people interested in the camera.

    We are with you.

    • Thank you, that really means a lot to us. I sometimes feel like I am asking too much of the guys too, but “If you set your goals ridiculously high and it’s a failure, you will fail above everyone else’s success.” —James Cameron

      I think this is not only something we can do, it’s something we need to do.

  10. Wow your team is amazing and if its any camera company that has what it takes to survive its Digi B. I am so pumped for your system and your company. I have lost all respect for big wig companies that feed you little bits of technology in order to cash in on it. Your company is one I would feel completely confident investing in. Thank you all for your hard work!

    • Yeah, right, little bits of technology. The funny thing is that these companies mostly weren’t like this a couple of years ago. Have a look at Nikon. They have written history with their well designed products that last forever and remained usefull. There are still a huge number of F2s out there in use. Or Sony. They actually held on to their great Trinitron tubes for too long. Or Kodak. When I compare the inherent quality of Kodachrome with their rubish inkjet printers, boy, what a decline.

      I really wonder if they all transformed only because they could produce stuff cheaper in China. Weird.

      • It’s our Walmart loving bad habits that teach companies that they shouldn’t try to build products that will last longer and be more reliable. We live more and more in a disposable world, but we know it’s unhealthy, for us, for the companies, and for the planet, but it’s very hard to step away from.

        • It must be a bit more complex than that. I always try to buy the best product I can possibly afford. But lately, I run into trouble. It seems that there are only junk products or extremely expensive stuff. It’s either Hermes or Ghana, but nothing in between.

          • This is exactly the problem that is created when we buy based primarily on price. We remove all the room for the middle options, you end up with who ever the low price leader is that week, and what the rich people / pros are willing to pay for and that’s it. If you want middle range options, which in my opinion are the BEST options for most people we need to understand and support that. Let me say that again. I think that for most people (in this case independent filmmakers) the best possible option for them is not the cheapest camera possible, and it’s also not the giant pro camera that requires a huge crew, it’s one of the options made by a camera company that is aiming squarely for the middle. I think possibly the best camera out there right now is an Alexa, but I don’t want one. It doesn’t fit the way I want to shoot, the accessories don’t fit my budget range, and I won’t get shots in focus as often as I’d like to.

          • Somehow, there must be a way to make it more interesting for both the buyer and the seller to produce long-lasting products instead of break-the-day-after-the-warranty-expires ones…

  11. During the development delays that plagued Red Epic, Jim Jannard joked:
    ” How do you become a millionaire? Be a billionaire and start a camera company.”
    The rules of the business game are stacked against the little guys more than they have been at any time since the era of the robber barons in the late 19th century.
    Great blog post Joe.

    • Thanks Razz, that means a lot coming form you. I agree with you in some ways, today there is a crazy specs / price race that seems to ignore everything else like usability 😉 but in other ways I disagree. With tools like kickstarter, facebook, twitter, ustream, and most people’s general web presence, small companies do have opportunities that didn’t exist 10 or even 5 years ago. Also the environment for engineers is very competitive, but some people that work for us are happier to be working for a small company where they are an important player instead of at a giant company where they would be one of thousands of engineers that get no real recognition. Anyway, like in all things, it is both harder and easier for small companies in different ways.

      To me the most important thing is that we as consumers become more aware of these things, demand more information about the companies we support, and make decisions that are looking as far into the future as we can 🙂

  12. Joe, this article really made me think about our responsibility as buyers. Even within the constraints of a tiny budget like I have, there is a choice. Now, with the intro of the BM pocket cine camera, another competitor–I don’t need to go into the details of whether yours is a better camera or not because the point I’m making here is that I, for one, have decided that I want the Bolex D16 for many reasons, not all of them rational, even if it costs a bit more; I want it because it looks well designed and is the right size and because its funny looking and has that crank and because, in the end, I’ve followed your story, followed the development of this, and even though I wasn’t one of those who got in on the ground floor with the Kickstarter campaign I do feel a small part of your story, and want very much to continue the relationship: I want to buy that camera, when I can, and will hold off buying a decent cine camera until I can. In the meantime I have my “Mein Kat” documentary to make so I need to get something to fill that gap, and I’ll find something, and then either keep it or sell it when I can get your camera.

    This race to the bottom that we’re all in, where we all want the cheapest price, is insanity because we end up screwing ourselves, our neighbours and our countries, by outsourcing everything to China and Korea and so on. It has to stop, we have to support home-grown industries and home-grown designers and their products.

    Now, if you needed more money, more investment, you’d let us know, right?

    Michael
    Vancouver BC

    • Michael,

      Thanks for your support! And you’ve got it exactly. We all have the power to promote the products and companies we want with our all powerful dollar. My dad used to say “More than your vote for president, more than your vote for legislation, the vote you make everyday with every dollar you spend molds the world into what you want it to be.” Or something like that 🙂

      • This is a human-race level topic, actually !

        As a lot of people are just struggling to survive, the focus narrows down to the present/short-term needs. This usually means going for the cheapest solution. And the cheapest usually comes from China etc. and is of a poor quality.
        So this cheapest is not feeding anyone from the local community and it creates near-future rubbish which amplifies the eco problems.
        I like the fact that the D16 is designed to be usable in the mid- to long-term.

        As a family, we have decided to buy our food from local farmers at the market, and avoid buying from the mall. This takes an extra effort to get there, but it’s not much more expensive, is healthier, lets us actually talk to a human being instead of a machine and helps us catch some fresh air and natural light.

        I’m so fed up by this computer-based way of life… (but that’s another topic).
        I predict a shift in humans’ behaviour: from computers back to real life!! (or at least I’m hoping for it ;-))

        • Thanks. I know price is a difficult thing right now, but if you look at it long term you know that most camera companies are going to replace the existing model in 18 months, some companies in 12. We are planning on making other cameras, but not ones that make the D16 obsolete, ones that are just different shooting options. We are trying to make the camera as future proof as we can, and I think we have done a good job picking the elements to do that. So in that way it’s much cheaper, but I understand that the reality is money tomorrow is not the same as money today for many people.

          • There must be an alternative business model, one that makes money from selling usefull accessories and upgrades to hard- and software, instead of essentially selling the same product, deprived of some of its evident faults, to the same people every 1-2 years.

            (Though I note that to a certain extent, you depend on TrueSense for upgrades).

          • I think there is a very healthy business model available to all companies. Provide quality products and accessories at a scale and rate that will make you profitable without over extending and support the community that uses these products. It’s pretty straight forward. It’s just when you’re board of directors decides it’s more important to show fast growth than long term dependability that there are problems.

  13. Thanks for posting this. It gives a good bit of perspective. Innovation is hard in any environment; I can barely imagine what it’s like when people are actively working against you.

  14. This is a great post Joe. I really, truly hope it is the little companies, the ones who actually care about its customers that survive and thrive in this world of massive conglomerates. I love what Kickstarter and in Canada, IndieGoGo, are doing for this space. I hope more companies and products come from folks like yourself and Elle. We really need it.

    • Thank Ryan,
      We think so too! I hope that if we make a successful company it will encourage other people to try it too. This is an exciting time for filmmakers and entrepreneurs 🙂

  15. This is such an important sentiment. I cringe when I hear my friends use a “price point” as the main factor in their gear purchases, without regard to what may be influencing that price, or what other effects their purchase will have for other purchases they might need down the road.

    Sometimes it’s just worth paying more for a better item.

    The truth is, even if I didn’t have a project to shoot with a Digital Bolex, I’d still want to work in an industry where a camera/company like this can thrive. Just as I hope there are others, differently specialized, who can do the same. Sinking all our attention and money into a few boring behemoth companies is unhealthy for the business, and for the artform.

    Thanks for sharing this, Joe.

  16. A very valuable post indeed. Money needs to be put where mouths are. Famous life coaches, authors, speakers make a (somptuous) living out of talking about entrepreneurship, start ups, motivating people to be creative, be the best, “live the dream”, etc. More attention and money are thrown their way than invested in actual projects and products designed to offer relevent solutions to collective issues and to make the world/business world a better place.

  17. Pingback: » Funding complex R&D without an existing product line – Digital Bolex

Leave a Reply

Your email address will not be published. Required fields are marked *