Two weeks ago we sent out an email to our customers letting everyone know that our production line had been delayed due to third party interference. Today we have good news! Shipping and production on the D16 has resumed, we are shipping cameras again!
When the D16 originally went on sale in December, the response was overwhelming, and we want to thank everyone who believed in us and placed orders. For a small company like ours, voting with your dollars means a lot to our continued success and ability to create innovative products for filmmakers.
We started shipping Kickstarter cameras at the end of last year, and more than 2/3 of our backers have received cameras so far. As we ramped up our production line through January and February, producing more and more cameras, we had reached a sustainable rate; we were ready to finish Kickstarter delivery in February and begin shipping the new orders in March, right in our 8-12 week delivery estimate.
As those of you who have purchased through our store know, we use PayPal to process our payments, as they have a proven track record of safety and reliability in online transactions, and can be used internationally. What we didn’t know when we created our merchant account with Paypal is that they also have track record of freezing accounts for little or no reason, and making companies go through major hurdles to access their funds, which can be held without cause for up to 180 days.
In mid February, one of our Kickstarter cameras went missing for a few hours due to an error with the receiver’s address on file with UPS. While we were tracking down the package, a concerned pre-order customer called Paypal to ask them what would happen if their future package was lost by the carrier. The Paypal employee, misunderstanding the situation, filed a non-receipt complaint on behalf of the buyer, which triggered a hold on our account until all tracking numbers for each ordered camera were input into their site–hundreds of orders. The buyer contacted us right away to tell us what happened, and he cancelled the complaint almost immediately, but it was too late. PayPal’s system is partially automated, and without adding those tracking numbers into the system, we could not access our funds.
Our PayPal merchant account manager, who had reviewed and verified our business plan and production cycle back in December, had initially requested we leave the majority of our funds in our Paypal account for security reasons. We complied, so when the account was frozen, so was our ability to pay for the parts we needed to fulfill our orders. We continued to build and ship as many cameras as we could through March with the parts on hand while we worked with PayPal representatives to rectify the situation. Part of that process included shipping a handful of the pre-sale cameras to input their tracking information into the system instead of fulfilling the remaining Kickstarter orders, which is not something we had planned or wanted to do. We sincerely apologize to our Kickstarter backers for this inconvenience. After the hold occurred, fixing the situation became our #1 priority, taking precedent over every other task in the office, including the finalization of international shipping. We were on the phone every business day with a succession of PayPal employees, and getting through to the highest level of PayPal representative took almost six weeks. They finally released our funds the last week of March, allowing us to pay for new parts, which have now arrived in Toronto.
We started building cameras again last week, and shipping starts back up today. It’s very frustrating for us that we were not able to hit our target ship date, but we are confident in our ability to finish shipping our Kickstarter cameras ASAP and begin delivery on the rest of the pre-order cameras in coming weeks, and we also feel confident in our closer relationship with PayPal and do not anticipate any future hiccups.
Thank you all for your patience and believing in us during this time, and for getting in touch if you have had concerns. Many of you already know the situation, but we wanted to make the delay public so that other online businesses might be able to avoid a similar problem happening to them in the future. There are a lot of horror stories online about PayPal, and while this was certainly frustrating, their representatives worked very hard to give us access to our funds as quickly as possible under their terms of service so that we could continue to fulfill orders.
We are delighted to see all of the amazing projects those of you who have received your cameras have created so far, and the overall response at NAB this year solidified our place in this very full market. The professional world is learning what a valuable tool the D16 can be, with some very exciting filmmakers already adopting the camera for major productions, and we can’t wait to get the rest of our orders fulfilled and see what all of our camera owners do with their D16s.
Let’s make movies!
With great gratitude, Joe, Elle, and the Digital Bolex team