Mu Optics Officially Out of Money

After months of silence following the IMTS 2014 show, Mu Optics has released a lengthy update on IndieGoGo.  Some have speculated that the delay in refunds lately suggested the Mu coffers were nearly empty.  Today, John McGrath confirmed this fact, saying "Regretfully, just as our camera was ready for production, we're now finding it impossible to obtain financing for production...It would only be fair to say that, baring a miracle, that we are shutting down operations."

The update rightly points out that the entrance of the Seek imager has further changed the new consumer IR camera market, with the FLIR 1 being the first one on the scene.  John admits that while competitive with the FLIR 1 (which isn't entirely true in my estimate), the Mu camera cannot compete with the likes of Seek at their price point.  Having received my Seek camera the other month, I can say it is what I hoped the Mu to be at the beginning of the campaign. 

The announcement brings up a big question, if they still need financing to get the Mu camera to production, how far was the $282,000 raised during the campaign supposed to get them?  Clearly, some was for development of the final camera, but it seems clear now that they could not have delivered cameras to the IGG backers with just those funds.  The failure is probably due to not accurately calculate their BOM costs.  Mu has always keep things close to the chest (out of their self-admitted paranoia as I talked about in the earlier post), but they did reveal an interesting figure in their update: cost of manufacturing one Mu unit is $210.  Starting with the 1,905 IGG backers, that would mean production cost just for the campaign fulfillments would be $400,260.  A simple math check shows this is considerably more than $282,000.  We have no idea how much was spent on development of the app, hardware, labor costs, but those efforts likely ate up a large portion of the funds. 

And so here we have another case study of crowd-funded projects that are a great idea but poorly executed.  It further goes to show that the step from working prototype to full production is a considerable undertaking that should not be underestimated.  Making a product work is the first step, but you still have to design it to be producible at a reasonable cost.

Instead of disappearing after the failure of the project (I'm looking at you Steve Tan, aka Kreyos), John has provided his personal contact information for people to contact him. Certainly a respectable thing to do in those circumstances. I'm sure that there are a lot of disappointed and angry supporters who will not get refunds (despite asking) who will take advantage of the opportunity to contact him. But, baring a miracle angel investor, Mu is officially dead.