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A San Francisco-based drone startup that raised $34 million in pre-orders folded on Thursday, the same day the company, Lily Robotics, was sued by the local district attorney in county court.

The city accuses Lily Robotics of engaging in false advertising and unlawful business practices.
The company’s story is reminiscent of the now-defunct Torquing Group, a Wales-based firm that raised $3.4 million (the largest European Kickstarter project to date) to build a drone called the Zano that ended up not going anywhere, either.
In 2015, Lily Robotics released a slick YouTube promo video demonstrating its drone, calling it the world’s first “throw-and-shoot camera.” It received widespread, breathless coverage from various other media outlets, ranging from Wired to TechCrunch. Lily Robotics’ founders were named on the “Forbes 30 under 30” list in 2015.

And in addition to its pre-orders, the startup took in $15 million in venture capital, according to CrunchBase.


As District Attorney George Gascón alleged in the civil complaint:

Despite taking all of these prepaid orders, Lily Robotics has continued to delay shipment of the Lilys. When defendant began accepting preorders in May 2015, it told customers that the Lily Camera would ship in February 2016 or May 2016, depending on when the preorder was made.

Then, in December 2015, Lily Robotics delayed all shipments to “Summer 2016.” It delayed shipments again in August 2016; according to its notice, US customers would get their Lily Cameras in “December 2016 to January 2017,” while its non-US customers would get them sometime “later in 2017.” As of the writing of this Complaint, not a single unit has been shipped.

In a Thursday statement, the company did not address what went wrong, only saying that it was “sad to see this adventure come to an end.” The startup did not respond to Ars’ request for comment.
In addition to the lawsuit, a local judge in San Francisco granted the city’s request to impose restrictions on the company’s bank accounts, requiring that they only be used to pay employees and issue refunds.
The two sides are set to appear before Superior Court Judge Harold Kahn on January 18.

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