The pre-sale is to get enough cash in hand to pay the manufacturing outfit enough to do a production run in order to fulfill the pre-sale orders. If you send money to FG for a pre-sale, you are gambling that they will use your money to actually make a device and deliver it to you.
That is Arrington's warning in point 5, and it is a valid warning. Even if they don't use the pre-sale money to hire lawyers, there is no guarantee they will get enough money to do a production run, there is no guarantee they won't take your money and disappear.
Pre-sales is based on trust (buyer) and reputation (seller), not goods already manufactured.
The emails talk about shareholder investment; if that is the case they can pre-sale while they are building the first batch on investor money. This way they get a share of the Xmas market rather than launching in the January sales (always a bad move).
With all that said nothing about DG has shouted "marketing sense" :)
We sell units like that.
FG have said they have devices built or building haven't they? I wonder which is true - my guess is a small inventory, hence the pre-sale.
Chandra and Fusion Garage have shown a long term pattern of deceit in their business dealings.
Dear god.... why oh why did he deal with them? (or continue to deal with them)
If the lined up investors, guys who make a living in picking horses to back, were worried why didn't Arrington listen to their concerns
And after a brief scan through I dont see any/many mention of contracts or agreements between TC and FG. As we said before that is a basic mistake - and it looks like it is one that was actually made :(
Personally I am coming down slowly on TC's side: Fusion Garage are screwing about.
However the one thing I am certain about now is that I would definitely never go into business with or invest in Arrington. He's destroyed any reputation he had as an investor / businessman for me.
Shambles.