Pando

According to SEC filings, Tellspec's $1.5m funding round actually only raised $25k

By Paul Bradley Carr , written on March 23, 2016

From The Money Desk

Well here’s a funny thing.

Back in November of last year, I wrote about Tellspec’s attempt to raise additional funds on Crowdfunder.com for their widely discredited magical food scanner. The company was already almost two years late in delivering a product to its almost $300k in crowdfunding backers and, according to their crowdfunder profile, they needed $1.5m just to begin production.

Of course, this being Tellspec, nothing was as it seemed. As I wrote at the time, the company’s fundraising prospectus was full of misstatements and non-existent partnerships. Worse, the parts that were true indicated that the device was even less functional than backers had previously been told.

Following our reporting, Crowdfunder.com pulled the campaign. Shortly afterwards, Tellspec’s CEO, Isabel Hoffman filed several DMCA takedown notices against our web host. The takedown attempts were unsuccessful.

Still, according to Tellspec, at the time the campaign was suspended, an impressive $1.2m had already been reserved by investors. Not quite enough to begin full production, according to the company’s own math, but certainly a fair chunk of change for a company with so many red flags.

Crowdfunder.com connects investors dirctly with companies meaning even though the campaing was taken down, the money so far committed would still be safe. Of course, Crowdfunder doesn’t actually take any steps to verify the legitimacy of the “reserved” investors -- they leave that down to the company.

And wouldnt ya know it. Earlier this month, Tellspec filed a document (embedded below) with the SEC disclosing the amount raised in their recent fundraising. It is the sole document filed by the company in relation to the round. The actual tally?

Not $1.5m

Not $1.2m

Not $0.2m

$25k.

Twenty five thousand dollars.

In other words, according to Tellspec’s own SEC filings, the total they boasted on their Crowdfunder page was yet another total fantasy.

As usual, the real victims here are the poor old Indiegogo backers who are still, still, still waiting for their food scanners. By its own admission, Tellspec needs to somehow find $1.475m more just to deliver what it already promised.