Something Jed said about customers spurred a thought about customers, investors, and the difference between them.
Customers exchange money for something that meets a current need. That can be a need to use a device, a need to gain access to technology early, or even a need to do some good. But in any case, there is a contract (implicit or explicit) for an exchange of values. The process of purchase is relatively rational, and relatively reversible. The return to the customer is relatively predictable. If the item purchased is grossly different from product specified or advertised, there is broad recourse under common and contract law. It's pretty easy to scam a customer if you only sell one item and flee, if you sell items so cheaply that the duped find the cost of recovery higher than the value recovered, or if the item sold is actually illegal. But selling large industrial equipment to a knowledgeable customer with a large legal department, in the hope of then selling them another one in three months is a scammers nightmare. Investors exchange money for an unknown future return. Business plans typically change radically as they encounter reality, unknown unknowns dominate the landscape. Decisions to invest are often irrational, emotional, and have less to do with physics than with hope. Investors are the ideal targets for a scammer: they are already dealing in intangibles and the time lines are long and the opportunities for the scammer to exit, stage left, are numerous. Investors are making high risk, high return bets. When we discuss the flow of money here, I think we should be clear about the role of the customer vs. investor, and draw conclusions as appropriate. Steorns actions are entirely consistent with wishful thinking on the part of investors and entrepreneur (if not an outright scam); Rossis actions are entirely consistent with a bold attempt to bootstrap a business on personal capital and customer sales. Rossi's business plan is currently and _clearly_ centered on customers. Let a system be evaluated, sell it on a returnable contract, expect to sell more units because the product itself generates a return on investment (if not for the first unit, then in a predictable fashion as a customer understands how to proper deploy them). This is not a scammers plan. I've been down this road (smaller scale, less impact on the world, to put it mildly) -- he's doing _exactly_ what I would do if I had the idea, the technology, and the courage. Mind you, I think I would spell better, have a cooler website, have better PR, and be a little more precise in my business language. But I'm not the guy who has the problem.
