Important news regarding the OGR group buy:
TL:DR PayPal has left me in an impossible position, and rather than spending months disputing it I’m refunding everyone’s payments. I will be relaunching the GB again using Stripe once refunds have been processed and cleared. I’m very sorry for the inconvenience to everyone but I hope to make it up to you.—
In the interest of transparency I’ll include as much detail as I am comfortable with (basically all detail but the exact numbers).
Initially the plan was to use Stripe as the sole payment option for this GB but after hearing that raffle systems of any kind were against their ToS (whether as part of the payment process or not) I was forced to consider other options. I’m familiar with PayPal’s UI so I got in touch with their sales team a few weeks before the GB to explain my situation and the circumstances surrounding this sale. Given that my account is a fully verified business account with a little history already, I was advised that as long as it was made abundantly clear on the website that this was a pre-order sale and that the lead times were also stated I wouldn’t have any issues.
Fast forward to the GB and when the payments started rolling in, after the first £10,000 or so came in my account was flagged. Given that this was Saturday night I couldn’t do much about it, and as it was the Jubilee weekend the UK customer service line wasn’t actually open again until the following Tuesday (7th); the payments were still coming in so there was no immediate cause for alarm, I figured it could be easily cleared up when I get in touch.
I called on the 7th to try and get some clarification for what’s going on, and what I could do to both give PayPal confidence in my process and thus remove the flag. Not much was said on the phone initially other than I would be given some instructions on my account, and once those were satisfied I would have full access to the funds. I was asked to verify some details regarding my company and to provide ID (all of this information was already on my account so it was a little baffling), as well as providing proof of purchase with the suppliers/manufacturers and also shipping tracking numbers for all transactions to date. Obviously due to the format of this sale it isn’t possible for me to provide these details so I called again, and initially I was told that there is no wiggle room in this and if I can’t provide those details then my funds would not be cleared.
I escalated this up the chain as I was caught in a frustrating catch-22 (the first of many) and eventually I managed to speak to someone who understood my situation, and he heard my case and said PayPal would be back in touch soon with further instructions, and once these are completed I will have my funds released. On the 10th I received instructions to explain my business and what it does, my business plan, my expected costs/profit margins on this sale and also to list the contact details of all suppliers involved in the production of the OGR. As frustrating as it was, I figured that a week turnaround on clearing up these issues wasn’t too bad so I just rolled with it and submitted the info the same day.
By Wednesday 15th I still hadn’t heard any update so I called again to chase with PayPal. Nothing noteworthy on this call but it prompted them to update my account. The flag notice was removed but the restriction was still in place. So I call again, speak to another agent and this time I’m met with a brick wall, where I’ve done as they asked every time but they continue to throw more hurdles in front of me. This time they didn’t specify any instructions, they just said that there’s nothing they can do. At this point I suggested that I get final invoices from a few of the suppliers (cases and pcbs, the largest bills) to show them as proof that I’m waiting to start production and this isn’t an elaborate exit scam. They said this would be sufficient evidence (again) so I obtained those invoices and submitted them to PayPal.
On Friday 17th the flag was finally lifted on my account, and instead they imposed a “reserve” on my account instead. My balance showed a portion of the overall amount as available funds, but around 80% of the revenue was held by PayPal. They didn’t mention this would happen at any point so I had to call again to find out what was going on now. They explained it was due to potential chargebacks or refunds, but I have accepted every refund request without argument til now, and you could speculate that holding my money and essentially doubling the lead time would surely guarantee more chargebacks in future so again I was put in an impossible situation.
This time I truly hit a dead end as I had spoken to multiple agents and was met with the same response every time:
“There’s nothing we can do. Your account is eligible for review in February 2023”. I issued a complaint through the site and was given the same response. I took the weekend to try and work out a plan and the best idea I had at the time was to speak to a financial advisor, to see if they had any insight that I didn’t consider and they advised that I speak to a financial ombudsman.
I did that on Tuesday 21st, and they understood my situation entirely and explicitly said that while their actions can be covered by their terms and conditions, they aren’t all necessarily legally binding so with some legal pressure they can change their position. The issue is that even with a financial ombudsman fighting my case, the process will still take months with no true guarantee of a resolution in my favor.
So I took a couple days out to weigh up my options and I came up with three realistic choices:
- Wait it out, pray that PayPal cuts me some slack in February and surely piss people off in the process.
- Try and take out a business loan with a bank, but interest rates are really high so I may end up losing money in the end and I’d rather not be beholden to the whims of 2 financial institutions. 1 has been more than enough so far.
- Be honest with people, refund their orders in full and start over using Stripe.
So my current plan is to refund everyone on PayPal starting this weekend, this might take me a couple of days as I have to do them one by one. I’ve done a couple of refunds for the mod team and their money hasn’t cleared immediately so I’m going to give it a couple of weeks before re-launching the sale, just to ensure that all people who want to purchase again will have ample time for their refunds to fully clear.
I will then relaunch the sale using Stripe instead of PayPal. This means that in order to keep them happy there will no longer be a raffle system and instead it will be a FCFS sale. I understand if some of you will no longer be interested so with the aim of giving everyone the fairest shot possible this time round I will be putting a soft cap of 250 units next time round. I’ll need to work out the specifics of the sale but once the PayPal refunds have been processed I’ll then make the move over to Stripe. I’ll need a few days to implement the plugin and test accordingly so I’ll make a further post later once those details are final.
I just want to say I’m very sorry for this disappointing outcome. I wanted to approach this GB with relative transparency but I didn’t want to let you know while I was still in the midst of it, and I wanted a plan ready rather than leaving it up in the air. I fully intend on seeing this GB through to completion and fulfilling my obligation to all of you. I hope you all can understand and appreciate my position, and I hope to see you all ready when the GB relaunches soon.
