Berlin-based guitar pedal developer MOD Devices (MOD DUO X & DWARF) is bankrupt and is trying to reboot with a fundraising
We are in strange times with “still” pandemic, chip crisis, war, inflation, etc. Just recently, Eurorack developer WMD fell victim to these events and announced that they will close down their activity until the end of the year. Very sad news, and just before Boutique synth developer Future Retro also announced its end.
Times don’t seem to be getting better. Now a well-known guitar pedal manufacturer has announced the end. The Berlin-based company MOD Devices, creator of the open hardware effects platform, has announced that is currently bankrupt.
MOD Devices Bankrupt
MOD Devices have developed hardware pedals based on an open platform. On which not only effects but also synthesizers, MIDI devices, and more can run. The platform is even open to 3rd party developers. A very exciting project with constant new additions. This quick end comes as a surprise and, unfortunately, clearly shows the difficult times we are currently living in.
Gianfranco Ceccolini, head of MOD Devices, says that they list losses of more than 1M€ from founders, another 1M€ or investors, 287k€ from the Seedmatch crowd, and 177k€ from backers. Several factors have now brought the company down, including a combination of global supply chain issues and a failed crowdsourcing campaign.
Dear MOD community members
I am sad to announce that MOD Devices GmbH has reached the end of its line.
This is the result of a two-year crisis that started with the COVID impacts on our supply chain in Q2/2020, and the snowball effect of the cash flow disruption triggered by the failure of the Crowdcube campaign in Q4/2020.
During these last 24 months, the founders and shareholders have bridged the finances multiple times in failed attempts to get back on track. But the private cash from shareholders only is not sufficient and, with the worsening of the general economy and growing fear from financial institutions and investors, the remaining financing options have all retreated, forcing me to file the company for insolvency.
It is not the end of MOD though. Not yet.
Part of the founders, team and shareholders believe very much in the project and a reboot is being put in place, with the fundraising for a fresh company.
Gianfranco Ceccolini and his crew are planning a reboot with a crowdfunding project, etc. He emphasizes that the next two weeks will be decisive for the future of MOD Devices. They plan to remove The MOD Duo X and will focus on the Dwarf.
You can read all the details on their financial problems, reboot plans, the undelivered units… at their official forum. I wish the team all the best. Hope the company makes a quick comeback because they have built a powerful platform with which developers, as well as players, can do a lot.
More information here: Mod Devices
There seems to be a bit of mismanagement here, as this cannot be blamed solely on the pandemic and the ensuing supply chain issues that have plagued many industries. For a small operation, they were well funded and had adequate financial support.
This is unfortunate. I’d been considering a MOD DUO X or a Dwarf, doing a bit of research, and I was impressed with the concept behind the products. Hope these closures and bankruptcies don’t continue to be a trend for the smaller gear companies.
Who knows? Assuming the new effort gets enough backing, maybe it will be stronger for the lessons learned from the first time round.