The Ion Productions Team – What Happened

2004

Ion Productions began way back in 2004, as a group of unpaid high school students in metro Detroit who collaborated on PC video game projects in their spare time, led by Chris Byars.

Time became short as each of our lives became busier, and development slowed and stopped. It was a huge learning experience overall, not only for software development, but for project management.

Aside from software ideas, there were constant sketches and concept writeups for physical products – most impractical, some impossible, but one attainable – the XM42 Flamethrower.

Ion Productions began way back in 2004, as a group of unpaid high school students in metro Detroit who collaborated on PC video game projects in their spare time, led by Chris Byars. Time became short as each of our lives became busier, and development slowed and stopped. It was a huge learning experience overall, not only for software development, but for project management.

Aside from software ideas, there were constant sketches and concept writeups for physical products – most impractical, some impossible, but one attainable – the XM42 Flamethrower.

2008

The original drawing and model looked terrible. In fact, the original flamethrower concept was prototyped using PVC and a hand pump system to pressurize a reservoir, like a squirt gun. It didn’t seal well, it didn’t look good, but it did blast a stream of water, and building something that mostly worked the way you intended was a reasonable success.

2009

Chris began research into an on-demand setup without needing a pressurized reservoir. He put together a simple fuel tank and miniature pump setup, powered by AA batteries. Multiple iterations were built and tested with denatured alcohol.

He quickly found that the pump used was incredibly inferior, and had no method for preventing gravity from draining the reservoir. This meant when the test rig was used, the entirety of the reservoir would continue to leak out even after the pressurized stream emitted. With his roommate recording, the flamethrower inadvertently make a lake of fire in the grass outside of the dorms, but luckily it went out quickly on its own.

The system worked, but it wasn’t optimized.

Chris began research into an on-demand setup without needing a pressurized reservoir. He put together a simple fuel tank and miniature pump setup, powered by AA batteries. Multiple iterations were built and tested with denatured alcohol.

He quickly found that the pump used was incredibly inferior, and had no method for preventing gravity from draining the reservoir. This meant when the test rig was used, the entirety of the reservoir would continue to leak out even after the pressurized stream emitted. With his roommate recording, the flamethrower inadvertently make a lake of fire in the grass outside of the dorms, but luckily it went out quickly on its own.

The system worked, but it wasn’t optimized.

2015

Six years later, with years of mechanical engineering experience, networking with machinists and welders, and research, an all-new prototype XM42 was fabricated.

In January 2015, The Ion Productions Team, LLC was filed.

The goal was to make the old dream of designing and manufacturing awesome, unique products a reality. In March, Chris partnered with his good friend Jim and Tony to collaborate on an Indiegogo crowdfunding campaign. We reached out to various news agencies just before launching, and it worked. The campaign was successful, surpassing the $40,000 requested funding overnight, and ending with $157,000.

Numerous news interviews later, countless e-mails in support as well as disgust, production began. Chris rented a small portion of the office area from his machinist friend. There he assembled, tested, and shipped every flamethrower himself by hand after work, with weekend help from his family and girlfriend.

By September, it was clear that this project was beginning to demand more time than he had to spare on nights and weekends. Chris quit his engineering position and moved to work on The Ion Productions Team full-time, hiring two of his friends and leasing a ~1,000 sq ft flex space to produce as many flamethrowers as quickly as possible.

2016

We negotiated a contract with Prepper Gun Shop, with them being our exclusive distributor, ending direct flamethrower sale by us. All of our orders from that point forward were based on a year contract, prepaid, produced and shipped on a monthly basis.

Things ran relatively smooth.

2017

We move to a larger facility in Arizona, bringing welding in house to maximize our quality control, oversight, and capabilities.

The contract with our distributor is near its end, and they are overstocked – not interested in buying any more standard XM42s, however, we’ve existed up until that point on a prepay basis, and need the cash flow to survive. We pitch the idea to develop a vastly improved iteration of the XM42. Our distributor covers our overhead and prototype costs throughout 2017 as we develop the XM42-M.

 

We realize our current building is too small to adequately set up the production line on the XM42-M, and lease a new, larger building with land that we plan to use for videos, events, and testing purposes.  We also need more hands on deck to handle the volume we’re producing, and hire 3 new employees to help assemble as well as one full time welder and one part time welder. Meanwhile, we’re still working on securing a solid 12-month contract that would generate plenty of funds for us to survive on.

We move in, working through the weekend to transport everything from our old shop to the new, and build additional tables and racks and set up our equipment. Production begins, and the XM42-M starts shipping in November.

We negotiate a contract with the distributor at the best price we can offer, the only one they would agree to, with no profit to us, but it only covers 3 months’ worth of shipments. At the end of this contract, we have nothing in the bank, and large monthly repayments for the funds they supplied us over the course of 2017 during development. We hope that the XM42-M sells enough to warrant a continued contract, otherwise we need to find a way to sell to another buyer – and fast.

2018

January

  • We receive the last of the distributor’s order payments in January. Per the contract, we are only able to seek alternative distribution options one month from the last date that they place an order.
  • We attempt to convince them to purchase product throughout the month of January, but are unsuccessful.
  • We attend SHOT Show to attempt to boost exposure and sales
  • We acquire a billboard in one of the busiest sections of highway in downtown Phoenix
  • Elon Musk introduces a “flamethrower” at $500 and sells 20,000 in 4 days

 

 

February

  • We design and quote a small economical version of our flamethrower called the XM42 Lite to expand our market after seeing what Elon was able to do.
  • We reach out to distributors directly to try to negotiate large sales with, but they all turn us away.
  • We were approached by Info Wars regarding carrying our product, which we expected to be a large sales opportunity.
  • We initiate contact with our bank regarding obtaining a line of credit to produce our products ahead of time rather than prepay batches; it seems extremely likely we will be able to get it. We were told our income was good and the amount we needed was typical. They require taxes for the last 2 years, and ours aren’t filed.
  • We have multiple news station TV interviews showcasing our products and hopefully driving traffic to us
  • We run a poll on Instagram teasing the XM42 Lite, asking “If we ran a pre order for $399, would you buy one?” and 950/1000 respondents said yes.

 

 

March

  • We open pre-orders on the XM42 Lite, expecting a vast number of sales based on what Elon Musk was able to do, but turns out it’s an exposure problem, not a price problem. Our product was infinitely superior, for less cost, but still, our brand awareness is not as high.
  • We continue to work on finding distributors and sales opportunities with large retail chains, but nothing goes anywhere.
  • We send sample products to Info Wars. After shipping 5 XM42-Ms for free as well as accessories (paid), they stop returning our calls and e-mails.
  • We meet with a CPA and begin organizing our financial information for 2016/2017

 

April

  • Pre-order sales are not as high as expected (< 100), making our ability to build the 600 qty batch that was quoted to achieve that price uncertain
  • We reach out to a highly regarded national sales team to partner with since we cannot seem to successfully meet directly with distributors ourselves
  • We introduce a monthly giveaway to help drive sales
  • We struggle with income and cash flow forcing us to lay off the majority of the team as we continue to try to achieve a line of credit/loan/investor.

 

May

  • We signed an agreement with the sales team to be our sole reseller sales channel, but all orders are Net 15, and we aren’t sure when we can build, as it depends on us achieving financing. We instruct the sales team to not take orders yet, as we don’t know 100% when we can ship product.
  • Taxes are finally complete and sent to be filed
  • We provided our bank with all information requested to consider the line of credit, including $450,000+ in pending unpaid orders from distributors. A week later we get a letter in the mail saying it is declined, mostly due to our bank balance being too low. (That’s why we’re trying to get the line of credit…) They ignore all further contact.

 

June

  • We ship accessories and display stands to Info Wars and are promised they are to be making videos and promotional ads for our products. Nothing happens. They refuse to answer our emails or voicemails.
  • We put together company information and seek angel investors to take 90% of the company with a plan to achieve ROI in 6 months, and a 1.2+ million net profit in a year. There is interest shown by a few, and we tried to discuss the details further, but they all backed out at the last minute.

 

July

  • We offer the company to a friend of our torch supplier’s, but they back out.
  • We meet with an investor in regards to his interest in potentially buying the company outright as a fallback plan if we can’t find any other investors. After poring through our business data and all financial information and reconciling it for a week on-site, he leaves, telling us everything looks good so far, and his timeline is 2 weeks – first week to verify our bills of materials, discuss debts with creditors, and then the next week to put together the legal documentation to buy the business. We are 99% sure he will do this.

 

August

  • The buyer says he is not moving forward with the deal. We didn’t expect that whatsoever. We asked if he would take the company for free, and it was still a no go.
  • We reach out to big name companies in the industry, anyone we can find to try to get interest in taking the company. None are able to.
  • Our distributor had security interest in our company’s physical and intellectual assets regarding the large loan they provided us, and decided to file a demand for payment or the collateral. We obviously can’t pay. They seized all physical and intangible assets on 8/13.

There’s nothing in our shop, and all IP is now owned by them. All parts and inventory are gone; we physically have nothing, and have lost the ability to fulfill the small number of pending orders or any future orders or requests. We lost our business and our livelihoods, and are left with massive debt and empty bank accounts, selling what we can to stay afloat while seeking employment.

Everything we expected to happen this year went the complete opposite direction. Still, we kept trying as hard as we could, because we believed in the product and that our persistence would pay off. We fulfilled every order we could with the materials we had on hand and spent everything we had on continuing the business. Eventually there was nothing we could do to keep the company up.

We advise the few customers with pending orders to file a dispute with their credit card company or bank for unreceived merchandise. Yes, some orders have been beyond 60 days, but since the shipment was delayed, they should work with you.

We are so sorry that things turned out this way. We never thought this would happen. While the company was around for 3.5+ years, it was still our first time running such an operation. Knowing what we do now, in hindsight, we would have done many things differently, but at every point throughout the process, we remained optimistic and made the decisions we did based on what we knew at the time. We expanded too quickly, based on expectations that weren’t guaranteed.

We thank you so much for your support over the years. From napkin-sketch, to CAD model, to real physical product, it was an amazing experience before things started heading downhill. The XM42 was used in the Jumanji movie, a Hormel Chili video, an official Star Wars video, multiple music videos, and more. To see people enjoy and love a product we created was the best feeling.

We have customer information saved and will try to make it right with those left unfulfilled in some way in the future.

 

For now, it is the end of The Ion Productions Team.