so did they or did they not have a running prototype? it seems they did but then they wanted to develop another more expensive product.
the story reads like they started r&d after getting the money. _all_ r&d including case manufacturing options(yes there are other options than injection molding and 3d printing, which are all pretty much cheaper in their unit range) and all code for the micro and choosing another micro..
I mean, how the fuck can you spend so much more on your r&d that you were supposed to already have been done?
furthermore, they didn't design the product to the means they had available - for example, if you're a low run and injection molding tooling is too expensive(and you know that because you've done a cursory google search beforehand, right, right???) you can get of the shelf aluminium cases and such quite cheaply. sure it's 5-10 times more expensive per unit than injection moulding but still would be under 10% of the 99 bucks. lasercutting etc would all be options - they would just have had to compromise on the overall shape of the frigging device. like, fuck, http://www.alibaba.com/product... here's a box 3 dollars + cheap ass shipping. or a bunch of other similar boxes, extrusion they could have cut etc. then the cheap ass method of pcb for the ends( cheap cheap in low run too) to hold the display, buttons etc.
fuck you could even source them as 3d printed pieces nowadays cheaper than the quoted 25$ per case due to the tooling.
really, the whole story reads like they didn't do the development beforehand and promised stuff out of their asses. they wanted to change the product to a more expensive one and do the r&d again after the kickstarter while the kickstarter should only have had to pay for the production of what they already demonstrated.
whats even worse? they're using this as a publiciy stunt for their smartphone apps! that is they have a revenue source, they're an existing company, they just blew a lot of customers money on paychecks to themselves and didn't deliver.