Hey,
I want to share a company update that’s long overdue.
Many of you are upset - you feel left in the dark, unsure what’s going on, angry about delays, etc. You deserve complete transparency about what’s been going on.
After exploring every possible option over the past several months, we're closing the doors on terrashroom after 3.5 years. This wasn't a choice we made lightly, and I want to share exactly what happened and what this means for you.
This post is going to cover the following:
-What happened
-Who is affected
-Addressing concerns + founder's note
-What this means going forward
What happened?
Terrashroom started as a weekend hackathon project in early 2022.
I bought a 3D printer, an Arduino microcontroller, and locked myself indoors for 3 days until I had a prototype.
What seemed like a straightforward idea turned into an incredibly challenging and complex venture.
The Reality of Hardware Development
When we started, we hired a product design agency - we were told this would be a "pretty simple project" costing around $40k for R&D and mold tooling with a 4-month timeline. The reality was dramatically different:
-R&D costs ended up 10x higher than projected
-Tooling costs were 7x the original estimate
-Manufacturing costs 5x per unit over original estimates
-The 4 month timeline stretched to nearly 3 years
We learned the hard way that creating a consumer IoT product with hundreds of components requires everything (mechanical, electrical, firmware, software) to work in perfect harmony. When one piece fails, the entire product becomes unusable, especially when growing delicate mushrooms.
The Challenges We Faced
Outside of manufacturing hurdles, we encountered obstacles we never anticipated:
-Multiple Shopify and Meta platform bans due us being classified as "controlled substances"
-Merchant accounts freezing funds repeatedly
-Shift in the mycology landscape - consumer interest in growing mushrooms receded
-Manufacturing & engineers partners who failed to deliver on promises
-Rising costs to conduct business & manufacture product
-Product issues & low device utilization after launch (72% of customers stopped using their terrashroom within the first few moonths)
-Shift in fundraising landscape - significant funds to consumer hardware
What happened to the pre-orders?
Here’s an overview of what happened & who was affected:
-Approximately 3,514 customers paid for a $49 pre-order deposit.
-Approximately 1,785 customers placed a full pre-order (an overwhelming majority of these paid the remainder from their pre-order deposit).
-We fulfilled roughly 1,040 of these pre-orders.
-We refunded approximately 500 customers.
Addressing accusations
With the silence, there’s been rumors going around on the internet. I want to address them to provide clarity & bring closure.
1. “Terrashroom scammed 25k people out of their money!”
This is a confusion that references our email waitlist size. This number represents people who visited our website and entered their email (no funds were exchanged).
See above “What happened to the pre-orders?” for a breakdown of transactions.
2. “Jared took all of our money & is sailing away from the US!”
This accusation came up after an investor noted my condition & recommended that I take a month off to recover.
The last time I left the US was back in October 2024 to visit the manufacturing facility in China. I have been on US soil (or in this case, waters) ever since.
I posted on a sailing facebook group to crew (i.e. deckhand) for a month. Having not paid myself in months, it seemed like an inexpensive way to reset (you generally get free room + board in exchange for helping with boat duties).
Ultimately, I decided against this and chose to stay in Austin to work.
3. “You used customer funds to live an extravagant life!”
The DNA of terrashroom has always been scrappy & resourceful.
To remove any doubt & clear this accusation, my personal gross income from terrashroom for the past 3.5 years was $74,706, or about $6/hr (we worked 80+ hour weeks).
I've slept on friends' air mattresses for 6+ months, poured my savings into R&D, forgone health insurance. and made significant personal & financial sacrifices to keep every possible dollar in the company. The truth is, hardware product launches rarely go as planned & sacrifices are required.
Personal Note from the Founder
This segment is to give clarity + answers from the founder’s perspective. Since there’s been a lot of accusations, this will add a level of humanity to the situation and provide additional clarity.
1. Why the silence?
First, I should have communicated something, literally anything, sooner. Truthfully, I didn’t have many answers myself or clarity on where things were going. I fully own up for not saying something sooner.
2. Post MP1 team change
Weeks after shipping out MP1, the engineers decided to leave. Serious product & engineering concerns that came about (e.g. 73% of devices were turned off after a few months), and I was scrambling to determine how to fix these issues for current + future customers. Simply put, I was trying to figure this out before answers could be given.
3. Acquisition fell through
Earlier this year, we were looking to get terrashroom acquired. Due diligence is a lengthy process & ultimately the options on the table didn’t go through.
I didn’t want to announce anything until the deal was signed & there was a clear path forward for customers. Unfortunately, the acquisitions didn’t pan out as hoped.
4. Health
Not long ago I went to the doctor after frequent heart palpitations & pains. He told me “If you keep going at this rate, you probably won't see your 40th birthday” (I’m 31 now). So I decided to slow down.
5. Burnout
Startups are hard & years of setbacks get to you. You get into some pretty dark places & honestly I just couldn’t shake out of it. I quietly kept working through the problems thinking things would turnaround sooner.
Early days of building terrashroom
What Happens Next
Ultimately, you want to know how this affects you. I want to be completely upfront about our current situation & what this means:
Financial Reality:
-We are not able to issue refunds due to our financial position
-We are in the process of dissolving the company and liquidating assets - proceeds will be disbursed accordingly to customers first
What you can do:
1. File a claim
I've created a customer claims form here where you can submit your information. We will contact you if/when financial reparations are available.
2. Personal commitment
I believe in doing what’s right & am looking at options to personally correct the situation with customers who didn’t receive their product or are unable to get a refund, even if it takes years. If you’ve been personally affected, please fill out the link above. I am unable to promise anything (lawyers say no) but I personally believe in doing what’s right & correcting this situation.
Product Sunsetting Timeline:
Existing terrashroom devices will be sunsetted over the next 30 days as we can no longer maintain the IoT service. If you have existing grows, please look into alternative grow arrangements immediately.
A Personal Apology
I'm deeply sorry we couldn't deliver on our original promise. You trusted us with your money and your enthusiasm for growing mushrooms; while we did everything to bring this to life, we fell short.
Moving Forward
While terrashroom's chapter is ending, I hope the broader vision of making mushroom cultivation accessible continues to inspire others. The technology we developed, the lessons we learned, and the community we built weren't for nothing.
For those who received and enjoyed your terrashroom, I hope it brought some joy. For those still waiting, I'm figuring this out to make things right in whatever way I can.
If you have questions, concerns, or just want to share your thoughts, I’ve opened up Weekly Q&A Sessions on my calendar. Additionally, I'll be reading and responding to every message personally.
Thank you for being part of this journey, even though it didn't end as we all hoped.
Thanks,
Jared