A Hachette rep offered the following statement on the issue:
Today, we had to make some difficult changes at HBG [Hachette Book Group] as part of a cost-savings initiative that will improve our company’s resilience to a changing marketplace and position HBG for future growth. Unfortunately, these changes mean that some of our colleagues will be leaving the company. These efforts will improve efficiency and balance throughout HBG. This is essential to our company’s continued growth, and our ability to carry out our primary goal: to publish our authors’ work with passion, originality, and impact. Read more…
Ten days ago, I reported various red flags around Moscow-based Healbe and its Indiegogo campaign to build a “GoBe activity tracker.”
The device is like a Fitbit with superpowers, able to automatically track the number of calories a user has consumed by monitoring glucose levels via a wrist sensor. Such a device would be the holy grail for health freaks and diabetics alike and it generated immediate interest, collecting $ 730,000 in three weeks.
Since this first article was published, Healbe has raised another $ 140,000 to take its tally close to $ 880,000 and could well cross $ 1 million before the campaign ends on April 15.
Unfortunately, as the Indiegogo haul increases, so too does evidence that the device can’t possibly do what the company claims, and that it might not even be able to ship at all.
As our investigation has continued, more experts are speaking out about the snake oil science behind the Healbe, with one doctor telling us the company’s claims amounted to “bullshit.” For 18 days, Healbe has teased the release of internal research that it claims proves the science behind the GoBe, but that proof has not been delivered. A spokesperson for the FTC confirmed that, based on the scientific proof offered by the company so far, the Healbe would not be allowed to advertise via traditional media.
This is all in addition to the earlier red flags we reported: the company claims to be based in San Francisco but is in fact operated from Moscow. Its American operation amounts to a lawyer, a dummy corporation and a PR-office in New Hampshire. It also claimed a grand CES unveiling which was later “clarified” as being a guest in someone else’s booth alongside 16 other companies. CEO Artem Shipitsyn’s Indiegogo biography differs markedly with his LinkedIn page, none of his team is traceable to anything but this one Indiegogo campaign and most importantly, medical experts claim that there is no possible way the GoBe can do what it claims.
Through all of this, Indiegogo has insisted that the company passed all of its fraud checks, although it wouldn’t tell us what those checks involved, or whether they had sought independent advice on the device’s medical claims.
Since last writing about the GoBe, Pando’s investigation has focused on the medical claims behind the device. Ten days ago, when we spoke via Skype, Shipitsyn explained the device’s science to me as follows: when you eat sugar, the insulin causes your cells to open up and release water, which Healbe measures through the GoBe’s impedance monitor – a device that can track fluid levels – and allows Healbe to calculate your glucose level.
“That’s some straight Ghostbusters, Peter Venkman bullshit,” says Zubin Damania, a Stanford-educated, Las Vegas-based doctor.
In fact, all of the experts we spoke to agreed that an impedance monitor has no way of making any meaningful correlation between the level of fluid in our body and glucose levels. There also appears to be no medical literature showing anybody having tried to make Healbe’s link between fluid in our cells and glucose.
Even if true, the technological breakthroughs claimed by Healbe couldn’t “just magically come up out of thin air,” says Ries Robinson, the CEO of Medici Technologies, who has a Masters in mechanical engineering from Stanford and a degree in medicine from the University of New Mexico.
Robinson compares it to the “sudden” appearance of Tiger Woods. To many it seemed like Tiger Woods broke instantly into superstardom in the late-1990s, but when people read behind the headlines they see that Woods was phenomenal back when he was five years old. Healbe’s GoBe device would be a medical revelation but, Robinson says, they would have to be improving upon a trail of other advancements that would be quickly evident and demonstrable. The people involved in the company would have storied scientific backgrounds traceable to more than one Indiegogo campaign and would be able to spin off a litany of research about why this could be done.
“If you’re a legitimate company, you’re aware of the research,” Robinson says.
Both Robinson and Damania conclude separately and strongly that even if Healbe could do this first part, measuring glucose in our cells through the skin, there’s no way to take that glucose reading and deduce caloric intake.
And yet, Healbe insists that it has designed an algorithm that can do precisely that. Which to those spoken with, was laughable. “There is no possible way that glucose has any correlation to calories,” Damania says. The body modulates glucose levels well, except in diabetics, and there’s no relationship between the glucose present in your cells and in your blood and what you’ve eaten.
“That algorithm would have to written by an omniscient deity, different for every individual and different every day as that person’s metabolism and ratio of fat, protein, alcohol, carbohydrate changes in their diet daily,” Damania adds.
Robinson says that when we ingest glucose, some goes to the bloodstream, some to our liver and some to our cells, which renders the relationship between calories and glucose moot.
I tell him that Healbe is claiming only around 90 percent accuracy with its glucose-calorie estimation. “Even if you simplified your diet down to just eating pure sugar, I don’t think it would be anywhere close to that accurate,” Robinson says.
Healbe have been sluggish in defending its product, slow to release proof that it swears that it has that will clear its name.
Shipitsyn told me that the company had patents and investors, but Pando has been unable to find any US patents relating to Healbe or GoBe, or any patents at all owned by Shipitsyn. A Crunchbase page for the company lists a $ 600,000 “venture round” from this month, which links only to an article from a European blog about the company crossing the $ 600,000 mark on Indiegogo — not a campaign that has closed and certainly not an equity investment. (We’ve asked Crunchbase to clarify what constitutes a “venture round” and will update with their response.)
We asked Healbe’s PR company and American representatives – MicroArts Creative Agency – for clarification on Healbe’s claimed patents and rumored investors. MicroArts’ Meghan Donovan responded with a statement that: “Healbe has conducted internal testing on GoBe and is in the process of securing third-party testing to officially validate the product’s claims and accuracy. We will be posting more information on our patents and investors in the future.” The company would be adding in an FAQ to more specifically describe how it automatically tracked calories on Friday, she added.
For his part, Shipitsyn has been sporadically active on Indiegogo responding to commenters, hinting at an imminent release of internal research to quieten the concerns of his backers and the chorus of outrage from the medical community. The problem remains, that for three weeks the release of this information has remained just around the corner, but so far completely out of sight.
On March 13, with the account already over $ 500,000, comments first started to appear pushing Healbe to clarify its science. Shipitsyn responded that the company only had in-house data, but that closer to June – when the device would be supposedly shipping – it would publish independent results to validate its claims.
On Tuesday March 18, Shipitsyn said that the company would publish its internal tests, that week. But the next day confirmed only that it would publish its tests at the “closest time.”
On March 20, responding to PandoDaily’s initial story, Shipitsyn responded only that it was “funny” to read this “detective&spy” story. Still, he didn’t give a date for the release of the company’s internal testing results, let alone any external, independent testing.
On March 22 and 23, Shipitsyn made two more comments. “We see that our customers do not have enough information,” he said on March 22. The next day he said again that Healbe was working on its internal tests.
Shipitsyn disappeared for a week, with none of the promised information coming in his absence. Yesterday, he was back on line. “We’re working on new scientific content,” he said. It would be published next week.
He signed the message off with a dash of frustration. “If everyone knew how to do, what we offer — it would have been done a long time ago. If somebody think, he/she know everything… This is not our issue :)”
This morning Shipitsyn was back on the site, saying to expect internal tests this week, but that the release depends on its marketing team. It said that it had recorded a video with a TV channel, but that won’t be available until “near” April 15, coincidentally, the day the campaign closes and the money is released to Healbe.
With 15 days left to fundraise, and Indiegogo insisting they have no reason to pull the campaign, it’s a good bet that Healbe will take home more than $ 1 million from its campaign. A spokesperson for Indiegogo told Pando in a statement: “We have customer-driven, algorithmic and operational processes that make Indiegogo a trusted platform worldwide.”
It goes even further on its website. “Indiegogo has a comprehensive fraud-prevention system to protect our users. All campaigns and contributions go through a fraud review, which allows us to catch any and all cases of fraud,” read its help pages, updated one week ago.
“All” is a remarkably strong word. Kickstarter, for instance, doesn’t make that claim, even though it has a much higher bar to allow a project to list. In fact, Kickstarter’s accountability page reads like a direct warning against supporting companies like Healbe. “Creators are encouraged to share links and as much background information as possible so backers can make informed decisions about the projects they support.” Kickstarter also doesn’t allow campaigns to package product as rewards, while Healbe’s campaign page allows backers to pay in advance to receive up to ten the of the devices. (Kickstarter was contacted for this story but declined to comment.)
Indiegogo’s no gatekeeper approach allows such a low bar of proof that Healbe is able to make claims on the site that wouldn’t even pass muster in an infomercial. A spokesperson for the FTC said they did not comment on specific companies but confirmed in general terms that, given the levels of proof displayed, the type of claims made by Healbe would not be allowed in traditional advertising.
Accord to Healbe’s campaign page: “GoBe precisely calculates calorie intake, burn, and metabolic rate during any activity, with no logging, tracking, or guesswork.” According to the FTC, such “express” claims – literally made – must be supported by objective evidence in an advertisement. Healbe, as such, has only a photo of its device and its own word to back it up.
Healbe says it will ship in June, but has been vague about how far down the production process it is. According to prominent hardware experts, all who asked not be identified by name, it’s highly unlikely that a hardware company still crowdfunding deep into April would be able to deliver a finished product in this time.
If Healbe doesn’t ship, or its product ships and doesn’t work, Indiegogo will hope to shrug this off as one of the risks of the beautiful experiment of crowdfunding. If asked it will say something about hardware being hard and that not all campaigns get to market. And of course it will pocket its 4% share of the pot.
With almost a million dollars of users’ money at stake, no crowdfunding platform should be able to play fast and loose like this. Healbe claims its device can do things that doctors and scientists insist it cannot. It hasn’t offered a lick of proof, beyond pictures of prototypes and has constantly changed its story about when scientific evidence will be released. Indiegogo is about to help facilitate the transfer of $ 1 million dollars to a vaguely traceable company in Russia, selling a product that cannot possibly work.
“Because of relative gaps in research, nutritional science is one of the last great bastions of pure pseudoscience,” says Dr Zubin Damania. And Indiegogo is the perfect place for scammers and pseudoscientists to ply their trade.
There are a few ways Indiegogo could take a middle ground approach between Kickstarter and a total buyer-beware Wild West. It could, for example, take the approach YouTube took with copyright issues, where it wasn’t going to police every video uploaded but if flagged, it would remove something that broke the law. Indiegogo could adopt a policy of not investigating every campaign but taking a closer look if serious concerns were raised.
Another less-drastic approach might be the Wikipedia one. If someone raises serious questions about a campaign, put a banner across the top that reads something like, “Warning: Questions have been raised about the legitimacy of the claims made here. Invest at your own risk.”
At the time of writing, however, Indiegogo position remains unchanged. The Healbe campaign remains active and almost 3800 people — and counting — have no reason to believe their magical wrist band will deliver on its promise, if it’s delivered at all.