Kickstarter debacle Coolest Cooler shipped none of the 20,000 coolers it owes customers last quarter, according to an update the Portland company sent to crowdfunding backers last week.

And things may get worse. The company said it is facing a 25 percent tariff on any new coolers shipped from its contract manufacturers in China.

"We'll be fighting this of course, but these are the crazy sorts of things that affect this business and our ability to deliver on our goal of getting you your Coolest," the company said in its update.

Coolest Cooler is the second-most popular project in Kickstarter history and one of the crowdfunding site's biggest disasters. In 2014, the company raised more than $13 million from 60,000 backers who sought its tricked-out cooler with a built-in blender, wireless speaker and other gadgets.

But Ryan Grepper, the company founder, lacked experience in manufacturing and supply chain and found the cooler cost more to make and ship than he had raised from backers. Four years later, a third of the company's supporters still don't have their coolers.

Kickstarter is a popular way for craftspeople and artists to raise funds for small-scale projects but has proved ill-suited for commercial projects like Coolest Cooler. Such projects go viral online, attracting immense popularity, then overwhelm the inexperienced people who conceived the ideas.

Backers, meanwhile, are easily confused by Kickstarter's website. It feels much like a standard e-commerce site but in fact makes no guarantees that project backers will receive the items they fund.

The Oregon Department of Justice reached a settlement with Coolest Cooler last year. The deal required Coolest to provide 873 coolers to backers in Oregon, and others who had complained to the state.

Coolest Cooler met that commitment and says it hopes to finance the remaining 20,000 coolers by selling them at retail and with other products, including a new-soft-sided cooler. Its deal with the Department of Justice requires it to pay $20 to all customers who don't have their coolers by mid-2020.

Though the company shipped no coolers to backers last quarter, Coolest Cooler said it continues to hope the sale of other products will help dig it out of its hole – provided the Trump administration's new tariffs of Chinese products don't get in the way.

"Nothing would please us more than to have the cash on hand to ship a boatload of Backer units," the company wrote in its note to backers last week.

Kickstarter continues to feature Coolest Cooler on a list of "Projects We Love."

-- Mike Rogoway | twitter: @rogoway | 503-294-7699