There are significant fixed costs in building a smart phone, for example in design, certifications and tooling. Building something like 50K of them is already on the low end.

It would be a disaster for them if they got into a position were they had costs of $1500 per phone and had to choose between bailing out or eat the losses.

Arguably the whole attraction of these things is that there's a model where you pledge an amount and only have to pay up if there's enough money to get it off the ground.

No one wants to be the guy who stuck $700 down for something that will never exist because they were the only ones to pledge.

If it weren't for the fixed model, they would struggle to get even a fraction of the money they've raised so far.