Everyone that backed them is screwed.
In 2016, you might have, if you were unlucky, happened across a Kickstarter for Ossic 3D Headphones. And if you were really unlucky, you might have thrown some money at the project. And why wouldn’t you? The VR market that the headphones were made for is suddenly burgeoning!
Flash forward to today, however, and you’ve got egg on your face. Because despite having over 20,000 pre-orders and a Kickstater campaign that was successful to the tune of $2.7 million (and $3.2 million on Indiegogo), Ossic has closed up shop. And only a sliver of backers ever got their headphones.
Red flags, and the display thereof.
Ossic, for what it’s worth, blames the whole thing on the slow adoption of VR and their unrealistic stretch goals. The latter of which mired their R&D team. Ossic posted the following on their site:
The OSSIC X was an ambitious and expensive product to develop. With funds from the crowdfunding campaign, along with angel investment, we were able to develop the product and ship the initial units. However, the product still requires significantly more capital to ramp to full mass production, and the company is out of money.
Over the last 18 months, we have explored a myriad of financing options, but given VR’s slow start and a number of high profile hardware startup failures, we have been unable to secure the investment required to proceed.
This was obviously not our desired outcome. The team worked exceptionally hard and created a production-ready product that is a technological and performance breakthrough. To fail at the 5 yard-line is a tragedy. We are extremely sorry that we cannot deliver your product and want you to know that the team has done everything possible including investing our own savings and working without salary to exhaust all possibilities.
The OSSIC X was started as a campaign to create immersive and interactive audio. One of the biggest questions was, in a world of small earbuds and phone speakers, do people really care about good audio? Are they truly interested in the next generation of 3D audio? The success of the campaign was a resounding “YES” that has had a ripple in the audio industry.
We will forever be grateful to you and the team members, investors, and business partners who believed in us and helped give our dream a fighting chance. We were able to achieve some amazing things in an industry that was, and still is, ripe for innovation. Your voice of support throughout these past 2 years will continue to bring change to the industry, as bigger players than us refocus their efforts into better, smarter, and more immersive audio.
Thank you for all of your support, and we sincerely apologize that we could not deliver all of the headphones.
Your money is gone.
This January, Ossic shipped the first units to 80 of their backers, those in the $999 Developer tier. In the same update they announced that shipping, they also announced that they’d be entering mass production in the Spring. You can probably guess that that didn’t happen. After all the pre-orders and money, Ossic only ever produced 250 units. And only about 80 of those went to backers.
Now, crowdfunding for tech is a dicey business, overall. The campaigns tend to implode at some point. And in this case, I’d guess that they overpromised; writing checks they can’t possibly cash, so to speak, with their stretch goals. Which means that there’s likely no money for them to refund, should anyone actually want one. They spent far more in development than they should’ve, when sticking to the original goal would’ve been wise. In their response linked above, they state that to move to production, they’d still need another $2 million that they simply can’t raise.
That doesn’t mean that their supporters are going to take it lying down, though. A group roughly 1,700 strong on Facebook are currently threatening to drop a class action lawsuit on Ossic. I honestly couldn’t say whether or not that’s realistic.
Source: TechCrunch
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