< work in process >
In the past year a lot of information has been gathered and uncovered. It would be simply too much to present to you, therefore a comprehensive overview can be found below to give you a general view. If you're interested in detailed information just keep on reading the next sections.
In 2017 the San Diego based Comhear Inc.
presented the themselves as being a start up company. As such they have launched crowdfunding campaigns to raise money for what was then presented to be an innovating consumer binaural 3D audio soundbar called YARRA 3DX. We're here to summarize the events and presenting facts in a way all backers are able to comprehensively read the full story and have justice take its course as we believe consumer and investor's rights have being violated by misrepresentation of the facts and intentionally misleading the backer communities.
Prior to the Kickstarter launch Comhear had already developed a product called ProAV (also known as MBPro-12) as a basis for the Yarra 3DX soundbar; a nearly completed (derived) product, to which only a few components had to be added and slightly redesigned, with a lot of preexisting knowledge to build the production version of Yarra 3DX. As stated later on the campaign website it would require only marginal feature additions and a new industrial design, which had even already been finalized
by Tandem Design
Zylux, Comhear's manufacturer came on board before the Kickstarter campaign had started, as it appeared they were already Comhear (OEM)manufacturer for B2B. In addition to the initial USD$ 8.7M
investment in the company, mid 2017 Zylux made another investment of USD$ 12M
by Zylux Acoustics, a stake of nearly USD$ 20M makes Zylux the main investor.
With Zylux represented on the board, Mr. Gerry Chastelet was appointed CEO and Mr. Andrew Arno named Chairman. Former CEO was put 'in charge' of business development. To potential backers of the upcoming Kickstarter campaign it seemed that the original Yarra 3DX 'team' was not affected, the investment contributed to the feeling this company was well prepared to live up to its promises.
Prior to launching the campaign Kickstarter organization’s dedicated Tech team has given their approval for starting the campaign, they even marked it “Project we love” upon launch.
Comhear first launched a successful Kickstarter campaign on 12-09-2017 (ended 27-10-2017) and continued raising extra money through Indiegogo days after by setting up a pre-order campaign. The company successfully raised a total of USD $1,112,111 , smashing the initial goal of USD $50,000 by nearly 1500%! Funded by 2,679 individuals of the crowdfunding community, this exceeded the initial goal for ramping up mass production and fulfilment of the backer rewards, scheduled for March 2018.
In the course of the campaign the backer community was shown a pre-production version
of the YARRA 3DX immersive soundbar as a proof of concept. According to the very few that have actually been able to auditioning The YARRA 3DX
the soundbar is a very promising product. With all assurances, endorsements by the audio world’s finest and press feedback, the backers at that time did not have any indication Comhear could or would not deliver on their promise.
Main reasons for non-delivery of rewards
We know Yarra 3DX soundbars have been manufactured, several photos of the process have been made available.
Manufacturing is prepared
, components have been manufactured and registered
at the FCCID. Pre-production unit has been delivered and the community was invited
and presented an unboxing video
The manufacturer has halted the production and shipment awaiting unpaid invoices by Comhear, which should have been paid with the backers' money.....
....if it wasn't for Mr. Gerry Chastelet, who had been put in the saddle as the new CEO, clearly taken over from the forward thinking the former C-suite, passionate people who - along with consultants Mr. Peter Otto and Mr. Mark Waldrep - had been responsible for conceiving the Yarra 3DX consumer based soundbar - . They had to make space for Mr. Chastelet's vision and way of doing business, not disturbed by any form of self-enrichment or self-dealing policies.
We have every reason to believe the collected money from Kickstarter and IndieGogo backers have been used as a ‘temporary’ way to finance the business-to-business process (B2B) and basic finance operations (including fees). Whilst searching for new customers - proving this was an ongoing concern as opposed to being a startup -, the company ran out of cash. According to the latest annual report and publicly announced B2B deals there were only a few customers. Comhear must have thought the crowdfunding route could be the easiest way to raise money.
At the risk of not being able to materialize potential deals, the Kickstarter funds aka our money had been used to gamble of preserving and expanding the B2B market, to then simply dry up, resourced evaporated until the last drop. Comhear already being short of money to finance their ONGOING
business in the B2B market it is safe to say the crowdfunding cash has not only been allocated to pay for fees, rent but also to fill gaps. Relentlessly targeting the big boys in the B2B market (+costs involved to get to a final transaction), in their believe a big hit could secure their already fragile financial position, going south on one of those contracts could be catastrophic. There weren't any cash funds left.
We know that 'the working environment became very toxic'. Employees left after Mr. Chastelet took leadership. There are several statements that besides the people that were 'unloaded' as part of the Zylux investment deal (getting Mr. Chastelet at the wheel). Mr. Chastelet could have pushed the start button when the Kickstarter campaign had ended. IndieGogo backers provided the extra cash. All things were in place, but employees were leaving the company, however that had nothing to do with manufacturing process (especially not the Yarra) because Comhear was able to fulfill B2B orders (see ‘Companies’ involved’) and set up a B2B deal with Stampede Global distributor.
Despite our requests for paying back the crowdfunding money none of the backers received a refund. There wasn’t any money to make refunds….we have been a very convenient piggybank for Comhear, completely smashed to pieces and still Mr. Chastelet had the nerves to state in the newspaper
that the raised money (being 1500% of funding goal) was insufficient and needed an extra $4-5 million just to keep the business going, no promises on delivering our Yarra 3DX soundbars. Arguments used by Mr. Chastelet for non-delivery were invalid (see below for details). Comhear has displayed a total and utterly lack of respect to our community and therefore we have lost every confidence - especially in the CEO -, to the current C-suite (delivering/refunding) the backer community is just an afterthought.
Comhear Inc. history – need to knows
According to Comhear statements at the launch of the campaign again Comhear Inc. presented themselves to be a start up company – the truth being far from it – and thousands of backers were presented a fully working prototype based on the Pro AV series already selling to the B2B2C market.
Comhear Inc., formerly known as Taida Corporation
was founded by CEO of Jabra (Randy Granovetter) has been trying to raise funds on a continous basis.
Zylux Acoustic Corp.
is a big Taiwan based company, also Comhear's main investor and board member represented by Mr. Wyatt Briant[/url]. Zylux is the appointed ODM manufacturer for Comhear Yarra 3DX units. Coincidently (..) the company happens to reside at the same address
as Taida Corporation.
Zylux should be capable and solvable to produce the Yarra 3DX units we’re all waiting for. Why did Comhear go the Kickstarter crowdfunding route when Zylux already boosted the company financially?
On the campaign page and in press releases Comhear insinuated that they have the patent ownership on the technology for the Yarra 3DX. As it seems they have been granted a license
for that technology. The license will expire in February 2019 if the underlying conditions will not be met by then. For the Yarra 3DX the company only has the ownership of the trademarks
, not of the patent(s) for the technology.
Since the new CEO was appointed many key persons have left the company. The new CEO then shamelessly appointed well willing people like his own inexperienced son - who he even has to graduate – and friends like Mr. Chuck Labitan.
< work in process >
Position Dr. Mark Waldrep
There have been no recent updates by Comhear representatives, all recent campaign updates have been by Mark Waldrep, a consultant with no direct affiliation with the company. Mr. Waldrep’s actions and statements are credible because routinely interacted directly with current and former management as the consultant Comhear Inc. hired to run the Kickstarter campaign. Marks efforts to try and keep the community up to date, applauded by the community, are limited due to an NDA he signed.
Comhear's CEO has rejected Dr. Mark Waldrep’s offer to take over the Yarra 3DX, the best solution for Comhear to take this burdon of Comhear shoulders and their chance to walk away from this mess we hold them responsible and accountable for.
Mark Waldrep stated in his blog (http://www.realhd-audio.com/?p=6311
a) “The funds raised through the campaign were sufficient to pay for the tooling, development, parts, and manufacturing of 2700 units. Unfortunately, the company spent the money on normal company operations and do not have the resources to complete the remaining tasks — including manufacturing and shipping”.
b) “The company is trying to raise additional funds to complete the manufacturing of the YARRA 3DX. As a result, there is no ship date. And there is a very real chance that the company fails to deliver the promised YARRA 3DX sound bars at all.”
Dr. Mark Waldrep stated in his farewell post
from February 12 2019 administrative control has changed hands, he is no longer attached to Comhear Inc.
Based on the above one can reasonably conclude the reason we don’t have our YARRA 3DX sound bars is because Comhear Inc. misappropriated Kickstarter and Indiegogo backer funds to pay for it’s money losing ProAV business.
The backer community have no assurance our Yarra 3DX will (ever) be manufactured and delivered, no transparency with Comhear’s operations over the past several months either. Also, we have yet to read a statement from Mr. Chastelet that gives us any actual information on business dealings during the mass silence.
Comhear's ODM/OEM manufacturer Zylux Acoustics (represented on Comhear board and being main investor) obviously wasn't willing to grant Comhear the additional money Comhear has been seeking for. They already had to shut all Yarra 3DX operations down as seemingly the costs for that had not been paid either.
The company presented fraudulent information in order to secure our backing. Over the last year they have made several dishonest statements in updates.
All we have now are hollow reassurances that do not ease backer unrest. It’s the secretive attitude that is rubbing folks the wrong way. Comhear clearly is not bothered nor affected by self enrichments and self-dealing at the cost of Comhear reputation, their employees and potentially great product release of the Yarra 3DX.
We want to see documentation
and meeting minutes that show what’s been discussed and planned in regards to the Yarra production. This includes evidence of due diligence and breakdown of where the money went, which was said to be spent on manufacturing and prototyping since the campaign began. After that, the detailed plans to get Yarra production complete and into backers hands or immediate refunding of pledged+shipping fee collected.
Allegations & conclusions
The key allegation is Comhear misappropriated backer funds to pay for non-YARRA 3DX expenses, ie ProAV company operations, rent, moving HQ to LaJolla, fees, PR, marketing and sales cost budgets spent on existing (B2B) PROAV company operations, costs involved for Stampede deal, shows and events (flights, hotels, for the Comhear team, etc) instead of manufacturing the sound bars backer funds were explicitly raised to produce. Failure to ship YARRA 3DX is breach of contract.
If documented, misappropriation of backer funds would be fraud. So far Comhear has ignored repeated requests to provide a full accounting of how backer funds were spent.
A summary of allegations:
For detailed information and backgrounds please see <<HERE >>
Kickstarter has made a statement on Februari 4th 2019
......awaiting Kickstarter reply to the response sent out 02-06-2019, mostly based on the general tone of voice ofcomments from the backers
(and scrolling up)
Knowing what has happened to date, given the contradicting statements on the campaign website - misleading to say the least - and other matters that have been uncovered, it is very hard to believe Comhear intends to deliver the Yarra. Not mentioning anything of the above, hence the ‘gap in communications’, the backer community can not and may never understand the Comhear board was unable to make any definitive statements and serious issue remain in keeping patient and understanding.
Even if Comhear will ever resume production of the Yarra 3DX it will be done with minimum effort and minimum quality assurance, just to fulfill what was promised. Nobody now stand behind this product and nobody will protect backers interest in this company.
Increasing evidence is coming to light that crowd funding money have been misappropriated and used for purposes other than those stated in the campaign. The tenuous financial position of the company was not disclosed to backers.
The backer community is taking actions
and is working on finding ways to increase the awareness of this process, including ways for exposure and demands
The community will continue and persist in their effort to conduct thorough research, filing relevant information/evidence of malpractice/misrepresentation/withholding of facts, be conducted by highly regarded tech and equity reporter journalists
, as well as appropriate investigation by market watch dogs
. Backers will continue filing complaints
of violations by Comhear, take appropriate legal actions, planning and take actions
we feel necessary to bringing Comhear Inc. way of doing business to the attention of the public and authorities.
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