Hardware startups are hard. Specialty audio/loudspeaker startups even harder. Almost all have been forced to prove themselves on the crowdfunding circuit at Kickstarter or Indiegogo. Most of them fail, for all the reasons that physical products fail regardless whether the product is good or bad. Companies simply run out of money during the development stage or underestimate all of the things required to bring a working and reliable product to market.
A few days ago we learned a new speaker startup called Syng has raised a whopping $48.75 million. Earlier this year, Syng released their first product — Syng Cell Alpha — a $1,800 wireless speaker that can be used by itself, but is meant to be used as a trio to deliver a 360-degree spatial audio experience.
Will people pay that much for a speaker? Will they buy three? Who knows. We haven’t heard them yet to give you any insight how they compare to other products.
What we do know is that spatial audio is likely to be the future of audio. If I had any doubts, I don’t anymore after hearing a demo of Sony’s 360 Reality Audio 13.1 speaker system at Sony Pictures Studios.
However, few homeowners have the space for 13 speakers placed in a perfect sphere. Ultimately, Syng is aiming to convince your ears their 3 speaker system will be just as magical as a 13 speaker system.
The catch-22 of spatial audio is that the music needs to be mastered for spatial, or re-mastered with special software. So part of Syng’s bet is they can time the release of their speaker with a spatial audio music revolution.
Things are moving in their direction since Apple announced support for Dolby Atmos (a competing spatial audio format to Sony 360RA) on Apple Music. However, spatial audio music represents less than 0.001% of all the tracks on Apple Music; there’s a long way to go until 75 million tracks are available in spatial audio.
Syng (the company) was co-founded by former Apple lead designer, Christopher Stringer, who spent 22 years at Apple and most of them under the leadership of Steve Jobs. Co-founder, Damon Way, who also co-founded DC Shoes and Incase, seems to bring the marketing chops.
Syng’s A Series funding round was led by Eclipse Ventures. In addition they earned music industry support with an investment from singer Lionel Richie. Instagram and AirBnb co-founders, Mike Krieger and Joe Gebbia, respectively also joined the round. Bridford Group, SIP Global Partners, Renegade Partners, Animal Capital, Schusterman Family Investments, Vince Zampella and Alex Rigopoulos round out the participants.
Wait a second. $48.75 million? Do you know how many high-end audio loudspeakers companies started with $48.75 million in the bank? The answer is probably none.
An unproven startup with a single product achieves a ~$200 Million valuation (estimate based on round size). I’m not sure how the numbers add up. Maybe they don’t. I’d love to chat with any investor to understand what they were thinking. Maybe the company has unique IP I’m unaware of. I’m open-minded.
Congratulations to Christopher and Damon and the Syng team! You have a fighting chance. The $48 million question is whether or not they have the ability to transform the high-end loudspeaker industry in the way Steve Jobs changed the music, smartphone, and computer industries with innovative and groundbreaking products.
It will be interesting to see how they do.
Learn more about Syng Cell Alpha.