3D Headphone Startup 'Ossic' Closes Abruptly, Leaving Crowdfunders Hanging (npr.org) 168
An anonymous reader quotes a report from NPR: Ossic raised more than $3.2 million in crowdfunding for its Ossic X, which it touted as the "first 3D audio headphones calibrated to you." But after delivering devices to only about 80 investors who'd paid at least $999 to for the "Developer/Innovator" rewards level on Kickstarter, Ossic announced Saturday it had run out of money -- leaving the more than 10,000 other backers with nothing but lighter wallets.
Ossic, which The San Diego Union-Tribune notes was founded by former Logitech engineers Jason Riggs and Joy Lyons, had excited gamers, audiophiles and other sound consumers by creating headphones that used advanced 3D audio algorithms, head-tracking technology and individual anatomy calibration to "deliver incredibly accurate 3D sound to your ears," according to its funding campaign on Kickstarter. In less than two months in 2016, it was able to raise $2.7 million from more than 10,000 backers on Kickstarter. It raised another $515,970 on Indiegogo. "This was obviously not our desired outcome," the company said in a statement. "To fail at the five-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."
Ossic, which The San Diego Union-Tribune notes was founded by former Logitech engineers Jason Riggs and Joy Lyons, had excited gamers, audiophiles and other sound consumers by creating headphones that used advanced 3D audio algorithms, head-tracking technology and individual anatomy calibration to "deliver incredibly accurate 3D sound to your ears," according to its funding campaign on Kickstarter. In less than two months in 2016, it was able to raise $2.7 million from more than 10,000 backers on Kickstarter. It raised another $515,970 on Indiegogo. "This was obviously not our desired outcome," the company said in a statement. "To fail at the five-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."
Fair enough, let others pick it up... (Score:2, Funny)
I presume they'll be releasing into the public domain all their research notes, designs, prototypes, etc?
Re:Fair enough, let others pick it up... (Score:5, Funny)
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why would they return the money?
Investment is a risk, not a guarantee.
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Buying (hoping to buy?) a pair of headphones through a crowd-funding site is hardly an investment, unless you believe your headphones will become some kind of family heirloom.
Re:Fair enough, let others pick it up... (Score:5, Insightful)
Buying (hoping to buy?) a pair of headphones through a crowd-funding site is hardly an investment...
And that's the problem with crowd funding: People don't understand what they are doing and think they are just pre-ordering a product. You are not buying headphones, you are providing capital to a company to make headphones, and as a thank you, they will send you a pair when they are done. It's a micro-investment but since they are not allowed to reward you with ownership due to government rules (like a regular investor would be), they reward you with a product. People need to understand there is always a risk the company won't make it and they will be out their investment with little recourse.
Re:Fair enough, let others pick it up... (Score:4, Informative)
Interestingly, in the UK that may not be true. The Spectrum Vega+ on IndieGogo is currently in the middle of collapsing but they've already been sued and the court found that the presence of an expected delivery date among other things meant that it WAS a pre-order legally.
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What redress is there though? They get sued, lose and all the money has been spent on bonuses and legal fees... And of course all the other creditors are lined up for their share too.
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The whole thing is bordering on hilarity.
They claimed they were ready to ship 2 weeks ago but haven't released a single picture of a finished device, so presumably they don't exist.
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Well, they are a creditor to the bankruptcy, but that's probably going to get them pennies on the dollar.
No, it is NOT an 'Investment' (Score:2)
ROTFL.
So, its an investment is it?
Great! Where is the documentation showing that these 'investors' now own part of the company? If enough of them get together they can control it!
Pity it was not a success, then they could all claim a share of profits!
Oh, wait, there is none, as it is an unsecured pre-order. At best. Oops.
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Except if there's actually a sale (even pre-sale money exchange) then there's a chance of getting a refund.
Go ahead and try to get a refund for this, or any number of other kickstarter failures. I won't hold my breath. There's a reason why the product you get back is always referred to as a "reward" or "gift" - so there's no language anywhere that can be referred to by people wanting their money back post-failure.
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To be more precise, you are helping the manufacturing costs of a product that may or may not get made.
For a good example, look at the PodRide [indiegogo.com]. Interesting idea, but going from a single hand-made prototype to optimizing the parts for manufacturing has cost them a lot more than they thought, both in money and time.
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The reward by its nature is not an investment, though. If you buy something, even something with a relatively long life like a pair of headphones, simply for your own use without generating any kind of return, that is consumption.
You are not buying anything. You are offering funding to the company. The company offers gifts back in exchange for that funding. Crowdfunding sites are not storefronts, and there are extra risks involved because of that. You are literally making my point that people don't understand what they are actually doing when they crowdfund a company like this.
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It's a little bit of this, and a little bit of that, but is neither one or the other.
Crowdfunding has the inherent risk of investments, but the rewards of a sale. As far as legal protection is concerned, it seems to be more under contract law than consumer law, at least going by the legal cases I've seen. Consumer law has only come into it if the project turns out to be fraudulent, and even then, no pledges were refunded.
Seems like you need to approach crowdfunding with an investment frame of mind, and on
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I agree it's a grant of money, but it's not free. There is an effective contract made when you make the pledge. If the development is successful, the producer is legally obliged to pony up the rewards, whether they want to or not.
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Most people seem to stupid to understand that idea. Even many people here seem to be unable to grasp the idea of a risk-investment. Pathetic.
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Says an idiot too dumb to know that Kickstarter is not an investment as there is no equity given or debt issued to backers of a campaign. You’re giving money to a black hole in hopes you’ll get a reward and if it fails they owe you nothing. If this was an actual investment these backers would be able to go after them to recover some portion of their investment as a creditor.
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Did you call moi a dipshit?
Grab this guy.
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Yeah, I’m sure they’ll get right on that...
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Why would they do that?
They may want to try the idea again.
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These guys [wikipedia.org] would like to have a word with you.
Re: Fair enough, let others pick it up... (Score:1)
License? (Score:3)
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And they know full well that that is the case... so... not that stupid. If I back something I know full well I might never receive it, I've backed 2 things so far. Amplitude, which I received, and Star Citizen, which I'm happy to wait for.
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9% failure rate on Kickstarter projects, according to a study done a few years ago.
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Has Star Citizen collapsed yet? I continue to be bewildered by their ability to con money out of yet more idiots.
Re:License? (Score:4, Insightful)
And you are very, very wrong. As in you do not understand the model at all. Sure, some investors are this stupid, but many are not. And many get hit by the offer not materializing rarely enough that the overall thing makes a lot of sense. I have about 10 things I invested in, 1 outstanding, 6 nice results, 2 mediocre results, 1 fail. That is a lot better than would be needed to make my investments very worthwhile.
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I have about 10 things I invested in, 1 outstanding, 6 nice results, 2 mediocre results, 1 fail.
Given crowd-funding current record I would say you are either extremely lucky or extremely low risk taker... like investing on a new high performance napkins or somesuch.
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Neither. I fund things that have a realistic chance of working from the history of the people working on it and the description of the project. In fact, I have funded almost everything I am interested in. The problem is that a) the risk of crows-funding gets vastly overstated in the press and b) it is not hard to spot the ones that have really no chance to deliver c) many people do crowd-funding that do not understand the risk is theirs, obvious as it is. Group c) then complains loudly when reality reminds
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investors
You keep using that word but Kickstarter backers are not investors. Investors have legal rights that Kickstarter users don’t have.
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Nope.
An investor is simply someone who provides capital for something. That's it. Some investors have legal rights, because they invest in regulated markets - stock markets, for example. These are highly regulated and investors have a lot of rights because of abuses done years ago.
But you can invest and lose everything. In fact, most business you see have investors. It c
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For much less money, you could use a real VR headset and any headphones.
Ummm. No. (Score:2)
An investor is someone who provides capital in return for a share of the company.
On Kickstarter you are NOT an investor, unless they are offering shares of the 'company' in return.
You are just an unsecured pre-order client, or donator, depending on what you choose to do.
The most obvious difference is profit share, why on EARTH someone would give captial investment without any form
of profit share agreement in such a case is... special?
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If you buy through Kickstarter or the like, you typically get a discount on the final product. That is one reason why people would do it.
Also the products tend to be quite niche, and if it is something you really want, you might want to take the chance, because if not enough people do at this stage it may never be produced.
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You think of a specific type of investor. The word is far more general than your limited understanding.
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Np. An "investor" is somebody that gives money to something expecting some chance of some return. You seem to have trouble understanding the English language.
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Investor? You keep using that word...
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If I get something that I want and would not have gotten otherwise and I get it at a much lower price, I am stupid? I think you are confused as to what "stupid" means.
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That's literally what investing is.
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Except for lacking all the legal rights of an investor?
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Why is it stupid? Sometimes people need something that they cannot make themselves yet will never be made by any company because the demand is so low it would not even register as noise on their sheets.
The Link [kickstarter.com] is such a product which got made and the quality is as perfect as it could be. People took the chance because there was no alternatives.
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To be fair, that's pretty much what we're doing whenever we give money to projects like OpenBSD or to advocacy groups like EFF. Giving free money in the hopes that you might get something back isn't stupid as long as you remember "give" is a major key word here, and "in the hopes" is as light and unbinding as it appears. As long as you really understand you might get nothin', it ain't stupid.
Sometimes you just wanna throw money at someone who you think is doing the right thing, so that they can keep on kick
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From the article: The reason it'd not interest a bigger company is due to the amount of support needed to get it to work.
After all the hardware, you still need a special driver for every system you're planning on supporting, plus an API for the developers of games, etc. to use for talking to your system.
They probably vastly underestimated the amount of software development needed to keep the system working, or overestimated the skill/amount of development time game developers would be willing to put towards
That is how crowdfunding works (Score:2)
Deal with it. You invest a certain amount of money, there may be a pay-off in the form of a product that would otherwise not have existed, but there may also not be a pay-off. Stop complaining.
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Deal with it. You give away a certain amount of money, there may be a pay-off in the form of a product that would otherwise not have existed, but there may also not be a pay-off. Stop complaining.
FTFY
Invest has connotations of being more rigorous than what I see of most crowdfunding
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In which case you can just wait and buy the product once it's actually available.
This is news? (Score:3, Insightful)
Great company, doomed to fail (Score:5, Interesting)
Weirdly enough, I know these founders. They were great people, hard workers, and smart. I got to mess with the prototype a bit and it was pretty incredible; as acoustic engineers they were amazing people.
But I never shook the feeling that it wasn't going to work. Where did it go wrong?
1) Ossic got the tech working, but that's not enough to build a successful business. It needs the right product-market fit. The problem I had with their business was it was predicated on the hypothesis that VR would take off creating a market for them to fill. It has not, and their business floundered. Even if it did take off, a game developer would have to build their audio portion of the game around what their system offered for it to provide the full experience, so it was also predicated on developers designing for their headset. THEN people would buy it. That's a tough sell. When VR floundered, they tried to re-position the tech, but it didn't have a good application outside of VR gaming.
2) Design costs - product engineering always costs more than you think. Always, and if you're not experienced developing hardware it's often 5X what you expect it to be. THis is the hard part with crowd funding: people budget assuming the gross margin on the hardware at scale, but it's the ramp to gross margin (engineering, prototypes, re-engineering, test lots, first batches, then the working capital cost to develop inventory to deliver at scale) that hardware projects die. Ossic's folk are actually quite experienced at product design, but it's in the operational and budgetary side that can be difficult.
I like these guys, they did the best job they could and did make an interesting tech. It's sad to see folks with such passion and heart go down.
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So they made a proprietary audio format, backed by a startup nobody has ever heard of, and it only works with this set of non-existent headphones.
I just can't imagine where they went wrong. Especially considering the failure of every 3D spatial audio proprietary garbage that came before in the last 18 years. Unless your name is Dolby or Sony, good luck ever getting anyone to support it.
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The money has most likely been spent. It sounds like these guys were honest and really tried to make the business work. If they could have gotten to this point without actually needing the money, they probably wouldn't have bothered with the campaign. Scammers do the opposite. They don't even try to build something. They just take your money and run. Honest businesses fail all the time and someone gets burned when that happens. It is the same set of people who would have made a bundle if it had been a succe
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I’m guessing they were using an ambisonic sort of config so you could get actual spatial audio in three dimensions.
I messed with some of this back in 2015 during the be phase and it was pretty amazing but we were just throwing a shit ton of pcm audio at an algorithm to do the spatial HRTF (head related transfer function) and position the separate mono sounds in 3D space. It truly sounds amazing and made our VR demo so much more believable.
Dolby 7.1 can’t touch this with a ten foot pole.
There is
Well at least (Score:1)
3d audio is old hat (Score:2)
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back in the 90's. This is not new tech at all
Except this is nothing like theatre in the 90s and has far more in common with Dolby Atmos (theatre in 2013) than with your example.
But don't let not understanding what it does or how it works get in the way of your criticism.
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This is not your typical HRTF.
They were doing positional mixing inside the headphone, incorporating sensor data from a VR headset to allow for low-latency sound translation. Current VR mixes sound in software, which means for quick head movements, the sound can lag behind noticeably.
The headphones also had more than one driver per ear, with a custom HRTF to take advantage of them.
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If your computer can render for VR, it can _certainly_ handle the audiopipe.
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I never said it was being done in the correct place, but you'd actually be surprised how difficult it actually is to do low-latency audio rendering in software.
When you render VR, the frame can take several milliseconds to render. It then, at the last moment before going to screen, performs a screen-space transform to account for any head rotation that happened in that short moment of rendering. So they have a way to hide the latency. There's no equivalent transform that can be done with audio, so you're st
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There is no equivalent transform _necessary_ for audio. Close enough is close enough.
Even if you're in the middle of snapping your head around during those few milliseconds (call it 11, 1/90th second, one Oculus display frame), I don't think you could turn you physical head more than 5 degrees in a 90th of second (I doubt you can turn your head that fast, not comfortably. Likely throw the headset across the room).
5 degree direction change isn't going to change the sounds noticeably. If you're being vir
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So, now tell me.
WHY would you do 3d positional audio mixing in the headphone?
HOW do you get the 3d positional information to the headphone?
Thats the main fail: There is absolutly no problem here to solve: all of this is much better done in the VR system, and they do.
Money well spent (Score:2)
I didn't back this, but I have to say I couldn't be too mad about this folding, as it was a reach to begin with - you don't back moon shots expecting every one to fly. You just back the ones you want to see try and enjoy whatever success you find.
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This is what passes for news nowadays (Score:2)
Yep, I'm trying to keep the bitching on articles down to minimum, but how does this even pass for news? And I'm saying that because major news sources broke the story long before SlashDot, so apparently it IS news. Out of seven reasonable, reachable-goals Kickstarters (Which is supposed to be the verified, trustable projects) I've participated in, ONE delivered what they promised, after one delivered my "Beta Tester Ultimate Package" in a broken state after the product was already being delivered at lower p
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Two idiots that do not get it in a row. Special, even for /.
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And that his post isn't even worthy to insult.
Re:Ha! Ha! (Score:5, Insightful)
Yea! Lets laugh at people who lost money! It doesn't do anything to make our lives better. We are short of a new product that a lot of people may had wanted, some people are out money, who probably could had invested it into an other product that could had come to be.
The issue I have with Crowdfunding is that it is a High Risk Low Reward investment, But it is relatively cheap to get into. So often the money people put into crowd funding is the old equivalent of smoking money. Money people can afford to loose.
However the idea of the product and the credentials of the people, made it seem plausible. However 90% of all businesses fail within the first year. We should know this. That is why there is Bankruptcy protection laws. Because it is to allow people to fail, without having to lose everything.
However, I would much rather see success in such ventures. As I would have a new gizmo that I may want to have, and if the product goes, the company will expand and hire more people to work for it. An overall net benefit.
But screw all this Nerd Economics stuff. Lets laugh at someone misfortune, because they didn't make the best business decision.
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Yea! Lets laugh at people who lost money! It doesn't do anything to make our lives better. .
Okay.
HAHAHAHAHAHAHA
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Yea! Lets laugh at people who lost money!
Looks like we found one of the suckers who backed this campaign. Hahahahahahahaha!
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So much butthurt. Do I need to call the waaaahmbulance for you?
Re: Ha! Ha! (Score:3)
Crowdfunding is like an ICO. It's a way to avoid the critical eye of sane financial investors, and instead attempts to get funding from the least qualified people.
Imagine if Sennheiser started selling claims to future headphones they haven't yet developed. Consumers would rightly laugh at them. A company is expected to figure the financials to deliver a product. If they can't do that without crowdfunding, it's a strong sign the idea is shit, and they can't get traditional funding.
People are dumb and deserve
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Crowdfunding is like an ICO. It's a way to avoid the critical eye of sane financial investors, and instead attempts to get funding from the least qualified people.
No it isn't. That's perhaps true for some but for others it's so far away it would hard to be further away and still be about money. For some, it's basically a form of patronage. For others it's for a product that would never get invstment because there isn't a big enough market to make it worth investing. For others it's jut wild eyed dreamers.
Pe
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There's a distinction to be drawn between "crowdfunding" (seeking capital to develop a product) and "patronage" supporting the ongoing expenses of an artist. There are niches where crowdfunding can be effective (boardgames, for example), but anyone who crowdfunds an electronic device is a moron.
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One of the child comments mentions "if you can't get VC money then your idea is likely beyond crap" which is silly. Most VCs aren't interested in one-off hardware ideas. They don't have the explosive growth that's attractive to VCs. Hardware is hard, and I think someone needs to push for crowdfunding to involve more than maybe getting the product at a slightly-below retail price, or nothing. Laws need to be changed, but give these people stock in the resulting company
Re: Ha! Ha! (Score:2, Insightful)
Also, VCs and other investors are one step removed in the wants prediction game. They try to predict what other people will want, where crowdfunding backers only need to figure out what they themselves want. Keynesian beauty contests can take you strange places, so this advantage is not small.
The other thing you need to figure out though, is the entrepreneur's ability and willingness to deliver. The crowd does not have an advantage here. Professional investors should ideally be better at it, but they do the
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I mean, the same thing is true for VCs who invest in new/start up businesses. They are also the ones holding their dicks as they have no return on their investment.
Again...think of crowd funding like doing a VC investment, in terms of risk...It has a high-likelihood of failure.
However, unlike doing a VC investment...the rewards are often pretty low...you simply get the product you paid for. Not the large pay outs or ownership interest of a company that could be worth a lot of money.
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The good thing about crowdfunding is that there's no real collateral damage if the venture fails.
Sure the people who buy in because they like the idea, and want the finished product are on the hook what amounts to disposable income. The folks developing the product don't need to go into hock to fund their vision. There's no bank holding the bag in the event of default.
Seems like a pretty good setup to me.
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The issue I have with Crowdfunding is that it is a High Risk Low Reward investment,
That is kind of the point of Crownfunding model. A lot of people risk a little money, and when it pans out, they get their bits, and if it doesn't, no big deal, because it is a RISK.
This is a poor mans version of venture capital. If you want the rewards of success for venture capital, then you'll have to be willing to risk the kinds of money those people invest. Most people don't have the money or the skills to walk a high risk investment to the reward stage, but want to participate "early" in a good idea.
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Oh-shit!
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Copper? Audiophiles do it with silver.
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No, son, we do it with platinum.
Oh, wait. Shit. I gave our secret away.
Re: This is difficult to understand (Score:2)
Oxygen-free Silver with a Special crystal structure
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Yes. Not exactly hi-fi though.
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In a real startup, the risk is offset by the possibility of getting a piece of the profits if things go well.
In crowdfunding you accept all of the risk in exchange for none of the reward. Palmer Luckey turns your $2.5 million into $2 billion and you don't see a dime.
People who join crowdfunding are rubes.