Perth startup Nuheara, the first wearables company to list on the ASX, has developed technology that lets people hear what they want to hear

- June 16, 2015 9 MIN READ

Imagine a world where you can hear what you want to hear. Sounds impossible, right?

It may take more than a minute to accept the idea that technology can enable us to control how and what we hear. But Nuheara, a startup based out of Perth and San Francisco, is set to make this a reality. In partnership with Curtin University in Western Australia, the startup is developing innovative augmented ‘Hearables’ (ear buds) that allow people to control their hearing experience with the help of a smartphone app.

The startup’s flagship product, which was only unveiled last month at the Wearable World Congress in San Francisco, can be described as a hybrid between assisted listening devices, Bluetooth earplugs and noise-cancelling headsets without cables or wires.

Whether it’s augmenting speech in social environments, listening to music in stereo, or connecting to voice enabled apps like Siri or Internet-of-Things (IoT) devices, Nuheara’s aim is to give the consumer the power to orchestrate their hearing experience via the Nuheara app and with the tap touch functionality on the ear buds.

At some point in the past decade or two, wearing earphones and headphones became socially acceptable and then mainstream. The widespread adoption of such products led to the emergence of a new experience: the private public experience. By wearing a pair of headphones or earphones, people instantly disconnected from the physical world despite them being physically present in it. By splitting ‘physical’ and ‘mental’ events, headphones and earphones have allowed people to privatise public spaces and coincides with our growing desire for personal space.

However, there are downfalls to this. For instance, if a person is crossing the street while listening to audio at a volume that overpowers environmental noise, they may not hear cautionary sounds like car horns or ambulance sirens. This could lead to – and has led to – accidents. Or, if someone is listening to music while walking back home from the local train station on a quiet night, they may not be able to identify or respond quickly to danger in their environment.

With Nuheara, the user can adjust the volume and clarity of the various sounds in their environment. If they’re listening to a playlist on Spotify, for example, but still want to be able to hear what’s going on in their physical environment, they can push the music back into the background, so it’s less prominent than, say, the sound of footsteps approaching the user or cars driving by.

Nuheara’s tehnology can also be used to cancel out sounds that are bothersome in particular circumstances. For instance, if the user picks up a phone call while travelling on a noisy bus and can barely hear the person on the other end of the call, they can open up the Nuheara smartphone app and tune out the chatter in the background and focus on the phone conversation. Or, if the user is having coffee with a friend at a busy cafe and finds it difficult to keep up with the conversation due to background noise, they can augment that person’s speech.

The processors inside the ear buds can recognise what is and what isn’t speech, allowing the user to adjust surrounding sounds to their liking. The technology is effective to the point where users can be at a football game and turn the volume of the cheering crowd down and focus on the commentary, while still being able to converse with the friend sitting in the adjacent seat.

Preferences for each scenario can be saved for future reference so that users don’t have to constantly adjust the settings when they’re in different environments. If the user is on a bus, they can select the settings that were saved previously for when they’re on a bus. Or if they’re in a noisy cafe, they can select the settings that were saved previously for when they’re in a cafe.

Many more hypothetical scenarios can be presented, but essentially, Nuheara has reimagined the future where consumers have the power to hear what they want to hear, literally.

Nuheara was founded by Justin Miller and David Cannington who have 50 combined years of experience commercialising hearing technology. Miller, who is based in Perth, was the founder and CEO of industrial hearing technology company Sensear. Cannington, who is originally from Melbourne and relocated to San Francisco 20 years ago, was the Global Chief Marketing Officer of the same company.

During their time at Sensear, Miller and Cannington were approached numerous times by people wanting to find out how they could get their hands on the company’s technology for personal use. Because Sensear’s technology was designed for the industrial market, it got Miller and Cannington thinking of how they could potentially bring that technology to the consumer market. It wasn’t long before the wearables industry began to explode; and Miller and Cannington recognised an opportunity.

International IT research organisation, CCS Insight, forecasts 250 million wearables to be in use by 2018. According to a report titled produced by Nick Hunn titled The Market for Smart Wearable Technology, Hearables will be worth $5 billion by 2018 – roughly the same size of the entire wearables industry currently.

Nuheara is also straddling other multibillion markets: the hearing aid market ($6 billion per annum) and the headphone market ($8 billion per annum). Added to that, thousands voice-enabled apps like SIRI and Google Now are becoming more mainstream. Nuheara is looking to capitalise on the intersection of these high-growth markets.

Nuheara’s hardware and software is being built in partnership with Curtin University of Technology in Western Australia. The university has a strong background in the research, development and testing of advanced audio digital signal processing technologies. Professors Sven Nordholm and Kevin Flynn from Curtin University of Technology are joining the company as co-founders and will be part of its management and development team. Nuheara, however, will retain 100 percent ownership of all IP developed as result of the partnership with the university.

Nuheara has been in stealth mode up until last month when it revealed its prototype at the Wearable World Congress in San Francisco.

Cannington said the response at the conference was overwhelmingly positive and encouraging: “Hundreds of people at the conference came to our booth and were just blown away by our technology.”

“It’s really exciting. We’d like to think that in a couple of years from now, we’re going to be the most talked about wearables company to come out of Australia.”

Adding to this, Miller said, “We’ve spent a lot of time in the last six months proving the concept. What we’re doing is fairly difficult, and we didn’t want to put ourselves out there if we weren’t sure we can do it. We came out in confidence knowing we’re on track to building what we [envisaged].”

Miller, who lives in Perth, also mentioned he was amazed by the wearables ecosystem in Silicon Valley. Cannington on the other hand, who is based in Silicon Valley, said he lives and breathes wearables every day, so it was hard for him to believe consumers in other parts of the world are only beginning to understand and adopt wearable technology.

Nuheara was accepted into the Wearable World Labs accelerator. Wearable World will become a shareholder in Nuheara, and is currently assisting the startup’s market development programme.

Last month, the startup also announced its plans to reverse list on the Australian Securities Exchange (ASX) later this year. Wild Acre Metals (ASX: WAC) is set to acquire 100 percent of Nuheara, making the startup the first wearables company to list on the ASX. The news was announced ahead of major wearables player Fitbit opening up its Initial Public Offering later this week.

Miller told Startup Daily they weren’t actively looking to list on the ASX; rather it was a matter of circumstance. The ASX  only had 14 mining IPOs last year, and is expecting fewer this year. With the focus shifting away from the mining boom and towards the tech boom, many shell companies are looking for ways to survive. By acquiring tech companies, mining companies have a chance to capitalise on the growth of the technology sector in Australia.

Miller also highlighted the speed of the reverse listing process compared to the time it takes to pitch to one investor after another for the same amount of money.

“When you’re in an emerging tech company, speed is absolutely critical,” said Miller.

Cannington said Nuheara will also be looking to raise additional funds later this year on crowdfunding platform Indiegogo. This will help the company generate traction ahead of its launch, and also assist the company as it moves to the next stage of mass production and commercialisation. By the time the company launches its product into the market, they would need to have spent at least couple of millions of dollars on research and resources, according to Cannington.

“What we’re doing is extremely difficult. We’re not just a software company that can be started and launched fairly quickly. The team we have in Perth are made up of some of the world’s best audio technologists and digital signal processing gurus, if you like. We’ve got a great team building technology that cannot be easily replicated. There are a lot of different layers of expense, mostly resource-based. That’s why we’re raising capital,” said Cannington.

Adding to this, Miller stressed the company is not out to create another cool widget or gadget. The company’s strategy is not to simply create a product that integrates with, and extends the utility of, existing technology, but to build a platform ecosystem. The vision is, in many ways, similar to that of Apple’s before it launched the first iPhone. Apple didn’t just create a hardware product, it created a platform, allowing developers to then create apps that are compatible with Apple’s mobile operating system.

Similarly, Nuheara’s plan is to reach critical mass and encourage app developers to create and deliver voice-enabled solutions across a range of consumer-driven needs and associated smart devices.

“Our aim is to be a platform that will enable people to run their own software – whether that’s voice recognition software, translation software or something else. We’re allowing app developers to be creative. For instance, if you think about translation on the fly, where Chinese speech hits the plug and English comes out on the other side, that’s where we’re moving to,” said Miller.

“On top of that, we [as a society have] become very visual. We’re always looking down on our phones. Our aim is to bring people’s heads back up so they can speak out their text messages, or use speech to do other things.”

The co-founders believe Nuheara ticks the three key boxes required for growth and longevity of wearable companies. Nuheara spoke with the International Data Corporation (IDC), who said there the first of the three factors are to go beyond the smartphone. Wearable technologies need to offer functionality that’s independent of the smartphone.

The second is: make something that looks and feels cool.

“We’re not about providing some hearing assistance; we don’t want our technology to be categorised as a hearing aid. I think industrial design does a fantastic job of delivering coolness. What we want to do is deliver a product that people feel proud of wearing,” said Miller.

And the last is: solve a problem.

“Things like the smartwatch are going to end up at the back of people’s drawers, because they’re not necessarily solving day-to-day problems,” said Miller. “We believe we tick all three boxes.”

The co-founders also acknowledged the importance of having a global mindset, a sentiment that well-respected Silicon Valley-based entrepreneur Steve Blank has communicated many times.

Blank’s article, Born Global or Die Local – Building a Regional Startup Playbook, reflects on the attitudes of Australian SportsTech entrepreneurs who, he found, were more focused on local dominance than achieving global scale. From his interactions with Melbourne-based founders, he realised that “most of the founders who said they wanted to grow big hadn’t given much thought about how they would go about building size and scale.”

“The biggest mistake for most of these startups was not understanding that optimizing their business model for the 24 million people in the Australian market would not prepare them for the size and scale they needed to get to big,” Blank writes.

“Instead of beginning with just a focus on Australia, these startups needed to use the business model canvas and articulate which of their hypotheses should be tested locally and what would require getting on an airplane to test by watching someone’s pupils dilate face-to-face.”

Agreeing with this view, Cannington said the challenge for many Australian companies – even funded ones – is that they’re not thinking globally from the get-go.

“Generally, they (startups) are not as comfortable making that big leap into the global market, whether it’s through Asia or the US,” he said.

“What helps us (Nuheara) stay ahead of everyone else is we’re already there (in the US). We’ve already tapped into global networks. The learning curve for us is smaller than most other Australian startup founders.”

Cannington added, “We are an Australian founded audio wearables company. But where is the wearables ecosystem in Australia? It’s non-existent. We’re fortunate that we’re smack bang in the middle of the biggest wearables ecosystem in the world (in Silicon Valley).”

Miller said that many Australian startups say that they’re globally-oriented, but their words don’t ring true when it comes to practice, because they’re not implementing a global strategy.

“Quite often that means establishing a physical presence in other countries. To say you can do everything from here (in Australia), it’s actually not that easy,” said Miller.

Moving forward, a big challenge for Nuheara will be educating the market about the capabilities of its technology.

“It’s not necessarily going to be easy for us to explain what our technology can do. Unless they physically test it out, it’s going to be difficult to understand. This is because the experience is going to be different for different people,” said Miller.

“But we believe in the power of social media and the power of peer reviews. That will educate the market quicker than anything else.”

Nuheara plans on taking its product to market by the end of 2016. Nuheara’s ear buds will cost around $300, not all that different to a pair of Beats ear buds, while Nuheara’s smartphone app will be free to download from iTunes and Google Play.

Featured image (L to R): David Cannington & Justin Miller, Co-founders of Nuheara.