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3D Headphones Startup Shutters, Leaving Backers Empty-Handed and Hundreds of Dollars Poorer

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Ossic, the company developing the Ossic X over-ear headphones designed primarily for virtual reality headsets, has ceased production after failing to deliver pre-orders to crowdfunding backers and is shutting down “effective immediately.” While Ossic blames lack of demand for its niche product (in addition to manufacturing difficulties), the company sure did raise a lot of money with its headphone concept, and to say people are a bit annoyed they aren’t getting their fancy cans anytime soon is an understatement.

In a Kickstarter update on Saturday, the Ossic team said the company was “out of money” and creating additional headphones requires more capital to start mass production. The company claims it managed to produce 250 Ossic X units, but is unable to package and ship them due to insufficient funds. Ossic said it reached out to other companies and investors to stay afloat, but was unable to reach an agreement.


The Ossic X was billed as “the world’s first 3D audio headphone that instantly calibrates to the listener,” featuring a slew of sensors, six microphones, and head-tracking support for proper placement of audio in a virtual space. Like many crowdfunding projects, Ossic’s campaign suffered from feature creep, and the company cites the addition of stretch goals like support for mobile devices as one of the many reasons development was so costly.


Sure, the Ossic team doesn’t appear to have taken the money to invest in some real estate, but the company’s failure to deliver is curious when you consider how much money they had. Ossic raised a handsome $2,708,472 (shattering its $100,000 goal) from Kickstarter, and $3,248,214 from Indiegogo. It also received an equivalent amount from a seed investment, meaning the nearly $6 million raised through crowdfunding was only half of the company’s total funding.

Many Ossic backers are understandably upset after spending at minimum $200 to back Ossic and receive a pair of Ossic X headphones. There’s now an Ossic X Class Action Lawsuit Facebook group, where backers have gathered to discuss ways to talk to the team to get their headphones or pursue legal action through class action lawsuit.

Of course, disappearing Kickstarter projects aren’t unheard of, but the site’s terms of use have a clear set of requirements for creators who can’t deliver, including providing evidence “that they’ve used funds appropriately and made every reasonable effort to complete the project as promised”

“Under the contract, if a creator can’t complete their project, there are steps they must follow to satisfy their obligations to backers to the fullest extent possible,” Kickstarter told Gizmodo in a statement. “If the backers decide that the creator has not upheld their end of the contract, they may pursue legal action against the creator.”


Gizmodo has reached out to Ossic for comment and will update this story if and when the respond.