Social Listening for Product Development

Michael Mendenhall: I want to introduce one of our customers who was here last year. He's an amazing guy. He started out in 2008 with a company, but it was a really revolutionary advanced technology company. When he started this, wore many hats. We're going to talk about all the hats. He was CFO, he was the engineer, the only thing I didn't see was CMO. I don't know what happened to the go-to-market group, but anyhow, he has scaled and is really revolutionized audio technology. So I want to introduce you to the CEO, founder of Odyssey. Sankar. Sankar, come on up.

Sankar Thiagasamudram: Thank you, Michael.

**Michael: **You're welcome. So let's go back and maybe we go back Sankar before 2008. So what were you doing before 2008 that then led you to form this company and to really revolutionize audio and listening?

Sankar: So before 2008 I was designing video cards and I was working at a company called DVS and Odyssey started as a hobby. So we made these planar headphones and we took it to an audio show and people wanted to buy it. And these were headphones designed for musicians and sound engineers. And it gradually grew ‘til 2013. It was more or less a hobby, part-time stuff. And 2013 is when we started doing this full time.

Michael: And you're working with Grammy nominated artists. When I say artists, engineers, sound engineers, who are looking to you for high quality fidelity. Talk to us a little bit about how you revolutionized and we'll pick that up in a second because this is actually a major product that he's going to be talking about. Can you tell us a little bit about, I know there's magnets and things involved, what it is that differentiates your high-fidelity headsets from all the others, whether this be Beats and all the rest of them, Bang & Olufsen. What's the difference?

Sankar: Most companies use cone speakers. That's 99.5% of the headphone market or even speaker market. What we do is a different technology called planar magnetic headphones, where there is a small thin film and these headphones are way more accurate especially for musicians and sound engineers. They give you the accuracy that they need for mixing, mastering decisions and stuff. Now we have branched, taken the same thing and put it into gaming headphones and stuff.

Michael: Well I think it's so important because for the first time, the song that you heard, I co-wrote, and then as you go through the process of mixing and mastering, you're going into different settings with different sets of speakers. And then what happens is by the time you get to market or drop the song, you're like, "Well, that wasn't the way I heard it when we mastered." I think something like this, does your product actually help with the consistency of producing the music?

Sankar: Yeah, that's the primary goal. For us to, what we want to do is to reproduce sound as accurately as possible. So there's zero distortion. So that's the North Star. So all our headphones are designed, keeping that in mind.

Michael: Now, you're talking a lot about the professional nature of the headphones. Do you do stuff for consumers as well?

Sankar: Yes, we do. 2017 we started our first gaming headphones and we have a headphones that we call Mobius that has spatial audio. That was one of the first headphones with spatial audio. We released that and we just released a headphone for Xbox on PlayStation.

Michael: Well I tell you, this gaming headset is pretty amazing. I used it, I think it was last year. I heard it. And the sound really is spatial. It's all around you and really places you in the environment. And certainly with the new technologies coming out in gaming, where they're really building you into those environments, a headset like this is pretty awesome. During COVID, a lot of disruption happened. Most people were working from home, 60% of them still are working from home. And they went into these environments where everybody had to use telepresence, everybody had to be on camera, whether it's Microsoft Teams, Zoom, you name it. And they're now getting used to, "well how do we do business this way?" And you seized an opportunity. You saw something that was problematic and you're like, "we’re going to redesign and refine what that audio world looks like in your home."

Sankar: Correct.

Michael: So talk to us about that because this is really interesting. Because there's so many opportunities during COVID and so many innovations that have happened during COVID that to see what he has done for your home is pretty amazing and revolutionary. There is nothing on the market like this. So talk about this.

Sankar: Sure.

Michael: And by the way, this is the product. Yeah, it's pretty amazing.

Sankar: So what we found out here, during COVID…

Michael: I’ll do this while you talk…

Sankar: What we found out was some days we work from home, some days we have to go to work and most conference calls speakerphones are pretty big. They are huge conference calls speakerphone and the microphones are in them are pretty…

Michael: I couldn't figure how to get that up. Oh, there we go. Yeah, now you talk about it. Here you go.

Sankar: So this uses our planar technology, but it also has two microphones. And in artificial intelligent chip, what it does is it identifies everything that is not human voice. So if you have a pet sound or children crying or police sirens.

Michael: Dogs barking.

Sankar: Yeah, dogs barking. What it does is it completely eliminates them. So all you hear on the other side of the Zoom call is just your voice. And then people don't want to wear headphones all the time because they're on Zoom meetings five to six hours a day. So you can have a speaker and it's directional. But once in a while, if you go to work you can take it there and you can leave it and you can use it for five to six people conference calls also.

Michael: Oh, that's fantastic. So is this just for B2B or is this going to go to consumers?

Sankar: We are going to sell it for both B2C and B2B. We are getting it Zoom certified and all that stuff now.

Michael: Oh, that's fantastic. When will they see this in the marketplace?

Sankar: We are planning to start shipping in end of February, early March.

Michael: That's awesome. Have you seen any sort of supply chain issues as well? Most of these electronic companies that are here at CES have had situations. We've talked to several of them. Yeah, there's still delays. Is it getting better?

Sankar: It's depends. I was coming from Orange County and as the plane takes off, you can see the Long Beach port and I think I counted about 12 cargo ships in the sea.

Michael: Just sitting.

Sankar: Just sitting there, right? So I think the problem is still going to be acute in 2022. Hopefully by end of 2022, we will see the supply chain issues ease. What we are doing is this, trying to see if we can redesign and be nimble as a small company to take advantage of it.

Michael: Yeah, just hang on, I want to step off and pull another one of your products up here.

Sankar: Okay.

Michael: Now I want to be like Elon Musk. Elon Musk actually has these headphones and you can see them in a picture with Elon Musk. So what…

Sankar: Yeah, you found history of it?

Michael: Yes.

Sankar: He didn't post it, it was...

Michael: Yeah, no, he did this on his own. And you found it probably online. Yeah. So what does this do that Elon would want to listen to this headset?

Sankar: I think he was releasing a piece of music. I don't know. He has released two songs actually on Spotify. And during one of those song releases he was wearing this headphone and jamming and he posted it on his own Twitter.

Michael: Oh wait, so he's writing songs too?

Sankar: Yes.

Michael: I can't wait. When are those being dropped?

Sankar: I don't know, but one of the songs is about a gorilla in South Africa I think.

Michael: Oh, is it really?.

Sankar: Yeah, that's…

Michael: Oh, that's awesome. Well, he is listening on these. Talk to us about these. Why are these different?

Sankar: Different? So these are our original planar headphones. They have the planar magnetic technology and these are incredibly accurate. So you can mix master, I mean you can use them for anything. These are perhaps one of the most accurate headphones that are available in the market now.

Michael: That's fantastic. And these could be for consumer as well?

Sankar: Yeah, a lot of audiophiles, consumers buy it, people from research universities buy it. A lot of professional musicians, as well.

Michael: Oh, that's awesome.

Sankar: So it has a very wide application use.

Michael: So now we have new headphones. We have a new speaker system that eliminates all of the distractions and noises that are ambient that you don't want on your calls. What's next?

Sankar: More gaming headphones.

Michael: Yes.

Sankar: Gaming headphones.

Michael: Is that huge for you? Is that a big market?

Sankar: In 2017, we started gaming 2018, actually, we started shipping, it is 30% of our revenue now. In 2022, we expected to be at least half our revenue. So that market is booming. And even music and games are getting incredible. You have amazing composers composing music for some of the games. So gaming audio is spatial. It has a lot of opportunities as well.

Michael: That's awesome. And I think your business did incredibly well during COVID.

Sankar: Yes. So we were able to take advantage of all the work from home. A lot of musicians had to work from home, said they needed headphones, a lot of gaming as well, so.

Michael: I hope through all of that, that TriNet actually supported you, supported your people to actually do this incredible work.

Sankar: Yes. We are very thankful for TriNet because when the pandemic hit, we actually had to close our factory for two and a half months. So we called TriNet and we were like, "what do we do? We can't force these things." So actually, they helped us to figure out what are all the options and they actually told us, "you can reduce salary by this much, but people can still have health insurance." One of the important things when we closed down the factory was, we did not want any of us to lose health insurance. So actually, TriNet helped us to figure all this out so we did not lay off anybody. And we kept everybody on board and we were able to get health insurance for everybody covered as well.

Michael: Well that's wonderful. We love having you as a customer. You guys are so innovative. You're doing things that are sort of remarkable, that are revolutionary. That's what the CES is all about, is to showcase the innovation, the entrepreneurship. You started small, you've grown to where you've had a Series B. You're really well on your way. The product is amazing and I love the fact that you didn't start in audio but wound up in it, and now you're in the entertainment business. I like that.

Sankar: Thank you, Michael.

Michael: Yeah. Thank you very, very much for being here.