Startup News & Analysis

ASX-listed wearable tech startup Nuheara raises $9 million for its intelligent earphones

Angela Castles /

Nuheara

Nuheara founders Justin Miller and David Cannington. Source: Supplied

Wearable tech startup Nuheara has raised $9 million from institutional investors, just five months after the ASX-listed startup began distributing its intelligent earphones.

The patented Nuheara earphone technology allows users to alter sound levels, amplifying conversations and suppressing background noise.

It was developed by co-founders Justin Miller, formerly chief executive of global communication company Sensear, and San-Francisco based David Cannington, in collaboration with scientists from universities in Australia and overseas.

“The real smarts in our product is the ability to overlay the digital and physical world,” Miller tells StartupSmart

“Augmented hearing is the same in principle as augmented reality. Perhaps you’re at the football, you’re streaming the commentary, you’ve turned down the roar of the crowd but you’re still being able to talk to the person next to you,” he says.

As Australia’s only listed consumer wearables company, Nuheara has had an unconventional path to success.

Since backdoor listing on the Australian Securities Exchange pre-revenue, Nuheara, which is co-located in Perth and San Francisco, has become the first listed company to run a crowdfunding campaign, which gained more than $1 million in funding from 80 countries in a 60-day period in 2016.

For Miller, crowdfunding was a key way to gain exposure and test the market.

“We were able to validate to investors that people wanted this product,” Miller says of the success of the campaign, noting that it also “brought 100 plus distributors to us” so that Nuheara was “ready to hit the ground running in retail” this year.  

The company’s latest capital raise follows a $4.65 million round in May, and brings Nuheara’s total fundraising to $20 million since listing. Miller says Nuheara plans to use the funding to expand its technological offerings and ramp up its retail presence.

In the latest raise, Wilson Capital management come on board as one of 10 institutional investors that were issued approximately 97.8 million new shares at 9.2c per share; a 2.5% discount to the 15-day volume-weighted average price.

Since listing in March 2016, the company’s share price has risen from 2.5¢ to about 9.6¢, an increase of 284%.

An alternative to venture capital

Nuheara’s unconventional decision to list on the ASX came after the startup ran into difficulties securing venture capital investment in Australia.

“We tried the VC route in Australia — our aim was to remain Australian,” Miller says.

“VC’s in Australia wanted us post revenue and as a hardware based business it was impossible for us to do; we needed capital to get the hardware up,” he says.

“It’s disappointing — I would have liked the VC market to have embraced us a little more.”

Australia’s venture capital investment has been struggling to keep pace with world standards, according to recent reports, and Miller advocates for startups to consider listing on the ASX as an alternative path to seeking venture capital investment.

“We listed on the ASX very early on and showed that path as a means to raise capital,” he says.

Miller notes the visibility of ASX listing “keeps us [Nuheara] on track” and “provides a high level of governance”. 

We used it [the ASX listing] as a marketing and validation tool,” he says, saying startups can experience similar success on the share market if they “under promise and over deliver”. 

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Angela Castles

Angela Castles is a Journalist at StartupSmart with a keen interest in the legal issues startups face. In her free time she can be found eating sushi and seeing live music.

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  • Holly

    Wow – as someone who wears a cochlear transplant it would be interesting to see if there’s possible cross collaboration with Cochlear in Australia regarding background noise which we who wear devices struggle with. Cochlear is also trying to improve how music and singing sounds via their devices.
    Clearly these guys are onto something and to be congratulated.