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2016 Business Plan

Confidentiality Agreement

This agreement is to acknowledge that the information provided in this business plan is unique
to this business and confidential; therefore, anyone reading this plan agrees not to disclose any
of the information in this business plan without the expressed written permission of OptiHear
Sound Visualization LLC.

It is also acknowledged by the reader of this business plan that the information furnished in
this business plan, other than information that is in the public domain, may cause serious harm
or damage to OptiHear Sound Visualization LLC and will be kept in the strictest confidence.

This is a business plan. It does not imply an offering of securities.

Table of Contents
Executive Summary 3

Quick Facts on Hearing Loss 4

The OptiHear Solution 5

User Interface 6

Market Analysis 7

Marketing Plan 9

Operations 11

Financials 12

References 15
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Executive Summary

Company Mission

Our mission is to provide a comfortable and portable solution for hearing loss
that helps minimize the effects of disability, thereby improving the quality of life
for our users.

Product Overview
• OptiHear is a wearable head-mounted assistive device for deaf and hard-of-hearing
individuals that allows users to visualize sounds around them.
• Through a unique head-up display, users are instantly notified of sound type and location
through visual cues in their periphery.
• Tactile feedback alerts the user when their name called through gentle vibration.
• A discreet micro-LED array is embedded into the frame of common eyeglasses that can
be fitted with prescription lenses.
• Our patented algorithm turns frequency into colour.
• Through our free app, users can completely customize OptiHear’s sensitivity, brightness,
and frequency response to match their own personal hearing and lifestyle needs.
• OptiHear is perfect for working professionals, seniors, and even has military applications.

Financial Summary
• OptiHear offers two stylish frame options available in our online store and through
healthcare providers.
• Frames retail for $479 and $539 and cost $225 and $245 to make (55% profit margin)
• We have already presold 1200 OptiHear devices through Kickstarter.
• OptiHear was awarded a $1.4 million seed grant from the U.S. Department of Defense.
• With a current funding need of $2 million, our company is currently seeking investors and
strategic partners in the biotech industry.

Contact Information
Erika Johannessen
Queen’s University
Biomechanical Engineering
(613) 331-5860
erika.j@queensu.ca
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Quick Facts on Hearing Loss

Prevalence and Risks


• About one in six adults over the age of 18 reports having at least some trouble hearing.

• This equates to about 3.4 million Canadians!

• Hearing loss is most commonly caused by damage to hair cells in the inner ear.

• One billion people worldwide are at risk of hearing loss due to unsafe listening practices.
Hearing Loss and Age
• The prevalence of hearing loss increases with age.

• It is the third most common chronic physical condition.

• Men are twice as likely as women to have hearing loss.

• Three in five veterans suffer from hearing loss.

• It is the number one war wound.

• Hearing loss is linked to social isolation, depression, and even dementia.

Current Treatment Options


• There is currently no cure for hearing loss.

• Hearing aids amplify sound and improve speech recognition and are the most commonly
used assistive devices for hearing loss.

• Cochlear implants are used in severe cases of hearing loss and are surgically implanted
electronic devices that stimulate the cochlear nerve directly.

• Although there have been significant advancements in these technologies over the past few
decades, these devices still do not have the ability to preserve the spatial
information of sound.

• Hearing aid users are left facing huge challenges with environmental awareness,
communication with others, and delayed response to potential danger.

Other Alerting Devices


• Assistive alerting devices such as modified doorbells and smoke
detectors provide visual and tactile cues of important events
when they occur, but these technologies are bulky, non-
portable and require prior installation in the user’s home
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The OptiHear Solution

OptiHear is a state-of-the art sound localization technology for deaf and hard-of-hearing
individuals that provides real-time feedback of acoustic surroundings in a non-distracting
and informative manner. OptiHear is fully customizable to user needs and is disguised
within the frame of common eyeglasses! Our technology uses a combination of light and
vibration to alert deaf and hard-of-hearing individuals of their surroundings.

Intuitive Discreet Customizable Non-Distracting

The Science of Sound Localization


Humans use subtle timing and volume differences between ears to localize sound. When one
or both ears experiences hearing loss, sound location cues become disrupted, and information
about the directionality of sound is lost. Hearing aids amplify sound, but unfortunately
obstruct the ear canal and actually decrease sound localization performance!

OptiHear is able to detect small differences in amplitude and timing between


three sound sensors to calculate the direction of the sound source in relation to
the user to within an angle accuracy of 20 degrees.
Sound Amplitude Time-of-Arrival of Sound
There are two main reasons why sound OptiHear microphones measure the time-
volume is different at each sound sensor: of-arrival of a sound wavefront and use this
to determine location. The wavefront of
1) The physical barrier of the head causes sound reaches the microphone it is closest
an acoustic shadow that distorts sound to first!
frequency and decreases volume.

2) Sound follows an inverse square law,


meaning it decreases in amplitude with
increasing distance from the source.

Wearable Head-up Display System


OptiHear’s unique interface was designed using head-up display technology that was originally
developed for military aviation. Research shows that displaying relevant environmental
information in the peripheral visual field decreases cognitive workload, increases
performance, and reduces operator distraction. 5
User Interface

Sound Location
OptiHear contains an array of three sound sensors
embedded into the frame of common eyeglasses. The
precise placement of each sensor allows for tiny
differences in sound volume and timing to be detected.
The user’s environment is broken up into 16 zones, each
representing a direction of space. Using BlueTooth
technology, OptiHear communicates to the user’s wireless
device. The OptiHear application then determines the
direction and frequency of sound and transfers this to a
discreet micro-LED display located on the inside of the
frame. Within less than half a second, the user is alerted to
sound nearby.

A micro-LED display located on the inner frame of


OptiHear immediately and intuitively alerts the
user to sound by mapping their surroundings into
sixteen spatial zones.

Frequency-to-Colour
OptiHear’s unique patented frequency-to-colour algorithm indicates the type of nearby
sounds through LED colour. Following the natural logarithmic nature of human hearing,
Optihear’s frequency-to-colour algorithm breaks sounds into three main frequency bands
of common noises. Blue, yellow, and green light are easy to distinguish, even for our red-green
colourblind users!

Tricolour
Micro LED
Display

Low Mid-range High


Blue light signifies low Yellow light signifies the Green light signifies higher
frequencies, such as a barking middle-range frequencies frequencies like alarms,
dog or the slow rumbling of specific to human voices. bells, and birds.
an oncoming train!

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Customizability

One of the pillars of our brand is OptiHear’s in-app customizability. Users can tailor their
device to fit their lifestyle and hearing loss needs.
Adjustable Sensitivity
and Display Brightness

Extra Features

Rechargeable Locates two Programmable


150 meter range
battery with sounds Name
BlueTooth
72 hour life! simultaneously Recognition

Market Analysis
Hearing Aids Glasses

• Similar to hearing loss, vision problems


• With today’s aging population, hearing loss increase with age
and hearing aid use are on the rise! • Six in ten people wear glasses
• The #1 distributor of hearing aids in the U.S. • Over 94% of people over the age of 55
is the Department of Veteran’s Affairs use glasses!
• Hearing aids range in price from $500- • The average price of glasses is about $195 7
$5000
Market Analysis

SWOT Analysis

Strengths Weaknesses
• First ever user-centered sound
localization • Lack of capital and reliance on
investors for seed money
• In app customizability
• Lack of brand recognition
• Patented technology

Opportunities Threats
• Rising prevalence of hearing loss due • Big Tech companies
to unsafe listening practices • Hearing-aid advancements may someday
• Aging population allow the preservation of sound
• Increased acceptance of assistive localization information
technologies

Primary Market Research

Before designing OptiHear, we surveyed 50 adults across the US and Canada who self-
identified as deaf or hard-of-hearing and asked the features they’d like to see in a device.
Here are the results:

“Won’t be noticed by others”

“Little to no learning curve”

“Fits my needs”

“Doesn’t get in the way”

“Lightweight and portable”

Based on the top five most listed responses above, we designed OptiHear technology with our
users in mind. 8
Marketing Plan

Target Customers

Based on our market research, both hearing aid use and need for glasses increase with
consumer age. Therefore, we plan to target customers who fall into one or both of these
consumer groups.

Although hearing aids have been proven effective for noise amplification, only 30% of people
who could benefit from this technology actually use it! Whether they are embarrassed or
reluctant to seek help from an audiologist, we hope to decrease the stigma associated with
assistive devices by providing our customers with a discreet and stylish way to be alerted to
sounds around them.

OptiHear is ideal for deaf and hard-of-hearing individuals who want to minimize the effects
of their disability so that they can remain active members of their families, communities, and
their jobs.

Our target consumer groups in the U.S. and Canada are:

In addition to targeting working adults, retired


people, and the veteran population, we also
plan to market our product to hearing
healthcare providers such as audiologists and
ear, nose, and throat (ENT) physicians. These
care providers are at the frontline of hearing
loss diagnosis and hold the trust and respect
of their patients.
Product Styles
At launch, OptiHear will offer two stylish unisex frame options. Both styles have a lighter
colour on their inner frame, which make them “disappear” from the visual field of the user.

Classic Bold

• Timeless black • Trendy brown


frame tortoiseshell
• Sleek • Lightweight
• Professional • Modern
• $479 MSRP • $539 MSRP
• 55% profit margin • 54% profit margin
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Marketing Plan

Distribution Channels

At launch, OptiHear will be available exclusively online and through hearing healthcare
providers. Eventually, we’d like to see OptiHear sold at eyewear retail stores across North
America.

Selling direct-to-consumer OptiHear will be available to


online means we can keep order through audiology
our profit margins high! clinics and anywhere hearing
aids are sold!

Advertising
OptiHear will be advertised through a variety of avenues targeted to our broad consumer
base.

• Social media outlets like Facebook, Instagram, and Twitter will increase our likelihood of
going viral and will target a younger audience. Influencer marketing, or using celebrities to
endorse products, will be especially advantageous here.
• To reach a professional market, print ads for OptiHear will be featured in Forbes Magazine.
• To reach hearing healthcare providers, OptiHear will be advertised on the MedScape
website (the most popular website for doctors) and Audiology Today magazine.
• Search engine advertising with Google will also be used. OptiHear’s webstore link will
automatically appear when someone searches for related keywords.

Intellectual Property

OptiHear was issued utility patents in 2016 in both the U.S. and Canada for our
unique frequency-to-colour algorithm. We also have a design patent on the
microphone array inside our frames. International PCT patents are pending.

We also hold a non-exclusive license with the U.S. Department of Defense.

Industry partnerships
OptiHear partners with Mimi Hearing Technologies, an audiometric testing
company based in Germany that provides a free at-home hearing test through
their app. We are also in negotiation with Luxottica Group SpA, the owner of
LensCrafters, to sell lenses for our frames through our website. 10
Operations

Location

The OptiHear office headquarters will be


located in San Diego, California. The San Diego
biotechnology cluster is one of the largest in
North America, housing over 1,100 life
sciences companies, 80 research institutes, and
9.5 million square feet of lab space. The area’s
mild weather and affordable housing market
(especially compared to Silicon Valley) make it
an attractive employment destination for the
world’s most talented scientists and engineers.

Key Personnel

We currently have two full time associates at OptiHear.


Erika Johannessen Arli Barrios
President and Director of Research, 55% owner VP and Director of Operations, 45% owner
Erika has a master’s degree in biomechanical Arli holds a PhD in electrical engineering and
engineering and has over 8 years of laboratory has worked for 3 successful biotech startups
research experience. in the Silicon Valley area.

By the end of next year, OptiHear will be hiring directors of marketing and
finance to help us scale our productions and expand our brand.

Inventory and Manufacturing


OptiHear contracts a third party manufacturer in
China who makes the high-quality plastic housing
for our technology. Additionally, San Francisco
Circuits prints the hardware components for our
frames. All sensor calibration, device assembly,
and shipping is done at our headquarters.
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Financials

5 year budget

Our five-year budget projection is $4 million, including $710,000 in startup costs for the first year.

Financial Projections

A) Break even point


B) Pay back investors 12
Timeline and Accomplishments

Funding Sources and Need


OptiHear had a very successful Kickstarter launch in November of 2016 and presold 1200
units within 3 weeks, tripling its original funding goal of $200,000. The company also received a
startup grant from the U.S. Department of Defense in exchange for a non-exclusive license for
OptiHear’s IP. OptiHear glasses allow soldiers to maintain their sense of situational awareness
in the field while giving them the option to wear protective earwear, preventing long term
hearing damage.

OptiHear is currently seeking $2


million in external seed funding to
help bring our product to market.

We are in search of investors


and strategic partnerships in
the biotech industry in exchange
for equity in our company. 13
Contact

For inquires, contact:

Erika Johannessen
Queen’s University
Biomechanical Engineering
(613) 331-5860
Erika.j@queensu.ca

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References
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