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Cash for Jawbone: new funding for headset maker

In 1999, going against the days trends, two Stanford undergraduate engineering students took aim at cell phone technology instead of focusing on the Internet.   With money from family, and a lot of persistence, they started a company called Aliph

jawboneOver the next five years, Alex Asseily and Hosain Rahman hired sound engineering experts and engineers and toiled in an effort to build a better mobile headset. The original plan was to license the technology they developed but along the way plans shifted.   In 2004 Aliph released their Jawbone headsets to critical acclaim.

The headset, which has been optimized by DARPA to improve communication clarity in hostile conditions, brings together a combination of sensors that recognize speech from ambient noise.  Using highly directional microphones and a bevy of signal processing technology, along with a chipset from Cambridge Silicon Radio, the earpieces aim to improve the inconsistent sound quality common to mobile headsets; and by most tests, they achieve their goal.    The Jawbone also has a novel feature: not only does it tune out background noise; it also adjusts the speaker volume relative to the environment. So next time a Harley rumbles past you on the highway, you may not miss an important part of your call.

1999 was long time ago in the time line of technology development but it looks like Aliph’s persistence is starting to, finally, payoff.  The San Francisco company recently closed a new financing.  Khosla Ventures, the newest venture fund from former Kleiner Perkins star and co-founder of Sun Microsystems, Vinod Khosla, invested $5m. 

Khosla Ventures’ partner David Weiden is optimistic about the investment.  He says Aliph is “one of the most exciting companies [KV] has invested in.”   The money from K.V.  brings the total investment in Aliph to about $14m (Mayfield and angel investors have contributed previously). 

Aliph’s Bluetooth Jawbone headset continues to get rave reviews for sound quality and ease of use.  At a price of $120, it’s toward the higher end of the price spectrum but it is well positioned for both the fashionista looking for style and for the Blackberry/smartphone business set who will pay more for better quality.

Originally, the headsets were largely distributed online, but that too is changing. Recent promotional partnerships have earned the iconic looking Jawbone headset premium retail shelf space next to the iPhone (in Apple Stores and Best Buy). Profitability is on the horizon, reportedly,  and also reportedly , more than 100k units have now sold.  The headsets are currently available in silver, red and black. Though unlikely do to inventory control issues, there have been a few unsubstantiated rumors that have hinted other colors might be available later in the year too (a navy blue would be nice).

With greater market exposure and fresh cash for marketing expenses and new improvements,  Aliph is definitely poised for growth.  They could be acquisition bait for Plantronics or Motorola if the numbers are right, but whether they stay independent or end up acquired, their persistence looks like it is indeed paying off.

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