SF startup, the 'Fyre Festival of wireless earbuds,' shutters

The message on San Francisco-based startup Kanoa's website stating the company had shuttered its operations. The message on San Francisco-based startup Kanoa's website stating the company had shuttered its operations. Photo: Screen Grab Kanoa Website Photo: Screen Grab Kanoa Website Image 1 of / 28 Caption Close SF startup, the 'Fyre Festival of wireless earbuds,' shutters 1 / 28 Back to Gallery

A San Francisco-based startup has shut down operations, leaving many customers who paid upwards of $139 for a pair of wireless earbuds empty-handed.

Like many startups that came before, Kanoa Inc. ran out of capital, according to a statement on its website. But this startup, which one customer called "the Fyre Festival of wireless earbuds," flamed out after two years of promises.

"This is not the outcome we had foreseen, and with the quick turn of events, we are emotionally overwhelmed," the company wrote in its statement. "We know you are disappointed, and can only ask that you understand that we genuinely tried."

One such unforeseen event included a scathing review on YouTube on Aug. 19. Cody Crouch was one of a number of reviewers and backers who received headphones earlier this month, says Fortune.

In his 27-minute review, Crouch lists a handful of complaints about the earbuds, claiming they struggled to pair with the app, failed to cancel ambient noise as promised and disconnected from the phone when in his back pocket. Crouch also alleged that the company bribed him with $500 in exchange for a "good review."

Less than one week later, Kanoa's investors backed out and the company shuttered. The farewell statement even appears to reference Crouch's video.

"Setbacks and some bad publicity, like reviews of non-shippable beta units, stirred our audience," it says.

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The statement also indicates that customers who pre-ordered the headphones, which were set to retail for $300, probably won't get their money back.

"We are in negotiations with investors for funding, and also large tech companies on an acquisition, while prioritizing our commitment via KANOA to you," it said. "Unfortunately, without that investment, we do not have enough capital to stay operational while we find a solution."

The company also said it had let go of all employees.

Kanoa Inc. dazzled customers with its promise of Bluetooth-enabled wireless earbuds in 2015, more than a year before Apple released its AirPods. Jarrett Abello, the director of software development at a South Florida tech company, bought into the promises. He purchased a pair for $139 in April of 2015. Two years later, he had yet to receive the product.

Abello began calling out Kanoa on Twitter and Facebook, after which he says the company blocked him on all social media. He eventually got a refund after "spamming" the customer service email.

Others weren't so lucky. Ben Fink, of New York, says he and his roommate paid $159 for the earbuds about nine months ago. As an avid tech user, Fink had set up a Kanoa user group on Facebook for troubleshooting. After the announcement, group membership ballooned from 200 to 1,200 overnight. As of Monday, over 2,000 people had joined the group, many of whom took to the page to share their anger.

A separate Facebook page, created to organize a class action lawsuit, claims it has already found an attorney for representation. As Fortune points out, if a class action lawsuit does succeed, it's uncertain where the money would come from.

Requests for comment via Kanoa's customer service email were not immediately returned.

Although Abello got his money back, he says he's miffed as a matter of principle.

He said of the company, "They're the Fyre Festival of wireless earbuds."

Read Michelle Robertson’s latest stories and send her news tips at mrobertson@sfchronicle.com.