Humm was a wearable tech startup founded in Perth, aiming to enhance memory through neurostimulation. Despite early successes, including accelerator programs and $2.6 million in seed funding, the company faced insurmountable challenges during the Covid-19 pandemic. Ultimately, Humm ceased operations but its technology continues with Rogalife.
What Was Humm?
Humm's main product was the Humm patch, a wearable device designed to enhance memory through neurostimulation. Its unique value proposition lay in leveraging neuroscience to improve cognitive function. Notable achievements include graduating from the Plus Eight and UC Berkeley SkyDeck accelerators and raising $2.6 million in seed funding.
What Happened to Humm?
The story of Humm is a compelling tale of innovation, challenges, and eventual closure:
Initial Success and Expansion: Humm was co-founded by four university friends from Perth and quickly gained traction by graduating from the Plus Eight tech accelerator. By 2018, the team joined the UC Berkeley SkyDeck Accelerator in California, raising $2.6 million in seed funding by the end of 2019.
Innovative Product Development: Humm developed its first product, the Humm patch, designed to improve memory through neurostimulation. The product showed promising results in trials, contributing to the company's early success and attracting investor interest.
Challenges During the Pandemic: The global hardware market became increasingly difficult to navigate due to Covid-19, leading to supply chain issues and severe shipping delays. Additionally, regulatory uncertainties with the FDA regarding the Humm patch's classification as a medical device further complicated matters.
Funding Shortfalls: Despite overcoming many obstacles, Humm fell short in its Series A funding round. The inability to secure enough investment to proceed to mass production ultimately led the company to halt operations.
Legacy and Future Prospects: Although Humm ceased operations, its technology found a new home with Rogalife, a startup aiming to use it to alleviate anxiety. This transition highlights the potential for innovative technologies to find new applications even after the original company closes.
When Did Humm Shut Down?
Humm announced its closure on March 3, 2022, after falling short of its Series A funding requirements. The Covid-19 pandemic exacerbated supply chain issues and regulatory uncertainties, making it difficult for the company to proceed to mass production.
Why Did Humm Shut Down?
Funding Shortfalls: Humm struggled to secure sufficient investment during its Series A funding round. Despite initial successes and promising trials, the company couldn't convince investors to provide the necessary funds for mass production. This financial gap ultimately led to the decision to cease operations.
COVID-19 Disruptions: The pandemic severely impacted the global hardware market, causing supply chain issues and shipping delays. These disruptions made it increasingly difficult for Humm to navigate production and distribution, significantly hindering their ability to bring the Humm patch to market.
Regulatory Uncertainties: Humm faced challenges with the FDA regarding the classification of their device. The lack of clarity in the regulatory framework created significant hurdles, delaying the product's approval and complicating the company's efforts to proceed with mass production.
Supply Chain Challenges: Constant reshuffling of the supply chain was necessary to find the right build for mass production. This process was time-consuming and costly, further straining the company's resources and delaying their progress.
Decline in Data Feedback Speed: During prototype testing, Humm experienced a decline in data feedback speed, which slowed down their ability to iterate and improve the product. This delay impacted their timeline and contributed to the overall challenges they faced in bringing the Humm patch to market.
Lessons Learned from Humm's Failure
Adaptability: Be prepared to pivot quickly in response to market changes and unforeseen challenges, such as global pandemics or supply chain disruptions.
Regulatory Awareness: Understand and navigate regulatory requirements early to avoid delays and complications in product approval and market entry.
Funding Strategy: Secure a robust funding strategy that includes contingency plans for potential shortfalls, ensuring financial stability through all stages of development.
Supply Chain Management: Develop a resilient supply chain with multiple backup options to mitigate risks associated with production and distribution.
Data Feedback: Ensure rapid and reliable data feedback mechanisms during product testing to facilitate timely iterations and improvements.
Investor Relations: Build strong relationships with investors by clearly communicating your vision, progress, and the potential impact of your product.
Market Timing: Assess market readiness and timing carefully to align product launches with favorable conditions and consumer demand.
We Shut Down Startups
Humm's journey underscores the complexities and challenges that startups face, from funding shortfalls to regulatory hurdles. If you're navigating similar difficulties, Sunset can help you manage the legal, tax, and operational burdens of winding down your startup.
Don't let the stress of shutting down a business overwhelm you. Book a demo with Sunset today to smoothly transition and focus on your next venture.
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