OnePlus co-founder Carl Pei speaks on stage during TechCrunch Disrupt San Francisco 2019.
Steve Jennings | Getty Images for TechCrunch
LONDON – Carl Pei, co-founder of the Chinese smartphone manufacturer OnePlus, is restarting.
The Chinese-born Swedish entrepreneur founded a new consumer tech company called Nothing late last year. The company is expected to launch its first product in June, a pair of wireless earbuds called the Ear 1.
While the specs for Nothing’s headphones are not yet known, Pei suggests that they will be minimalist in terms of features. Instead of “20 different levels” of noise cancellation, Pei says, people only need a maximum of two or three settings. Nothing’s products will also have a “retro-futuristic” design, Pei said, adding that the company has spent a lot of time perfecting its design philosophy.
“We want to bring this element of human warmth back into our products,” Pei told CNBC in an interview.
“Products aren’t just cold electronics,” he added. “They are designed by people and used intelligently by people. It seems like product companies (today) are run by big companies.”
OnePlus co-founder Carl Pei’s new start-up, Nothing, announced the name of its upcoming wireless earbuds on Tuesday: Ear 1.
Nothing
Pei and his former colleague Pete Lau founded OnePlus in 2013. OnePlus, majority-owned by China’s Oppo, a subsidiary of Guangzhou-based BBK Electronics, has become known for making cheap Android phones with decent specifications. Pei left the company in October to start his new hardware company.
Pei hopes his new London-based company, Nothing, will shape the consumer tech industry in the same way that Apple’s iMac G3 rocked the PC market in the late 1990s and early 2000s. “Today is like the personal computer industry in the 80s and 90s where everyone was making gray boxes,” he said.
The 31-year-old tech entrepreneur said he was once Apple’s “biggest fan,” but “overall innovation has only slowed down a lot” in recent years.
Apple’s iPhone was a game changer that ushered in a move to touchscreen-based cell phones and apps that have grown into multi-billion dollar companies. However, some believe that the modern smartphone industry is stagnating, introducing minor updates every year, albeit at higher prices. Large companies are trying to freshen up smartphones with super-fast 5G WiFi and even collapsible displays.
“There is a general feeling, ‘Why should I update my technology?’ because each new generation is similar to the previous one, “added Pei. “In the past people were so optimistic about technology. But now people are indifferent. And there has to be a way to break the cycle.”
Apple declined to comment when contacted by CNBC. Apple has made a number of improvements to the iPhone over the years, including 5G and its powerful new A14 Bionic chip. Other recent product launches include new high-end iPads, colorful iMacs, and lost item trackers called AirTags.
Pei’s second act
Pei was born in Beijing and grew up in Sweden. He recalls that his uncle, who worked for Nokia, gave him old cell phones to play around with. Pei dropped out of college in 2011 to work in the Chinese smartphone industry. Now the entrepreneur is starting from scratch and targeting consumer tech giants like Apple and Samsung.
Pei’s new venture has been puzzling over the past few months, but he tried to generate a hype on Twitter with cryptic posts and raised $ 1.24 million from loyal crowdfunding investors in March.
Pei says he’s frustrated having to download different apps for each of his smart devices. Instead, he wants to build a technological ecosystem, all supported by the same software, and take a sheet out of Apple’s playbook.
“We see a future where technology is everywhere and nowhere,” said Pei. “The first step for us is to create an ecosystem of smart devices that seamlessly connect to each other.”
Uphill battle
However, it won’t be easy. Hardware is a notoriously tricky market.
“The first rule of hardware is that it’s known to be difficult – it’s complex and capital-intensive,” Tom Hulme, general partner at Alphabet’s Venture Capital Arm GV, an investor in nothing, told CNBC.
“If you make a mistake, it can have a devastating impact on the company,” Pei said. “A lot of investors shy away from it and there could therefore be less competition.”
Total sales of true wireless headphones – buds without wires – were 233 million units in 2020, with Apple’s AirPods accounting for nearly a third of the market, according to Counterpoint Research. Counterpoint predicts the market will grow 33% to 310 million units this year and expects Apple’s market share to decrease in competition with new entrants.
Nothing has attracted an impressive number of investors, including Alphabet’s GV, iPod inventor Tony Fadell, Reddit CEO Steve Huffman, and YouTube star Casey Neistat. The company is aiming to raise funds again later this year or early 2022.
“We have enough runway for a couple of years,” he told CNBC. “But I think we want to increase, maybe by the end of the year or the beginning of next year, when our first products are on the market or when our future products gradually become more definitive.”
