There is a risk that the Company may fail to increase the number of paid customers as there are indirect competitors such as Apple Music and Spotify. This risk is dependent of the ability to acquire user by educating him of what is hi-res audio and why VOX is a unique service.
We are using a SAFE agreement for this offering. The Company may never receive a future equity financing or elect to convert the Securities upon such future financing. In addition, the Company may never undergo a liquidity event such as a sale of the Company or an IPO. If neither the conversion of the Securities nor a liquidity event occurs, the Purchasers could be left holding the Securities in perpetuity. The Securities have numerous transfer restrictions and will likely be highly illiquid, with no secondary market on which to sell them. The Securities are not equity interests, have no ownership rights, have no rights to the Company’s assets or profits and have no voting rights or ability to direct the Company or its actions.
One of VOX's features is the ability to upload any audio file to their personal cloud storage - there potentially may be a risk of having issues with Music Labels. Legally there is no violation of Intellectual Property rights from the Company's side, however, uploaded music will be streamed and this could cause issues regarding legal rights on music compositions.
Company's assumption is that money raised would mostly be invested in marketing to increase volume of users and, as a result, sales. There is a risk that marketing wouldn't be as much effective as we assume.
There is a risk that Apple may revoke VOX app from the Apple Store because of music streaming issues.
Previously we had two separate products - VOX player and LOOP cloud storage. Now we are on the way to launch new product VOX Premium (combination of two previous products in one). There is a risk that there will be huge % of current customers who will be unsatisfied with this innovation.
The company is reliant on a small management team, which we must retain to ensure continued growth and productivity.
We have numerous Convertible Notes which we are planning to convert during this Offering. This could affect an investor's investment in this campaign.
We rely on various intellectual property rights in order to operate our business.
Our intellectual property rights, including registered trademarks, may not be sufficiently broad or otherwise may not provide us a significant competitive advantage. In addition, the steps that we have taken to maintain and protect our intellectual property may not prevent it from being challenged, invalidated, circumvented or designed-around, particularly in countries where intellectual property rights are not highly developed or protected. In some circumstances, enforcement may not be available to us because an infringer has a dominant intellectual property position or for other business reasons. Any failure by the Company to obtain or maintain intellectual property rights that convey competitive advantage, adequately protect our intellectual property or detect or prevent circumvention or unauthorized use of such property, could adversely impact our competitive position and results of operations. We also rely on nondisclosure and noncompetition agreements with vendors, consultants and other parties to protect, in part, trade secrets and other proprietary rights. There can be no assurance that these agreements will adequately protect our trade secrets and other proprietary rights and will not be breached, that we will have adequate remedies for any breach, that others will not independently develop substantially equivalent proprietary information or that third parties will not otherwise gain access to our trade secrets or other proprietary rights. As we expand our business, protecting our intellectual property will become increasingly important. The protective steps we have taken may be inadequate to deter our competitors from using our proprietary information. In order to protect or enforce our intellectual property rights, we may be required to initiate litigation against third parties, such as infringement lawsuits. Also, these third parties may assert claims against us with or without provocation. These lawsuits could be expensive, take significant time and could divert management’s attention from other business concerns. The law relating to the scope and validity of claims in the technology field in which we operate is still evolving and, consequently, intellectual property positions in our industry are generally uncertain. We cannot assure you that we will prevail in any of these potential suits or that the damages or other remedies awarded, if any, would be commercially valuable.