Bankruptcy for Genesis
The bankruptcy petition was filed in late November in Colorado, the company's base of operations, according to minority shareholder Mark Schifter, founding partner of Perpetual Technologies. Schifter hopes to resurrect the brandname and bring some of Genesis' products back to market once the legal problems are sorted out, he mentioned in a telephone discussion December 20.
The brainchild of designer Arnie Nudell, Genesis Technologies produced a number of market-leading products, including several that attained Stereophile "Recommended Component" status. Capable of enormous sound-pressure levels and life-like dynamics, Genesis loudspeakers were notable for their beautiful finishes, often in exotic hardwoods. Nudell's Genesis designs evolved from work he did in the 1970s and early '80s with Infinity, whose Infinity Reference System (IRS) once dominated the ultra high-end loudspeaker market. Genesis also pioneered the benefits of digital reclocking and upsampling with its Digital Lens, another breakthrough product, which helped make CDs sound more musical.
Technical prowess, unfortunately, doesn't always translate to business success. Schifter said he was "incredibly disappointed" that Genesis Technologies had been unable to get back on track. "The last dinner I had with Arnie, where we discussed the bankruptcy, was one of the saddest nights of my life," he confessed.
Our anonymous source believes that Genesis Technology will be able to discharge its debt in bankruptcy court. "The name still has market value," he mentioned. "I understand that a financier plans to buy the name, logo, designs, and other intellectual property and revive the brand, similar to what happened with Sonic Frontiers."
Schifter confirms that prediction, revealing that he may be the buyer: "At this point I believe I have a 99% chance of acquiring the intellectual property while discharging the debt. If all goes well, we will bring Genesis Technologies, LLC back as Genesis Technologies, Inc., with fewer SKUs at much lower prices." Schifter has already researched having Genesis products built in China, where labor costs are far lower than they are in the US.
He intends to pass the savings on to customers. "We want to offer the 350 Special Edition at $19,900 per pair, and the 501 at $6990," Schifter stated. The 350 previously sold for $35,000 per pair; the 501 for $13,000. Such drastic price cuts might jump-start business for the next-generation Genesis. Schifter also expects to offer the 928 powered subwoofer for around $1200 retail, a substantial discount from its former price of $1700. Drivers and components will all be sourced from previous vendors, with the only difference being that assembly will take place in China.
A revived Genesis Technologies will support a small network of dealers, probably no more than a half-dozen in the United States. The products will also be sold over the Internet. "You can't ignore the online market anymore," Schifter stated.
Independent contract manufacturer Cullen Circuits, which previously assisted in the manufacturing and repair of some Genesis products, will continue to provide non-warranty repairs for Genesis electronics only (not loudspeakers), according to owner Rick Cullen. Customers may contact him by email at email@example.com.