Can one brand Finnish them off? Sanjoy Narayan on Valco’s cult headphones
The flagship noise-cancelling model, the VMK20, is almost half the price of anything comparable. The company has a unique approach to marketing too.
In a recent post on Facebook, Valco, the fledgeling Finnish brand that makes noise-cancelling headphones, had a video of Bhikari Bal, the late bhajan singer from Odisha, also known as the Bhajan Samrat. The clip is of Bhikari Bal singing an ode to Lord Jagannath, with the words, “Kaliaa Re Kaalia” but the text of the post (translated from the Finnish) says this: “The executives of a big multinational headphones company are drinking champagne somewhere in Tokyo or New York. When you buy Valco’s noise-cancelling headphones, we use that money to buy beer in Finland.”
The humour will elude you if you’re not familiar with the language and with the twisted sardonic jokes that make a Finn grin. The word Kaliaa (spelt Kalja in Finnish) is the colloquial term for beer.
Last year, when a batch of Valco’s headphones turned out to be defective on account of faulty memory chips, they released a video where a man opens up a headphone only to find a tiny dead fish inside. Instead of papering over the problem that the company was facing, it turned it into a joke. It’s another matter that every defective pair of headphones that the company sold was taken back and either replaced or repaired free of cost.
If these seem gimmicky things that the brand does, the absolutely serious thing about Valco is the quality of the headphones they make. And the manner in which they have tried to take on giant brands such as Sony, Bose, and Sennheiser. With a mere 10-12 employees, most of them working remotely from little towns in far-flung corners of Finland, Valco can kind of remind you of the feisty Gauls that take on the Romans in the Asterix comic books.
Valco’s flagship model is the VMK20, which at a retail price of €169 is almost half the price of anything of comparable quality that you can get from big brands. The company manages to sell at a low price because it makes its headphones in China; it doesn’t spend big bucks on advertising, using Facebook, Youtube, and other social media platforms to grow brand awareness. All headphones are directly marketed to customers, eliminating commissions to retail networks.
Valco’s founders include Henri Heikkinen, 38, and Jani Rajaniemi, 49. Says Heikkinen: “Valco was born from frustration with our current jobs that were soulless and boring. We both have significant experience in entrepreneurship, marketing and all relevant fields.” Heikkinen and Rajaniemi are a sort of Yin and Yang combo at Valco. Or, in keeping with their take-on-the titans approach, an Obelix-Asterix duo. Heikkinen is a computer science engineer, and extrovert responsible for Valco’s quirkily humour-laced manuals, and marketing. Rajaniemi, a PhD in administrative sciences, is an introvert and antisocial hermit who lives in a remote cabin and is responsible for purchasing, tax planning and contracts.
The duo began the company in 2018 by using their credit cards to fund a seed capital of €2500, and a few years later, crowd-sourced €100,000. The headphones business began on a whim but soon, despite being confined mainly to the Finnish and German markets, sales shot through the roof. Last year, revenues touched €2.4 million with the company reinvesting much of what they earned.
In Finland (which accounts for 60-70% of annual revenues) and Germany (30-40%), Valco is still a cult brand among serious audiophiles. But things could change. The company has also launched in-ear noise-cancelling buds and a hardy blue-tooth speaker. But the VMK20 remains its flagship. This summer, a new variant in white dropped (the older ones are black or grey) and, according to Heikkinen, they could start distributing the brand through bigger retail chains – more for brand building purposes than big sales. The idea is to keep prices down and, ostensibly, take strategic sniper shots at the biggies. Just like the characters in that little indomitable Gaulish village.