Early on I / we all hoped that sales through top end surround sound nuts like you great guys in QQ would have a multiplication effect and others from the general community would take your lead and buy our stuff. That really has not happened and it seems you guys tend to keep your little stash of special gear secret!
Actually the opposite is true, I tell all my friends about the S.M. and have demoed it to everyone I can who comes over to hear my system. And all of them love the sound when I play them a few good sample CD's through it.
Unfortunately most people who hear it are not willing to shell out the money to purchase all the analog equipment to setup a system. A lot of them really don't even have a decent stereo, let alone the money need to setup analog 4 channel.
Where I do see a possible potential market for expansion ( for hardware S.M. ) is with people who have setup home theatre equipment, and already invested the money in MC sound. They already have everything they need to make it work with one exception, they need to be able to connect the S.M. to their receivers, but they don't have analog inputs for 5.1 anymore. I haven't tried it, since we don't have a way to connect it, but the S.M. might even sound good on the lowly MC soundbars that have HDMI input.
Another thing I think that is hurting sales is you have to have inventory in stock for people to make the purchase when they are ready to buy. Most people aren't going to wait for months on end for another run or pre-pay and wait forever for product to materialize. They will move on to something else that has their attention and spend their money on that. Also it helps if your product can be found in normal sales channels where people buy. If someone buys on Amazon, that is the first place they are going to search for your product when they hear about it. Since they are not familiar with Involve, they will feel comfortable making the purchase on Amazon.
There are some "niche" audio products that are doing really well and have really seen growth in sales. Schiit audio is great example. I have bought several of their products and they have a high customer satisfaction and loyalty. Maybe a partnership with a company like that would be useful, since they manufacture a lot of their components. The partner would handle manufacturing and distribution for you, and be able to do larger runs so that you would have enough inventory to eliminate wait times for product. This would give you more time to focus on product development, design, and possibly getting your encoder into receivers, etc.
Another idea ( maybe the best one I have ) would be if you could license ( or partner with ) the encoder to be installed in a Blu ray/DVD/CD player so that it would have an option to play a CD with Involve S.M. turned on and send it out the HDMI? The encoder option could be enabled (button on player and/or remote) on any stereo audio source such as a DVD with stereo only, or even files played back from a USB drive attached to the player. They have already paid the license fee for HDMI. If they are not interested in adding S.M. technology to their player, maybe they would manufacture a player for you to sell. You could reduce the cost by not even having a disc drive ( BR/DVD/CD ). It could just be a media player with USB ports that you connect a HD/USB drive and play media directly from the drive. Something like a MIbox or network file player combined with S.M. Play a stereo audio file and convert to Quad, 5.1, etc using S.M. builti in. All of the media players and Blu ray players out there have HDMI. It seems you could find one that would be able to build a S.M. player for you to sell alone or as a partnership.
As alway, I love the Surround Master and wish Involve the best of luck with the future of the product, whatever that may be.