Magic Leap today announced the closure of a massive $793.5 million Series C investment led by Alibaba. The company has kept their supposedly revolutionary AR tech under wraps to the public, but seem to have no trouble convincing investors to pour cash into the company.

Magic Leap’s nearly $800 million Series C investment, announced today on their website, comes just 16 months after an equally impressive $524 million Series B investment back in October 2014. The company is now reportedly valued at $4.5 billion, placing it among the most valuable startups in the world.

Chinese e-commerce company Alibaba led the latest investment, with Google Ventures and Qualcomm Ventures following on from the prior round. Also participating in the investment is Warner Bros., Fidelity Management and Research Company, J.P. Morgan Investment Management, Morgan Stanley Investment Management, funds and accounts advised by T. Rowe Price Associates, Inc., and Wellington Management Company.

Magic Leap says that the new capital will advance the timeline of adoption for the company’s AR technology.

“Here at Magic Leap we are creating a new world where digital and physical realities seamlessly blend together to enable amazing new experiences. This investment will accelerate bringing our new Mixed Reality Lightfield™ experience to everyone,” says Magic Leap CEO Rony Abovitz.

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Although the company has revealed almost no specifics about their technology, the vision seems to be an augmented reality headset with a proprietary light field display which mixes augmented elements into the real world in a more natural way than other display technologies.

Spurious reports from those that have glimpsed the technology say that it’s impressive, but demonstrations have been given with a proof-of-concept system that’s in no way portable and might take a long time to reach the levels of miniaturization needed to fit it into an augmented reality headset.

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Last year MIT Technology Review’s Katherine Bourzac wrote in an article titled Magic Leap Needs to Engineer a Miracle:

Whether Magic Leap can create [a revolutionary AR headset] will depend on whether it can scale up a new chip-making process for silicon photonics—something that’s a big undertaking even for semiconductor giants. The startup’s $592 million [Series B investment] is rich for an early-stage company, but it may need a lot more than that to make the leap to consumer products.

The extra $793.5 million the company picked up today might just be enough to buy the miracle they need. The company is indicating that they’ve crossed the gulf of R&D and are moving toward manufacturing at a large scale. Magic Leap CEO Rony Abovitz tells Fast Company:

We’ve developed what I call a photonics chip, which Includes the design of it, novel materials, even designing the fab that will make it. That’s fundamentally important for us to deliver the experience that’s the natural fit of how the eye-brain system works. We had to build something that accommodates what your eye-brain system is used to getting, which is not available in any off-the-shelf way.

We have achieved mass miniaturization. We’ve gone beyond the computer simulations and one-off prototypes. We’re not on the risk side. We’re on the other side. It’s like talking about making an Intel chip versus actually making them.

Abovitz waxes poetic on the potential of the technology in a new post to the company’s blog.

“We want to make you smarter – not machines. We want you to feel empowered and connected to your friends and family and the world, in a way that feels much more natural than computing today,” he writes. “Today’s internet is one of data and information. Our vision at Magic Leap contemplates a connected, creative, and collective world of human experience.”

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It sounds like the stuff of science fiction, but if the company can deliver the AR headset that sci-fi as dreamed of for years, what Abovitz says could very well become reality.

Concept art from Magic Leap show the sorts of experiences the company wants to make possible.
Concept art from Magic Leap show the sorts of experiences the company wants to make possible.

But with much public grandstanding and little to show, some aren’t convinced. Comparisons to Segway have been lobbed in the company’s direction, the highly-hyped but dreadfully received device that was purported to revolutionize human locomotion.

The most concrete evidence that Magic Leap has revealed thus far is a short video released toward the end of last year which the company says was shot utilizing their technology.

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Ben is the world's most senior professional analyst solely dedicated to the XR industry, having founded Road to VR in 2011—a year before the Oculus Kickstarter sparked a resurgence that led to the modern XR landscape. He has authored more than 3,000 articles chronicling the evolution of the XR industry over more than a decade. With that unique perspective, Ben has been consistently recognized as one of the most influential voices in XR, giving keynotes and joining panel and podcast discussions at key industry events. He is a self-described "journalist and analyst, not evangelist."
  • Bob

    Woah that is some serious investment. Whatever they’re cooking up down there has definitely got the Chinese very interested and if you can get the Chinese interested then you got something big and shiny. Let’s hope the end-result is consumer friendly otherwise no matter how good the technology is you won’t get adoption if the product turns out to be a massive contraption.

  • CarlosTSG

    “Magic Leap says that the new capital will advance the timeline of adoption for the company’s AR technology.” roughly translate to: Yeah we’ve got enough money to last us so we don’t have to bother getting out of bed for another two years.

    • Kyle Nau

      Could be an opportunity since “adoption” of the tech is different than “development” of it. Adoption traditionally means “content”, so if you’re in the field here’s a company with some money to throw at a killer app. Maybe.

  • From research EnGadget did, they have a reverse-endoscope technology that produces high rez visuals using a single moving piece of fiber optics, which paints your eyeball with an rapidly scanning image, kinda like an electron gun in an old glass TV. It should make for a remarkably crisp image from a very tiny display device. –BUT– they don’t have any magical technology that lets them render high-rez images out of thin air. This would still have to be driven by a cellphone or computer… so that whale isn’t going to happen anytime soon. Also they don’t have an super-duper environmental scanning software or hardware, so they can’t track your head any better then a Gear VR or DK1, nor can they do real-time occlusion. So these floating images can’t be blocked by the environment, nor be tracked in space with much accuracy. Whatever ACTUAL tech they are selling isn’t much more then a *slightly* better version of Google Glass. Nothing these guys have access to suggests they can do any of the stuff they claim in their many, to-good-to-be-true videos.

    Secrecy in the tech community almost never ends with a happy surprise. I fear this will be known in the future as the biggest tech scam of the early 21st century.

    • BlackMage

      Well, maybe they’ll also sell the display technology? If it actually produces a wonderful wide angled image that nobody else can do, it could probably replace the display on the Hololens where all the room scanning stuff apparently works quite well.

  • Sky Castle

    I’m not excited about AR as I am for VR. I find AR to be more practical
    for real world uses than gaming. It would be cool to have a virtual
    desktop and surf the web or check emails, etc. but for gaming I really
    don’t want to see robots or any digital objects overlaying our boring
    world. I’d much rather be completely immersed in a virtual world that
    can only be provided by VR.

    • JeanClaude

      I agree with you, but I’d say that the display tech advances for AR, will probably end up revolutionizing VR too.

      If a proper light field display that can fit your entire FOV is created, it can easily be used for VR too, and probably will work much much better then current VR, while also possibly being much lighter and smaller.

  • Charles Evans

    Not bad at all, especially considering that Magic Leap is based in Fort Lauderdale, a scant 20 miles north of Miami.

  • Firestorm185

    Accel World. Calling it now.