Magic Leap, the multi-billion dollar AR startup, could be exploring the possibility of a sale, a Bloomberg report maintains, citing people familiar with the matter. Other options reportedly under consideration are potential partnerships and a stake sale.

The Plantation, Florida-based company has raised $2.6 billion since its initial Series A financing in 2014, garnering cash from the likes of Google, Alibaba, Qualcomm, and Andreessen Horowitz over the years. The company’s deep pockets funded the release of Magic Leap 1, an AR headset targeted at developers, enterprise, and anyone with $2,300 to spare.

Bloomberg maintains the company has valued itself at “more than $10 billion if it pursues a sale,” its sources say, noting that the company has contacted an adviser to consider strategic options.

A meeting was also allegedly held between Facebook and Magic Leap, however Facebook was uninterested in acquiring Magic Leap at the time.

When asked for whether the company was pursuing a sale or not via Twitter, Magic Leap Founder & CEO Rony Abovitz declined to answer.

https://twitter.com/rabovitz/status/1237986910729113600

In the same breath, Abovitz isn’t shying away from hyping the company’s forthcoming Magic Leap 2 headset, which he says is nearing release to select partners this year. A wider launch is said to come a some point in 2021.

Further underlining the company’s resolve, Abovitz even goes as far to reveal that Magic Leap 3 is currently in its R&D phase—an unorthodox strategy to be sure, talking about its third device even before getting number two out the door; companies typically talk about one product generation at a time, but then again, Magic Leap clearly isn’t like other companies.

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If Magic Leap is indeed looking for a parachute amid reportedly slumping sales of its $2,300 AR headset, it comes as no surprise. The company struck an all too hopeful tone with when it first released its ‘Just another day in the office at Magic Leap’ video in 2015 (retroactively renamed ‘Original Concept Video’) which painted a rosy picture of the near future of the company’s then mysterious AR headset.

Upon launch of Magic Leap One (now Magic Leap 1 – don’t ask) in 2018, the headset saw a tepid release, with Oculus founder Palmer Luckey serving up a scathing review of the headset, criticizing it for its HoloLens-adjacent FOV and function, and concluding that while overall a solid device, it simply didn’t deliver on the hype.

In the company’s defense, Magic Leap has been spinning its fair share of plates. It’s built a real, live, totally-not-vaporware device, and has funded the creation of apps for years targeted both at enterprise and consumer segments—despite it in no way being accessible to consumers. It’s created its own OS, SDKs and everything else needed to get the product off the ground and into the hands of developers. Making what must have been substantial investments in R&D, premium content and developer tools isn’t anything to sneeze at, although it’s clear the company hasn’t seen the return on investment. And it probably won’t until it can at least replicate the success of Microsoft’s purely enterprise-focused HoloLens headsets.

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  • ssfasd

    10 billion…. what idiots. Here we scammed everyone out of 2.8 billion but now we want 7 more for to pass off our failed project.
    I know im being harsh with the term failed and scam, so dont look into it too much its personal opinion.

    • Xron

      Well, they really did it with the clips they showed us
      with big whale splashing before kids eyes and little elephant in hand… what a bummer.
      Wondering how did they decide their price oO

    • Jerald Doerr

      Right! I think they need the 7+ to pay off investors they scammed.

      • silvaring

        And any impending lawsuits…

  • Sdasds

    Remember the whale.

  • The problem is, they’re playing in too exclusive of a segment to attract much developer mindshare. The Hololens sharing it’s platform with Windows Mixed Reality opens it up to a much more accessible and wider development ecosystem. And Microsoft has been around long enough that, if you’re building a business on an XR software product, that they’ll be around and you’ll have hardware choices.

  • Jetson

    Oculus, Valve and Microsoft are currently the only ones on track. To try to profile yourself as a Rolls Roys in the VR/AR medium is a receipe for disaster in this field. Snobism and an high and mighty Abovitz attitude will burn this companies investment money without anything substantial to offer for (wo)mankind. A Magic Leap is far from enchanting but closer to a leap in the abyss. It also looks pretty idiot.

  • NooYawker

    Milked it for all he could, now he’s selling. What a genius scam.

  • impurekind

    Shock–not.

  • aasdfa

    i cant wait for ml to fall through. I hate what it will do to XR investors but man i hate when people try to scam society and i feel like thats what ml has tried to do. I feel bad for the investors that were easily persuaded and believed their crap.

  • JesuSaveSouls

    I’ll give you ten bucks for the whole company.

  • I wonder how well is doing Magic Leap 4…

  • mfx

    10 Billion for this scam, what a joke. This guy should be in jail first of all.

    When you just see how they accomplished nothing, sold nothing, and their brand sound likes theranos to everyone, they are worth the price of their office chairs, nothing more.

    • guest

      It looks like the tweet is saying 4.2 is his exit plan.

  • Kaput

    nreal product seems to be better
    https://www.nreal.ai/
    waveguide optics
    Looks like sunglasses
    499 $
    88 grams
    connects to SD855 based android phone in ur pockets usb-c
    soon to be released
    I cant believe it
    buts its true

    • mfx

      Absolutely not waveguide, it’s birdbath.

  • Hivemind9000

    I find it amusing that people instantly call it a “scam” when a product fails to meet its (admittedly overhyped) market expectations. The only people scammed here were sophisticated institutional investors, who should have had an inkling of what was at stake. From everything I’ve read, the biggest failing was the miniaturization of the technology they originally demoed to said investors. Also, not realizing that failure and proceeding with a product that was seemingly targeted at consumers, but really should have been (at this stage – due to price and use-cases) a solely enterprise-targeted product.

    Rony Abovitz really has over-promised and under-delivered, and sucked a whole lot of cash out of the available XR funding pool – so maybe the vitriol is justified. Not a scam though – just a sham. :-)

    • silvaring

      Well said. Some people might interpret it as a scam, since he could have misled them during each successive funding round. Perhaps the engineers could chime in…