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Magic Leap has apparently raised another $350M (techcrunch.com)
63 points by pseudolus 11 days ago | hide | past | web | favorite | 53 comments

> Magic Leap has reportedly received a $350 million lifeline, a month after slashing 1,000 jobs and dropping its consumer business.

What the heck do a thousand people do at Magic Leap? That’s an insane headcount for a company without a sales or consumer support team. And that’s just the jobs they cut!

To be fair, none of these things are trivial: - Creating an AR operating system - Developing and manufacturing AR hardware - Creating an SDK and a developer ecosystem for the hardware and software - Creating a platform for selling AR apps, and selling B2B - Doing R&D and filing patents for new AR tech

I don't think they are one of those companies where I wonder why they need people. They are doing something really hard. Maybe too hard.

prolly don’t need an os. or a platform.

I'd imagine it's some kind of RTOS to handle the time sensitive parts of the graphics / AR stuff. Probably not custom kernel but they'd have to develop a lot of stuff around it.

As for the sales platform, why wouldn't they develop it? To attract developers they need to make it easy for users to buy the products those developers would be create. It's not like the early 2000's where you could launch a console without an online store, it's pretty much mandatory these days because both developers/publishers and consumers expect it to be there.

Iirc it was close to 40-50% of their staff.

They have sales and customer support. They also don't have a (sizable) network of 3rd party developers yet, and had a lot of staff internally working on content for the platform.

In addition to the fact they design their own hardware, they manufacture and test it themselves too so they have supply chain/logistics to worry about, QA and test development, factory workers/technicians, etc.

Of all the "how does X have so many people?!" ML makes the most sense. It's hardware, not easyware.

They were reportedly doing crazy complicated things to develop the product. Including running their own silicon fab at their office in Florida.

This is the startup equivalent of "too big to fail."

They have capitalized so much that they need to capitalize even more to make their previous capitalization make sense.

I doubt if we investors who funded earlier wil want to continue doing that. At some point they have to decide to cut their losses. Like wework

Only if the product begins to feel infeasible. But as computing hardware continues to shrink and ML improves their processes, I'm willing to bet a lot of investors see success as an eventuality.

They must have something very valuable in the defense space.

Pretty much this. There's something else at play here given they haven't been left to crash and burn, and patents either resold or licensing deals inked. There's likely something actively being used or funded that can't be left to fall over as part of a wider scope of work or project. Given it's JPMC, only the board will "officially" be privy to it.

Nobody throws money into the fire unless they're trying to keep something warm.

Once that project ceases, those employees will be cut and the resulting tech or teams will be acqui-hired by an R&D arm or contractor who'll continue to pick at the bones of it.

JPMC is in the money business. Not tech. They're riding this beater until it finally conks out.

If you work for MagicLeap, get your CV out there.

Magic Leap has already signed over its patents to JP Morgan back in Nov 2019. Are those still acquirable assets in the event of an acquisition?

I read about this previously.

"Signed over" is too strong, it's more like their loan covenants mention the patents, but if you pay the loan, it doesn't matter.

They pledged the patents as collateral. So if they (or their acquirer) don't repay the loan, JP Morgan is entitled to keep the patents.

> Whatever the case, the company is withdrawing the WARN notice (a 60-day notification for large-scale layoffs) sent to staff in late April. The move represents an apparent reversal of the massive layoff round it previously announced.

What does that mean exactly? Were the people laid off given their jobs back? What does "withdrawing" a WARN notice even mean?

Is most cases, large companies need to give a 60 day notification if they plan a sizable layoff. So perhaps they were just given the notification but not laid off yet. But many employers will "pay in lieu of notice" and lay them off immediately with the 60 days of pay.


I have got to see this demo

Yay- hopefully the landlords can get paid now - https://www.geekwire.com/2020/heavily-funded-magic-leap-sued...

>“We are making very good progress in our healthcare, enterprise, and defense deals,” Abovitz writes. “As these deals close, we will be able to announce them.”

Wouldn't surprise me if they sold lemons at such absurd contract prices that it made their investors giggle.

They've also made "very good progress" in AR for the past 5 years. I hope the deals won't turn out like this:


As funny as that is, this was recommended to me next:


Id buy that.

This video is excellent and a great comparison of expectations vs reality.

> Magic Leap cited COVID-19 as a key reason for April’s news.


A signal we'll be seeing something in this space from Apple soon...

$3 billion total...

That’s enough money to give $100,000 to 30,000 startups.

I mean that’s simple math. But $100K won’t pay the fully allocated cost of one senior developer for a year in a medium COL area.

what exactly is a startup to you?

(Assure you a $100k to a startup is not the same as $100k to Google.)

Whatever $100K is to someone, I know that what I said about salary is true. I’ve worked for small VC back companies with less than $10 million in revenue. $100K wouldn’t have made a difference either way.

Here’s small scale examples of $100k making a massive difference:


That said, $100k is not a salary and if someone needs $100k+ salary to do a startup for a year, startups are the wrong choice.

Yes. That’s fine if you’re not adulting - with kids, bills, the need to pay health insurance etc.

If I were under 26, no responsibilities and could get on my parents insurance sure.

This has nothing to do with age, being an adult, being in US, etc.; sure, you have a set of assumptions, but they apply at best to you, not the world.

“Peter Thiel launched a program that awards $100,000 to promising young entrepreneurs who are willing to drop out of college”

Your example explicitly mentions age as one of the requirements.

which is not the kind of thing startups of that size worry about... yc gives $150k...

I don’t think the money is that relevant when it’s that small. It’s more about the connections. Or is that what you were saying?

This might sound a bit cynical, but companies like Magic Leap (and WeWork, for that matter) is why I find myself so fatigued with my "startup dreams" -- it's clear that VCs are an echo chamber and that getting in those circles is much more important than ideas, execution, or even profitability. During my brief stint into hardware startups[1], I could barely find people to answer my emails.

Magic Leap is literally garbage (it's downright embarassing when compared to Oculus or HoloLens), and yet they just raised another $350M. It simply boggles the mind.

[1] https://www.pcgamer.com/introducing-gameref-the-anti-cheat-h...

Without knowing the terms of the fundraising, I wouldn't assume that the founders are in a position of power and influence.

Products never matter. It's all about execution and convincing others to buy into your execution plan

that doesn't seem to describe ML either

I like the idea of micro-saas's better than all these unicorns. I love stories from Indiehackers about companies making 5-20k/month w/ 1-2 devs and that's all they need. It pays the bills, gives some freedom to do what they want etc....

Opposed to these behemoth's who really only have a hope and a prayer that they're a bit enough disruption that they will pay off. Like Uber, Groupon, Living Social, WeWork, AirBNB, etc... I think they all could be more valuable had they operated more lean, w/ a solid strategy to monetize early and less focus on VC money and raising seed rounds.

TLDR; I like the little guy stories, and am also fatigued of the giant so-called unicorn stories.

beyond parody.

I can't believe seemingly smart people still think consumers want vr

I’ve been skeptical of VR myself, but Oculus Quest feels like it is going to be a hit.

I don’t have data but the pulse I’m reading is a very high consumer satisfaction and it continues to sell out.

To be fair though, they have a lot of cash for PR to manage people's perception of 'pulse'. That is PR job after all.

Magic leap is AR which consumers and businesses definitely don't want.

VR has nothing to do with Magic Leap or even AR. VR probably has a consumer case (consuming media) but no real business use case until after the consumer case has been made.

I was of the same opinion until I tried the latest Vive headset. I'm ready for VR. GTA 6 with 360 treadmill, VR and Unreal Engine 5 level graphics will be the next level.

I was skeptical too, but Half Life: Alyx sold gangbusters (as was the Valve Index, at a $1,000 price point to boot).

There is clearly demand, but I think we've learned that it's a niche market.

Did you actually play Alyx though? It’s amazing. I think VR will dominate both the consumer and commercial markets as it matures. It will be a defining technology of our lives.

No, but every comment I hear says exactly the same as yours - that it’s phenomenal.

It’s definitely the exception, though. Nothing else comes close, so I’m having difficulty justifying shelling out $1000 on something for a single game, no matter how exceptional.

>I can't believe seemingly smart people still think consumers want vr

If Henry Ford asked you what you wanted in 1890s, it sounds like you would have said "a faster horse"

I don’t know why you’re down voted — until we fully appreciate how the sense of smell triggers stronger memories than spatial representations of place, VR will continue it’s glorious march off the cliff.

Perhaps this is why: https://roadtovrlive-5ea0.kxcdn.com/wp-content/uploads/2020/...

VR is growing slowly and steadily. That's not counting offerings like the Oculus Quest.

Also Magic Leap is AR, not VR.

Thanks for the data. I don’t doubt units will be sold - but when viewed as the search for the next personal computer, these embodiments fall woefully short.

There are very interesting use cases in ‘perspective collaboration’ - as in, ‘do you see what I see?’ Other stellar use cases are how you can prepare for new spaces and new environments. These use cases will sell many units (along with the de facto: gaming).

All this said, I feel the parent comment is correct. The way these companies are approaching the ‘why’ is very ‘it’s like you’re there’ ; ‘look at how connected you are’ ; and some variant.

All is not lost though. There are incredible changes in society if these embodiments (VR, AR, MR, XR) are seen as one of the many user interfaces for the next kind of personal computer. As in, if you change the basic command structure between user and computer - then the next generation PC can take shape.

[Edited: clarity and still terrible]

Honestly, Snap isn’t too far off, but the valley is uncanny.

the technology is really wonderful and given this current crisis, things which digitizes us becomes even more important. we should try and go for mind uploading soon.

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