Magic Leap names EDBI, Temasek as investors in US$502m funding round

Singapore

A MIXED and augmented reality startup has attracted a new US$502 million cash infusion led by Singapore's investment firm Temasek Holdings.

The Florida-headquartered startup Magic Leap also named EDBI, the venture capital arm of Singapore's Economic Development Board, Brazil's Grupo Globo and Janus Henderson Investors as strategic and financial investors behind the US$502 million Series D equity funding.

Also participating in this new funding round are existing investors in the startup: Alibaba Group, Fidelity Management and Research Co, Google LLC, JP Morgan Investment Management, and T Rowe Price, Inc.

Allen & Company LLC served as exclusive financial advisor to Magic Leap in connection with the transaction.

Founded in 2011, Magic Leap has reportedly raised over US$1.9 billion in equity funding so far.

Magic Leap's chief executive Rony Abovitz and its founding management team have extensive experience in software and hardware engineering, and media content delivery with global brands like Beats Music, Motorola, Samsung, HP, National Geographic Channel and Vevo.

Seven years into its inception, Magic Leap is close to launching its first product. The Business Times understands that with EDBI and Temasek now on board as equity investors, Singapore may possibly feature on the global roadmap for Magic Leap's imminent product launch.

The startup has not disclosed exactly how the product would work or its launch date. But one report described its first product as a headset device that would simulate 3D images and superimpose them in the real world, offering users a "mixed reality" experience.

For now, reported estimates put the price of the product at between US$1,500 and US$2,000.

Mr Abovitz has reportedly said Magic Leap's proprietary system would project patterns of light into the eye, letting people receive virtual objects similarly to the way they naturally see real things, without the nausea of some existing virtual reality experiences.

Magic Leap's product is likely to compete head-to-head with other similar offerings that have been launched or are being launched by bigger boys in the technology play.

Microsoft at a consumer electronics trade fair in Germany in September indicated the intent to include "Windows Mixed Reality" in its upcoming Windows 10 Fall Creators Update. Four of its mixed reality working partners had displayed headsets at the same trade fair in Berlin. Facebook Inc and HTC have also launched their virtual reality headsets, Oculus Rift and HTC Vive.

Market intelligence for info-communication and consumer technology markets, International Data Corporation, has forecasted that worldwide revenues for augmented reality and virtual reality products will more than double over each of the next four years. Total spending on these products is expected to hit US$215 billion in 2021, up from US$11.4 billion this year.