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This blows my mind. Not because of the amounts raised without a single released product: investors have shown a propensity to throw spectacular amounts of money
by liquidise 11y ago
This blows my mind. Not because of the amounts raised without a single released product: investors have shown a propensity to throw spectacular amounts of money at baffling ventures.
Instead, my shock is the implied burn rate of these raises. LinkedIn reports Magic Leap is between 201-500 employees. They are no indications of them mass-producing a product. No sales, and their marketing seems to be exclusively articles about the enormity of their rounds.
How, then, is a company raising 790M 1.5 years after raising 500M? What possible expenditures, without mass product development, sales and marketing, consumes finances at a rate that warrants these raises?
Or, alternatively, maybe the founders and employees simply despise maintaining ownership of their company.
- monk_e_boy 11y agoIt's the total opposite of release early and often.
- rsp1984 11y agoI've asked myself the same thing. I think burn rate alone can't explain it, unless they are paying their employees way, way over market rate. Probably what they are planning to do with the money is a couple of acquisitions. I'd not be surprised.
- jkestner 11y agoLicensed content is really expensive.
- ryanSrich 11y agoAside from the massive research efforts they're undertaking I'm under the impression that they're also manufacturing. I'd guess that comes at a serious cost. I really hope what they have is real, but my mind keeps going back to clinkle. A company that was able to raise a large sum of money with smoke and mirrors. Granted Magic Leap is raising an order of magnitude more than clinkle, but smart people have been fooled before.
- soared 11y agoBuilding your own fab will cost you a lot more than 1.5B!