KSA Invests $590 Million in Magic Leap's VR Headset
The US-based company is developing a virtual reality headset to rival Apple's Vision Pro goggles.
Saudi Arabia's sovereign wealth fund has made a substantial investment of over $590 million into Magic Leap, a US-based company developing a virtual reality headset to rival Apple's Vision Pro goggles.[1]
The funding comes from the Public Investment Fund (PIF), which positions Magic Leap in direct competition with Apple and Meta, the owner of Facebook, in the race to compete in the virtual and augmented reality gadget market.
As Apple prepares to launch its highly anticipated $3,499 Vision Pro headset, Magic Leap aims to position itself as a contender in the industry.
Based in Florida, Magic Leap previously introduced advanced augmented reality glasses in 2015 but faced limited commercial success.
The recent injection of funds brings Magic Leap's total raised capital to over $4.5 billion, highlighting the significant financial backing behind the venture.
Filings from Magic Leap's European division revealed that the company issued an additional $590 million of convertible debt to the Public Investment Fund in exchange for cash in November.
Founded by entrepreneur Rony Abovitz in 2010, Magic Leap had secured funding from notable investors such as Google and AT&T.
However, despite these investments, the company has never turned a profit.
Abovitz stepped down in 2020, and subsequent leadership changes saw Peggy Johnson replaced by Ross Rosenburg, a former executive at Bain Capital.
Initially targeting consumers with its $3,299 headset, Magic Leap has shifted its focus towards corporate customers.
Additionally, the company has explored licensing its intellectual property to other tech giants, engaging in talks with Meta in the past year for potential collaboration on design utilization.The two slight advantages that Magic Leap has over its main rival Apple Vision Pro, are that it is slightly cheaper (200 USD cheaper) and that it targets corporations rather than individuals.
However, Apple has the advantage of its loyal customers who have been waiting for this highly anticipated Vision Pro for some time.
The two products are similar in prioritizing the comfort-centric design of the headset, the decentralization of the processing unit, the intuitive controls, and the emphasis on clear, immersive display technology.