Almost a billion dollars raised and no product! Sounds like a normal startup, right? Not exactly.
Quite simply, they have patents. As of today, they have filed for 166 of them, and they don’t show any signs of slowing down.
Magic Leap is a company in a quandary. There are massive players out there (Alphabet, Samsung and Facebook among them) who have seemingly limitless coffers who are also in the Virtual Reality space. Those companies not only have financial resources, they have years of research, development teams and partnerships with manufacturers, advertisers and retailers so that when they do hit upon their product, they will be able to come to market with it immediately.
Furthermore, in the case of Facebook and Alphabet, they can control the advertising experience that people see regarding VR companies.
Magic Leap needs to have something really special to overcome that handicap.
And from what I can see, they do.
For one, they have Neal Stephenson as their Chief Futurist. Hiring this man is a coup – it’s like hiring Isaac Asimov in the 1950s or HG Wells in the 1900’s – or, for the non science-minded, it’s like capturing Walt Disney in the 40’s and asking him “What’s possible?
Next, they must know that the future of mainstream VR is a wireless, glasses-less, HUD-like enhancement to everyday life. I surmise that they are going along this path based on their patent filings. That is a very good sign to me.
This puts them immediately apart from Alphabet, Facebook and the rest. (It isn’t that those companies aren’t going that way too, but rather that they won’t be so quick to iterate to it, as a “startup” company like Magic Leap must do to survive.)
For those reasons, I believe Magic Leap is indeed worth the valuation their large investment rounds signify.
Originally Posted: https://www.quora.com/Why-is-Magic-Leap-worth-so-much-What-strategically-defensible-assets-do-they-have
Originally Posted On: 2016-02-16