Magic Leap pivoted to the enterprise space recently after an extended lukewarm reception by consumers for its $2,300 AR headset. Amid the coronavirus pandemic, company founder and CEO Rony Abovitz then announced layoffs last month that were slated to occur at “every level” of the company. Although those layoffs were allayed by a fresh $350 million funding round at zero hour, Abovitz now says he’s stepping down as CEO.
Abovitz released a statement on the Magic Leap blog explaining the move, saying that a change in his role was “a natural next step” to bringing about the next phase of the company.
“I discussed this with the board and we have agreed that now is the time to bring in a new CEO who can help us to commercialize our focused plan for spatial computing in enterprise. We have been actively recruiting candidates for this role and I look forward to sharing more soon,” Abovitz says.
Abovitz is set to remain as CEO until a new one is confirmed. There’s no word on what role the founder will fill afterwards, however he says it may be at “the board level.”
Here’s Abovitz’s statement in full:
As we’ve shared over the last several weeks, in order to set Magic Leap on a course for success, we have pivoted to focus on delivering a spatial computing platform for enterprise.
We have closed significant new funding and have very positive momentum towards closing key strategic enterprise partnerships.
As the board and I planned the changes we made and what Magic Leap needs for this next focused phase, it became clear to us that a change in my role was a natural next step. I discussed this with the board and we have agreed that now is the time to bring in a new CEO who can help us to commercialize our focused plan for spatial computing in enterprise. We have been actively recruiting candidates for this role and I look forward to sharing more soon.
I have been leading Magic Leap since 2011 (starting in my garage). We have created a new field. A new medium. And together we have defined the future of computing. I am amazed at everything we have built and look forward to everything Magic Leap will create in the decades to come.
I will remain our CEO through the transition and am in discussions with the board with regards to how I will continue to provide strategy and vision from a board level. I remain super excited about Magic Leap’s future and believe deeply in our team and all of their incredible talent and capabilities.
Since its founding in 2011, Magic Leap has amassed over $3 billion in capital from investors such as Google, Saudi Arabia’s Venture Capital Fund, Alibaba, and Axel Springer, making it one of the most well-funded startups in tech history.
Having launched its Magic Leap One (also stylized ‘Magic Leap 1’) in 2018, various reports suggest the device’s sales numbers were far below the company’s expectations as it uncomfortably straddled between developer and consumer.
Before pivoting entirely to appeal to the enterprise space in the near-term, Magic Leap was funding a steady stream of consumer-focused apps for the $2,300 headset, a perplexing move at the time considering the company hadn’t released any timeline on when consumers would expect a cheaper headset.
While the company recently announced a Magic Leap 2 in the works—officially slated to launch sometime in 2021— that too will be targeted at enterprise and prosumers, so it may be some time yet until we see Magic Leap re-enter the consumer space.
