Augmented Reality Pioneer ODG Collapses Ahead of Patent Fire Sale
Once a high-flying augmented reality startup with millions in funding, Osterhout Design Group burns through its cash and shrinks to a skeleton crew as potential acquisitions fall through.
Augmented reality pioneer Osterhout Design Group collapses just two years after raising $58 million and showcasing ambitious consumer smart glasses at CES 2017. Founder Ralph Osterhout aims to transition the San Francisco company from its military contractor roots into a mainstream AR powerhouse, but the startup quickly burns through its massive funding and stops paying employees.
The company initially finds success with its enterprise-focused R-7 glasses, but its attempts to juggle multiple product lines and break into the consumer market drain its financial resources. ODG even rejects a buyout offer from a large Chinese firm that exceeds its $258 million valuation, a decision that ultimately backfires as the startup's financial situation deteriorates rapidly.
Today, ODG operates with only a skeleton crew as it prepares to sell off its valuable patents to pay back creditors. Potential rescue acquisitions from major tech players like Facebook and Magic Leap fall through, leaving the once-high-flying startup to fade away as a cautionary tale in the highly competitive augmented reality industry.