In what can be seen as a surprising move, Android Creator Andy Rubin who floated Essential smartphone brand last year with the launch of Essential PH-1 is putting the company up for auction and has cancelled the next phone.
Bloomberg report said that it has hired Credit Suisse Group AG to advise on a potential sale and has received interest from at least one suitor. Essential had raised about $300 million from several investors, including Amazon.com Inc., Tencent Holdings Ltd., and Redpoint Ventures and has been valued at $1 billion back in June 2017.
Essential has spent over $100 million on developing its first products which is about a third of the money it raised to build the company. The current discussions are focused on selling the entire company including the patent portfolio, hardware products like the original smartphone, an upcoming smart home device and a camera attachment for the phone. Essential who hired engineers from Google and Apple would also be a part of the deal.
Essential has cancelled the Essential Phone has moved the resources to the smart home device which is scheduled to release next year. However, the company could still go back to phone business and has explored to hire multiple device manufacturers that would take Essential out of the difficult development process.
We always have multiple products in development at the same time and we embrace canceling some in favor of the ones we think will be bigger hits. We are putting all of our efforts towards our future, game-changing products, which include mobile and home products.
— Andy Rubin (@Arubin) May 24, 2018
In a statement, Andy said: “We are not shutting down the company.” “We are putting all of our efforts towards our future, game-changing products, which include mobile and home products”. In an email to Essential employees, he said that the company is “working with bankers to raise money.” He also suggested an acquisition might be part of such discussions to get the needed funds.
While the Essential PH-1 was a decent phone, the camera and high price was a let down back when it was launched, but the company worked and pushed updates that to some extent, has fixed the camera issues and it has also cut down the pricing to $499 which is a fair bargain.