SoftBank eschews $100 million investment in Andy Rubin’s ‘Essential’ smartphone company
Money from tech-focused ‘Vision Fund’ is flowing, but not to Andy Rubin this time.
After first hearing about Andy Rubin’s upcoming phone company called “Essential” back in January, information is being revealed today that SoftBank has pulled back on an expected $100 million investment in the company. SoftBank CEO Masayoshi Son has decided to put the brakes on the investment that would have valued Essential at $1 billion.
That would have been putting a considerable amount of faith in a company that has yet to announce or even tease a product, though according to sources of The Wall Street Journal, Essential could be launching a phone as early as this Spring. WSJ claims Essential’s phone would be “high-end” and of course running Android, with tie-ins to home automation and artificial intelligence. It would be priced similarly to Samsung’s Galaxy S line.
Essential still plans to launch a high-end phone this year.
As we all know, the high-end smartphone market is a tough one to crack today, and a whole lot has to go right in order to make a splash. The reported investment would have involved more than just money, though, as SoftBank would have also used its large marketing and carrier power in Japan to help launch the phone there.
Sources indicate that the deal between Essential and SoftBank was nearly finalized after months of talks, only to be called off in the late stages by Son. Speculation is that Son had a last-minute change of heart on the deal following Apple’s $1 billion commitment to his “Vision Fund” venture capital fund. Though Apple itself did not explicitly block the investment in Essential, Son may have seen some conflict of interest in investing with a rival smartphone maker.
It is unknown as to how much the loss of this funding will play into the launch plans of Essential’s phone.