Essential phone company valued at $1.2B before shipping anything

Essential phone company valued at $1.2B before shipping anything
Andy Rubin deserves a lot of faith in the mobile world given his record being the creator of Android and before that, the Danger Hiptop (aka Sidekick). However, it may seem odd to some that his new company, Essential, has been valued at $1.2 billion despite having not shipped a final product yet.

Rubin announced the Essential Phone, along with a home assistant, at the end of May and at the time it was made clear that the company was not taking preorders for the device, but rather just "reservations". As of a few weeks ago, Rubin sent out an update claiming the first devices would ship "in a few weeks", but so far nothing has shipped.

Even so, Bloomberg columnist Tim Culpan reported that Foxconn's FIH Mobile paid $3 million for "around 0.25%" of the company, which equates to a valuation of $1.2 billion. This wasn't much of a surprise as the company had been valuated at $997 million as recently as July, but it is still placing a lot of pressure on the company's products to make a mark. 

Whether or not that will happen is something we'll have to wait and see, but it's not an easy road, considering the only mobile hardware makers that have been consistently profitable are Apple and Samsung and Essential's home assistant will be playing catchup to the Amazon Alexa and Google Home. We should see the Essential Phone soon enough, so maybe we'll understand more soon. 

source: @TCulpin

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10 Comments

1. L0n3n1nja

Posts: 1557; Member since: Jul 12, 2016

Even if this phone launches and turns out as great as it should, will they sell enough to turn a profit? If someone invests in this phone, will they be around in a year or 2 for updates or customer support? Maybe I'm paranoid but I don't trust buying something expensive like this from a start up company. If a successful company wants to enter the smart phone industry I'm all for it, but I just see this as a risk, regardless of who runs or owns the company.

2. kylebelle

Posts: 74; Member since: May 03, 2016

I agree. Also i don't see this phone selling that great no matter how good it turns out. But I would love to be proven wrong.

3. you_sukk_it

Posts: 219; Member since: Apr 11, 2017

the mass majority of people know nothing about tech specs and many brands and really arent up to date on tech . this is a new company and few will get it. this is more catered to the tech nerds among us. and we are but a small amount vs the mass majority

10. Xelief

Posts: 62; Member since: Aug 17, 2015

You mean vast majority. Saying mass majority doesn't make any sense.

4. lhtbinh1909

Posts: 94; Member since: Apr 02, 2013

what is the different between a phone by Android's daddy and a Pixel, then?

5. rebretz

Posts: 114; Member since: Dec 26, 2011

Software. Even though Essential will run "stock" Android it won't have all the features that a Pixel phone will have. Essential will have it's own camera app/software, possibly dialer, as well as others I am sure.

8. L0n3n1nja

Posts: 1557; Member since: Jul 12, 2016

Pixel can be found in every Verizon store and is heavily advertised, while backed by a company that can afford to lose money if it doesn't sell well. Essential if I remember right will be unlocked, most won't have a clue what it is, and if it doesn't sell well enough for s profit which most mobile phones do not, than bye bye essential as they go bankrupt.

6. rebretz

Posts: 114; Member since: Dec 26, 2011

Google needs to buy Essential so then they have a good hardware division. I like the design of the Essential PH-1 a lot more than the Pixel phones and Essential was able to go near bezel-less and make a titanium phone on the first release.

7. fyah_king unregistered

Yep, they should.

9. Furbal unregistered

Good old tech bubble

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