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Magic Leap’s CFO is stepping down after it was ‘mutually decided’ it was time for someone new. Read the email Magic Leap’s CEO just sent to employees.

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Magic Leap’s CFO is stepping down after it was ‘mutually decided’ it was time for someone new. Read the email Magic Leap’s CEO just sent to employees.

Category : entrepreneur

  • Magic Leap Chief Financial Officer Scott Henry is stepping down, Business Insider has learned.
  • He will help on-board a new chief financial officer and act as an adviser to the company moving forward, according to an internal email obtained by Business Insider sent by Magic Leap’s CEO to employees on Friday.
  • “I want to let you know that Scott Henry and I have mutually decided that it is time for us to part ways,” Magic Leap CEO Rony Abovitz wrote in the email. “Scott’s leadership and his expertise in financial management and raising capital have been an integral part of Magic Leap’s growth and success over the past five years.”
  • In another personnel change, John Gaeta, the creator of the bullet-time special-effects technology in “The Matrix” and Magic Leap’s senior vice president of creative strategy, has left the company, sources familiar with matter confirmed to Business Insider.
  • The CFO shakeup comes just days after Magic Leap announced a Series E funding round. The startup has reportedly raised $2.6 billion since 2010, not including the Series E, which Abovitz writes in the email has generated over $500 million in investments so far.
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Magic Leap Chief Financial Officer Scott Henry is stepping down and will help train a successor before transitioning into an advisory role, Business Insider has learned.

“I want to let you know that Scott Henry and I have mutually decided that it is time for us to part ways,” Magic Leap CEO Rony Abovitz wrote on Friday in an email to employees obtained by Business Insider. “Scott’s leadership and his expertise in financial management and raising capital have been an integral part of Magic Leap’s growth and success over the past five years.”

Henry is stepping down as chief financial officer just days after Magic Leap announced a Series E funding round, which Abovitz wrote in the email has attracted “over $500 million” in investments.

It was not immediately clear from the email what prompted the decision for Henry to step down.

Magic Leap is a pioneer in the field of augmented and mixed reality, in which digital images are overlaid on a user’s view of the real world to create a surreal experience. The Plantation, Florida-based startup has raised billions of dollars from high-profile investors such as Google, Alibaba, and Warner Bros.

But the company faced technical challenges that frustrated its efforts to ship its first product, as well as a series of internal problems within the workforce, including a 2017 lawsuit alleging a hostile work environment for women. Henry was one of several Magic Leap executives named in the lawsuit filed by former Magic Leap vice president Tannen Campbell. Magic Leap and Campbell settled the lawsuit in May 2017.

“As we move into our next phase, Scott and I feel that the time has come for someone new to enter into this role,” Abovitz said in the email. “Scott will remain a true advisor and friend to Magic Leap and will be involved in on-boarding a new CFO, once they have been identified. I want to thank Scott for his dedication, passion, and partnership over the years and wish him nothing but the best in finding his next adventure.”

‘The time has come for me to think of life beyond Magic Leap’

Henry has been with Magic Leap since December 2014, having previously served as chief financial officer of Beats by Dre and Beats Music. He confirmed his role change in a message to Business Insider on Friday but did not elaborate.

“I am extremely proud that I have been in a position to contribute to the incredible things that have been achieved at Magic Leap over the past 5 years,” Henry wrote in a statement included in the email. “I firmly believe that Magic Leap has moved from being an IF company to a WHEN company and is destined for success and will continue to shape the spatial computing market. But the time has come for me to think of life beyond Magic Leap and Rony and I have mutually agreed that it is time for me to step into an advisory role, which will enable me to continue to be a friend and partner to the company.” 


Do you have a Magic Leap-related story to tell? Contact the reporter of this article at stweedie@businessinsider.com.


In addition to the CFO change, John Gaeta, Magic Leap’s senior vice president of creative strategy, is no longer with the company, sources familiar with the matter confirmed to Business Insider.

Gaeta joined Magic Leap in October 2017. Gaeta is best known for creating the bullet-time effect in the “Matrix” films, and in 2015, he cofounded ILMxLab to work on immersive entertainment. Gaeta did not immediately respond to a request for comment.

Magic Leap launched its first augmented-reality hardware product, the $2,300 Magic Leap One Creator Edition, in August 2018.

Magic Leap headset

The Magic Leap One Creator Edition.
Magic Leap

The headset is connected by wire to a puck-shaped module that houses the computational chip and battery powering the device. When worn, the Magic Leap One displays digital imagery and visuals that appear to exist within the physical space around you, and built-in sensors and tracking technology allow you interact with the digital assets.

Augmented reality is an area of growing interest among tech companies. Microsoft has launched two versions of its HoloLens augmented-reality headset over the past few years, and Apple is working on a hybrid AR/VR headset and developing a pair of AR glasses that connect to iPhones, according to a recent report from The Information. Snapchat has launched multiple versions of its Spectacles smart sunglasses, including its most recent with dual cameras for augmented-reality effects. 

Variety reported earlier this week that Magic Leap’s current funding round was a mix of equity and convertible debt, though  Abovitz provides no details about the funding in the email. According to Variety, Magic Leap also recently transferred its patents to JPMorgan, a practice that the publication said is not unusual for companies providing collateral for debt funding.

Not including the current Series E funding, Magic Leap has raised $2.6 billion since 2010 to fund the design and launch of its augmented-reality headset. The startup was last valued at over $6 billion. Past investors include companies such as Google, JPMorgan, Alibaba, AT&T, and Warner Bros.

Read the full email from Magic Leap CEO Abovitz to employees below:

Dear Magic Leapers,

A few bits:

(1) We have recently raised over $500 million US towards our E round, and are deeply engaged with investors and strategic partners towards the completion of the round. Our incredible progress on ML2, Magicverse, and our engagement with key strategic players are paving the way for a great future. Our senior team just returned from our steering committee review with NTT Docomo in Japan – their commitment to Magic Leap and our success is amazing.

(2) I want to let you know that Scott Henry and I have mutually decided that it is time for us to part ways. Scott’s leadership and his expertise in financial management and raising capital have been an integral part of Magic Leap’s growth and success over the past five years. As we move into our next phase, Scott and I feel that the time has come for someone new to enter into this role. Scott will remain a true advisor and friend to Magic Leap and will be involved in on-boarding a new CFO, once they have been identified.

I want to thank Scott for his dedication, passion, and partnership over the years and wish him nothing but the best in finding his next adventure.

From Scott:

“I am extremely proud that I have been in a position to contribute to the incredible things that have been achieved at Magic Leap over the past 5 years. I firmly believe that Magic Leap has moved from being an IF company to a WHEN company and is destined for success and will continue to shape the spatial computing market. But the time has come for me to think of life beyond Magic Leap and Rony and I have mutually agreed that it is time for me to step into an advisory role, which will enable me to continue to be a friend and partner to the company.”

(3) ML2 – I just want to say again how excited I am regarding the ML2 Bionicle turn-on – and that we are moving into our first PEQ builds in early 2020 – it is an incredible breakthrough – this kind of progress truly excites our Board, our investors, and our partners. They believe in our vision and the long game of spatial computing.

Thank you everyone – and have a great weekend.

Rony

Disclosure: Business Insider’s parent company Axel Springer is a minority investor in Magic Leap.

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About Author

Sammy Singh

Global VC, Founder, and entrepreneur extraordinaire as featured in Inc. Magazine, Bloomberg, and Forbes. Sammy Singh is a graduate of UCLA and Wharton School of Business as well as a former student of Loyola University of Chicago. Sammy is best known as a renowned financial technology global entrepreneur and has founded over 26 different firms across industry and all over the world. He is a venture capitalist,a TV/ Film actor, tax specialist, and marketing solutions strategist. Connect with Sammy Singh on social media below! www.linkedin.com/in/cfo www.instagram.com/champagnegqpapi www.facebook.com/officialsammysingh www.twitter.com/cxosynergy www.medium.com/@sammysingh www.crunchbase.com/sammysingh

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