In its first foray into Israel, the company behind the wildly popular Snapchat app has agreed to buy the Israeli augmented reality company Cimagine Media for what sources estimated was $40 million.
Cimagine’s technology is used to scan and identify surfaces in scenes captured on a mobile or wearable device camera and overlays life-like 3D images onto real-time video. Unlike similar offerings, Cimagine’s markerless augmented reality doesn’t require the user to print and place a reference marker to identify surfaces and estimate scale.
Augmented reality is being used in a wide variety of applications, but Cmagine’s niche is retail, where it has formed partnerships with the British retailers Shop Direct and John Lewis as well as with Coca-Cola. Users can virtually place furniture or appliances they are thinking of buying in their homes before making a decision.
The retail factor could be the reasoning behind the decision by Snap – the company behind the Snapchat app – to buy the startup. Neither company had confirmed the acquisitions, but Snap, Snapchat’s parent company, is planning an initial public offering next year at as much as $25 billion and offering shopping options through the company’s popular messaging app could create new revenue channels.
Cimagine was formed in 2012 by CEO Yoni Nevo; Nir Daube, vice president for product development; and Ozi Egri, vice president for R&D – all of them entrepreneurs and engineers with a background in computerized vision. Since then the startup has raised about $3 million from the technology incubator Explore, where it operated its first two years. It won financing from Plus Ventures, a venture capital arms affiliated with Explore, from 2B Angels and the crowd-funding platform OurCrowd.
Sources termed the deal of acqui-hire transactions, where the buyer is more interested in obtaining the team behind the company than the company itself or its technology. Acqui-hires usually occur when a startup hasn’t succeeding in rolling out a successful product but has a strong R&D team.
Snap will be turning the tiny startup into a research and development center.
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