Kitchener-Waterloo based North has been acquired by Google.
North, formerly Thalmic Labs, revealed the deal on Tuesday calling the acquisition “a terrific fit” for the smart glasses developer.
The close of the deal comes after reports in recent weeks that North was set to be acquired by Google parent company Alphabet. In a blog post on Tuesday, the startup’s co-founders – Stephen Lake (CEO), Matthew Bailey (CTO), and Aaron Grant – confirmed that North has been acquired by Google.
As part of the deal, North and its team are set to remain in Kitchener-Waterloo. The company added in the email that it will not be shipping Focals 2.0 as previously planned.
“It became clear that aligning with Google would significantly advance our shared vision.”
“Over the last while, it became clear that aligning with Google would significantly advance our shared vision,” said the North co-founders. “We’re proud to have grown our company in the Kitchener-Waterloo region and are thankful for the tremendous support we’ve received from the community. We are looking forward to remaining in the region with Google.”
“We are winding down Focals 1.0 and we will not be shipping Focals 2.0, but we hope you will continue the journey with us as we start this next chapter,” they added.
Some customers have reportedly already received notice that their current Focals will stop working as of July 31. As such, North is reportedly full refunds for each device sold.
A blog post from Rick Osterloh, senior vice president of devices and services at Google, noted that Google plans to use North’s technical expertise to help the tech giant invest in its own “hardware efforts and ambient computing future.”
“[North will] join the Google team based in Kitchener-Waterloo, Canada—North’s hometown and an area with impressive tech talent,” said Osterloh.
Google has had its own struggles with smart glasses over the years. Google developed and released its pair of smart glasses (Google Glass) in 2013, and put the product on the market before the announcing it would stop production of the prototype in 2015.
North, founded in 2012, first launched under Thalmic Labs, creating the Myo armband. In 2016, North raised $120 million USD. In September 2018, BetaKit was first to report that North was set to launch the smart glasses in October of that year.
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This past year saw North opening showrooms and shipping its Focal smart glasses, but also brought difficulties. The startup began shipping its smart glasses in late January 2019 and less than a month later dropped the price of the Focals significantly. Shortly after, North laid off 150 employees, close to a third of its then-workforce, which reportedly was higher than 400.
In December, North announced that it had ended the production and sale of the first generation of its Focals smart glasses and was shifting its focus to Focals 2.0.
It is unclear at this point how many people from North’s team, which according to LinkedIn is more than 200 employees, will be staying on through the acquisition.
The approximately 200-person workforce comes as Google committed earlier this year to hire an additional 1,500 employees, on top of the existing 1,000, at its Kitchener-Waterloo office. The Google commitment was part of its plan to build the three new Canadian offices, which would collectively house up to 5,000 employees.
The terms of Google’s acquisition of North were not disclosed. According to The Globe and Mail, which was first to report that North was set to be acquired, the deal was expected to be worth around $180 million USD, close to the amount of capital that North had raised over its eight-year span. According to Crunchbase data, North had raised around $199.6 million in equity and debt financing. The Globe pointed to potential high cash burn through the years, within North.
“Not even Google with its money got it right,” Michael Hyatt, an early seed investor in North, told BetaKit. “I believe North was on its way to getting it right, and I think [the company] just needed a lot more money.” Hyatt also pointed to the onset of COVID-19 as possibly having presented increased challenges for the startup.
“[North] took on a very big problem and it was incredibly challenging and, to be honest, I’m really proud of them,” he added.
“We couldn’t be more thrilled to join Google, and to take an exciting next step towards the future we’ve been focused on for the past eight years,” said North’s co-founders in their statement.