Android creator may sell Essential, scraps production of new phone
Essential Products Inc., the startup of Android creator Andy Rubin, has cancelled production of its latest phone and is considering selling itself, Bloomberg reports, citing people familiar with the matter.
Why it matters: Rubin had raised a ton of money but sales of its first phone were sluggish.
The details: Essential has reportedly commissioned Credit Suisse Group AG to broker the potential sale and "is now actively shopping itself to potential suitors," per Bloomberg. The company had been valued between $900 million to $1 billion last year, Bloomberg adds. Essential didn’t comment directly on the possible sale, but confirmed to Axios in a statement it has canceled some projects.
“We always have multiple products in development at the same time and we embrace canceling some in favor of the ones we think will be bigger hits. We are putting all of our efforts towards our future, game-changing products, which include mobile and home products.”— Spokesperson for Essential
The bottom line: Essential had hoped to do more than phones, but by starting with a phone, the company risked not getting beyond that. The phone market is a highly competitive business where most of the Android sales and profits go to Samsung as others fight for scraps.