Sources: Andy Rubin-backed AR gaming glasses startup CastAR shuts down, lays off about 70 and is liquidating assets
About 70 employees laid off, Eat Sleep Play shuttered — PIN — CastAR, the augmented reality start-up co-created by two former Valve employees, laid off its staff …
Context & Ripple Effects
CastAR was one of the better-funded bets on consumer augmented reality gaming: Android creator Andy Rubin put $15M into the company in 2015 to build AR glasses, co-created by two former Valve employees. Two years on, the bet has failed outright — about 70 employees laid off, operations shut down, and assets being liquidated rather than sold as a going concern, with game studio Eat Sleep Play shuttering alongside it.
The collapse lands amid an already visible retrenchment in AR hardware: just months earlier, enterprise headset maker Daqri cut roughly a quarter of its nearly 400-person workforce in what sources described as layoffs at a company that had raised $132M. CastAR's failure extends that squeeze from enterprise AR to the consumer gaming side.
First-order effects
- About 70 CastAR employees are out of work immediately, and Eat Sleep Play — the studio attached to the effort — ceases operations with them.
- Rubin's $15M and any other investor capital ends in asset liquidation rather than an acquisition or pivot, a total loss on the original thesis that consumer AR gaming glasses were near-term viable.
Second-order effects
- The consumer AR glasses category loses one of its few dedicated startups, leaving the field to larger, better-capitalized platform owners and pushing remaining independents like Avegant — which had already cut more than half its staff by early 2018 — under sharper investor scrutiny.
- Liquidation puts CastAR's AR optics and hardware assets on the market at distressed prices, a potential bargain for competitors or acquirers of talent and IP rather than a competitive exit.
Third-order effects
- If the pattern holds — Daqri's cuts preceding CastAR's death, with further contractions across the cohort — mid-2010s-vintage AR hardware startups exit not via IPOs or acquisitions but via wind-downs, resetting investor expectations that standalone AR glasses companies need either enterprise revenue or a platform patron to survive.
The trend: Standalone AR hardware startups from the mid-2010s funding wave are winding down or shrinking rather than reaching independent scale, concentrating the category around better-capitalized players.