A secured lender is selling off assets, including AR/VR patent portfolio, of Osterhout Design Group, the maker of R-9 and other smartglasses
Ian Hamilton / UploadVR : Tweets: @jbullock85 , @mattj_di , @jank0 , and @charliefink Tweets: Jake Bullock / @jbullock85 : Another AR company goes down as the industry slides into the Trough of Disillusionment. Patent Sale For Osterhout Design Group (ODG) Planned For January https://uploadvr.com/... via @UploadVR @mattj_di : An unfortunate end for a innovative firm. Hardware consolidation in AR/VR continues. Best of luck to all the folks at ODG moving forward. #AR #VR #augmentedreality https://lnkd.in/drQGg5h Janko Roettgers / @jank0 : Looks like ODG is dead: Patent Sale For Osterhout Design Group (ODG) Planned For January http://uploadvr.com/... via @UploadVR Charlie Fink / @charliefink : This is really sad. @OsterhoutGroup dies with nary a whimper. Just silence, like a ship slipping under the sea. #AR #XR http://uploadvr.com/...
Context & Ripple Effects
Two years after its $58 million raise for mobile AR smartglasses, Osterhout Design Group has reached the end of the road: a secured lender is liquidating the company's assets, including its AR/VR patent portfolio and the R-9 smartglasses line, at a January sale. The company joins a lengthening list of well-funded AR hardware casualties — CastAR shut down and liquidated in 2017, and Disney-backed Jaunt cut staff and abandoned VR projects just two months before this sale was announced.
The pattern matters because these are not marginal players: each raised serious capital against the same smartglasses thesis, and each exited by asset sale rather than acquisition. The buyer of ODG's patents will effectively be deciding what survives of one of the earliest dedicated AR hardware portfolios.
First-order effects
- ODG's secured lender takes control of the wind-down, recouping value through the January asset sale while employees, unsecured creditors, and the R-9 product line absorb the losses.
Second-order effects
- ODG's patent portfolio becomes an acquisition target for larger AR/VR players looking to cheaply absorb early smartglasses IP — the same dynamic that saw Snap pick up assets from failed rival Daqri.
Third-order effects
- If the CastAR–Jaunt–ODG sequence holds, independent AR hardware startups become structurally unfinanceable, leaving smartglasses to deep-pocketed platform companies that can subsidize years of losses — and making distressed patent sales the standard exit rather than M&A.
The trend: Consumer and enterprise AR hardware is sliding into a consolidation phase in which venture-backed startups die as liquidations and their IP gets absorbed by surviving platform giants.