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Here’s who’s hiring Magic Leap’s laid-off employees

Apple has been ramping up the hiring of AR and VR talent, while Snap is notably absent.

A woman wearing Magic Leap glasses

Apple seems to be the most aggressive about hiring augmented and virtual reality talent.

Photo: Chesnot via Getty Images

When Magic Leap put the brakes on plans to launch a consumer-ready augmented reality headset in April, it laid off hundreds of employees, including key engineers working on AR hardware and experiences. Those employees are a prime target for other tech companies looking to bolster their visual computing chops, with one former senior Magic Leap employee telling Protocol that Facebook, Amazon, Apple and Microsoft all have been recruiting laid-off Magic Leap staffers.

Among those companies, Apple seems to be the most aggressive about hiring augmented and virtual reality talent. The iPhone maker has been working for some time on its own AR headset, and the CEO of a VR startup recently told Protocol that the company was "ramping up and reaching out to everyone," which is said to include aggressive poaching efforts.

Bloomberg was first to report in April that Magic Leap was laying off around 1,000 employees. Two months in, the actual number of full-timer staffers affected by the cuts is said to be closer to 600. Hiring during COVID-19 is slow and tedious — a process made more complicated by the fact that Magic Leap employees who relocated to the company's headquarters in Florida may now find themselves forced to return to the Bay Area or other tech hubs in order to start at one of the big tech companies.

But even though many are likely still in the middle of the hiring process, some have started to update their LinkedIn profiles. Combined with historic hiring records, this is starting to give us a good idea where Magic Leap's talent is heading — and which companies have been tapping the AR startup's talent pool for some time.

Here's where employees who changed their current employment affiliation on LinkedIn over the past six months have ended up:

Apple's growing interest in former Magic Leap employees becomes even more obvious when compared to a historic record of all the staffers at big tech companies who at some prior point in their career worked for Magic Leap:

Apple's share of ex-Leapers, as Magic Leap employees are called in the company vernacular, clearly increased in recent months as the company is gearing up to release its own AR headset. That's also reflected in the types of roles Apple is hiring for, which in just the past three months included an XR prototyper, a computer vision engineer and an optical systems engineer.

In contrast, some of the recent hires at other companies seem to be less focused on AR and VR. Amazon for instance hired a former Magic Leap product security program manager for its antivirus efforts, and Google hired a Magic Leap site reliability engineer to work on the Google Cloud team.

One company that stands out as surprisingly absent from the hiring is Snap. The Snapchat maker is reportedly working on its own AR hardware and has experimented with wearables in the past. However, only four of the company's current employees with active LinkedIn profiles list Magic Leap as a previous employer. One reason for this is that the company has staffed up in bulk: Snap hired around two dozen employees of the failed AR hardware startup Daqri late last year, as Protocol was first to report in February.

Janko Roettgers

Janko Roettgers (@jank0) is a senior reporter at Protocol, reporting on the shifting power dynamics between tech, media, and entertainment, including the impact of new technologies. Previously, Janko was Variety's first-ever technology writer in San Francisco, where he covered big tech and emerging technologies. He has reported for Gigaom, Frankfurter Rundschau, Berliner Zeitung, and ORF, among others. He has written three books on consumer cord-cutting and online music and co-edited an anthology on internet subcultures. He lives with his family in Oakland.

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Protocol | China

Everything you need to know about the Yuanxin Technology IPO

Image: Yuanxin

Yuanxin Technology doesn't hide its ambition. In the first line of its prospectus, the company says its mission is to be the "first choice for patients' healthcare and medication needs in China." But the road to winning the crowded China health tech race is a long one for this Tencent- and Sequoia-backed startup, even with a recent valuation of $4 billion, according to Chinese publication Lieyunwang. Here's everything you need to know about Yuanxin Technology's forthcoming IPO on the Hong Kong Stock Exchange.

What does Yuanxin do?

There are many ways startups can crack open the health care market in China, and Yuanxin has focused on one: prescription drugs. According to its prospectus, sales of prescription drugs outside hospitals account for only 23% of the total healthcare market in China, whereas that number is 70.2% in the United States.

Yuanxin started with physical stores. Since 2015, it has opened 217 pharmacies immediately outside Chinese hospitals. "A pharmacy has to be on the main road where a patient exits the hospital. It needs to be highly accessible," Yuanxin founder He Tao told Chinese media in August. Then, patients are encouraged to refill their prescriptions on Yuanxin's online platforms and to follow up with telehealth services instead of returning to a hospital.

From there, Yuanxin has built a large product portfolio that offers online doctor visits, pharmacies and private insurance plans. It also works with enterprise clients, designing office automation and prescription management systems for hospitals and selling digital ads for big pharma.

Yuanxin's Financials

Yuanxin's annual revenues have been steadily growing from $127 million in 2018 to $365 million in 2019 and $561 million in 2020. In each of those three years, over 97% of revenue came from "out-of-hospital comprehensive patient services," which include the company's physical pharmacies and telehealth services. More specifically, approximately 83% of its retail sales derived from prescription drugs.

But the company hasn't made a profit. Yuanxin's annual losses grew from $17 million in 2018 to $26 million in 2019 and $48 million in 2020. The losses are moderate considering the ever-growing revenues, but cast doubt on whether the company can become profitable any time soon. Apart from the cost of drug supplies, the biggest spend is marketing and sales.

What's next for Yuanxin

There are still abundant opportunities in the prescription drug market. In 2020, China's National Medical Products Administration started to explore lifting the ban on selling prescription drugs online. Although it's unclear when the change will take place, it looks like more purely-online platforms will be able to write prescriptions in the future. With its established market presence, Yuanxin is likely one of the players that can benefit greatly from such a policy change.

The enterprise and health insurance businesses of Yuanxin are still fairly small (accounting for less than 3% of annual revenue), but this is where the company sees an opportunity for future growth. Yuanxin is particularly hoping to power its growth with data and artificial intelligence. It boasts a database of 14 million prescriptions accumulated over years, and the company says the data can be used in many ways: designing private insurance plans, training doctors and offering chronic disease management services. The company says it currently employs 509 people on its R&D team, including 437 software engineers and 22 data engineers and scientists.

What Could Go Wrong?

The COVID-19 pandemic has helped sell the story of digital health care, but Yuanxin isn't the only company benefiting from this opportunity. 2020 has seen a slew of Chinese health tech companies rise. They either completed their IPO process before Yuanxin (like JD, Alibaba and Ping An's healthcare subsidiaries) or are close to it (WeDoctor and DXY). In this crowded sector, Yuanxin faces competition from both companies with Big Tech parent companies behind them and startups that have their own specialized advantages.

Like each of its competitors, Yuanxin needs to be careful with how it processes patient data — some of the most sensitive personal data online. Recent Chinese legislation around personal data has made it clear that it will be increasingly difficult to monetize user data. In the prospectus, Yuanxin elaborately explained how it anonymizes data and prevents data from being leaked or hacked, but it also admitted that it cannot foresee what future policies will be introduced.

Who Gets Rich

  • Yuanxin's founder and CEO He Tao and SVP He Weizhuang own 29.82% of the company's shares through a jointly controlled company. (It's unclear whether He Tao and He Weizhuang are related.)
  • Tencent owns 19.55% of the shares.
  • Sequoia owns 16.21% of the shares.
  • Other major investors include Qiming, Starquest Capital and Kunling, which respectively own 7.12%, 6.51% and 5.32% of the shares.

What People Are Saying

  • "The demands of patients, hospitals, insurance companies, pharmacies and pharmaceutical companies are all different. How to meet each individual demand and find a core profit model is the key to Yuanxin Technology's future growth." — Xu Yuchen, insurance industry analyst and member of China Association of Actuaries, in Chinese publication Lanjinger.
  • "The window of opportunity caused by the pandemic, as well as the high valuations of those companies that have gone public, brings hope to other medical services companies…[But] the window of opportunity is closing and the potential of Internet healthcare is yet to be explored with new ideas. Therefore, traditional, asset-heavy healthcare companies need to take this opportunity and go public as soon as possible." —Wang Hang, founder and CEO of online healthcare platform Haodf, in state media China.com.

Zeyi Yang
Zeyi Yang is a reporter with Protocol | China. Previously, he worked as a reporting fellow for the digital magazine Rest of World, covering the intersection of technology and culture in China and neighboring countries. He has also contributed to the South China Morning Post, Nikkei Asia, Columbia Journalism Review, among other publications. In his spare time, Zeyi co-founded a Mandarin podcast that tells LGBTQ stories in China. He has been playing Pokemon for 14 years and has a weird favorite pick.
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