Coverage: Snapchat parent is buying augmented reality company
Snap has reportedly made an investment in augmented reality, purchasing the Israeli-based startup Cimagine Media in a deal that’s said to be worth between $30 million to $40 million.
Ken Yeung of VentureBeat had the news:
Through this purchase, Snap will establish a development center in the Middle East, one where it will eventually employ more than the 20 people currently working at Cimagine Media.
Founded four years ago, Cimagine specializes in computer vision, real-time image processing, mobile development, international marketing, and more. All of these are obviously compelling for Snap, whose app Snapchat is heavily reliant on augmented reality and the like. But what Cimagine brings to the table is a focus on commerce and as Snap looks towards going public perhaps some time next year, it’s quite possible that doing facilitating shopping through Snapchat might open up additional revenue opportunities.
Cimagine already has partnerships with Shop Direct, John Lewis, and Coca-Cola and wants to help retailers tap into the potential of augmented reality. So Snap may want to eventually strike partnerships with big box retailers and department stores to accelerate engagement and time spent on site. Merchants and store owners may want additional advertising opportunities so the potential of what Cimagine’s technology and team could bring to bear may be enticing.
Connie Loizos of TechCrunch writes that Snapchat will use the acquisition to expand its current businesses:
According to its LinkedIn page, Cimagine currently works with brands like Jerome’s, a furniture store franchise in Southern California; the U.K.-based digital retailer Shop Direct; and the global giant Coca Cola — its cloud-based mobile platform aiming to help these companies augment their sites and mobile apps and boost online conversion rates and in-store sales in the process.
Presumably, Snapchat will use the tech to further enhance campaigns like we’ve seen in the past with, say, Starbucks, which launched a Snapchat chilled summer drinks campaign last summer, giving Starbucks drinkers the ability to superimpose a lens over a picture of their icy Frappuccino beverage and send it to their friends.
This also looks like a talent grab, with Cimagine’s four cofounders — Ozi Egri, Amiram Avraham, Nir Daube and CEO Yoni Nevo — each specialists in the fields of computer vision and image processing.
The move would also seem to give Snapchat a way to begin building out a development center in Israel if it wants.
CrunchBase shows that Cimagine had raised an undisclosed amount of seed funding, including from iVentures Asia, OurCrowd, and Plus Ventures.
Chris Velazco of Engadget explains why the deal is important to Snapchat:
“Fine,” we can almost hear you muttering. “But why does this matter?” Well, we can hazard a few guesses, but everything boils down to one simple fact: this purchase could help Snap Inc. make some serious cash. If you haven’t heard of Cimagine before, it spent the last few years building some surprisingly neat augmented reality tech — specifically, software that lets brands and retailers show off their products in the virtual space in front of your smartphone’s camera. We’ve seen companies like Google do this with Tango, but that specific implementation requires extra cameras and sensors — Cimagine’s doesn’t. (That’s not exactly rare, by the way, but the lack of extra hardware makes the people who achieve solid performance through just software look really good.)
That said, do us a favor: Imagine a Snapchat filter that, in addition to giving you a goofy pair of glasses and a trimmer face, also plops a virtual Coke vending machine behind you. Snap Inc. also rolled out “world lenses” last month, which allows people to use their phones’ main/rear cameras to see objects — like stars, moons, and clouds that drool rainbows — hovering in front of them. Cimagine’s tech and team could help the company figure out how to turn these rudimentary effects into mini-experiences fit into AR environments with more sophistication. This time, imagine a filter where you tap on a stretch of empty space of wall and a Coca-Cola Santa Claus emerges from it waving a frosty bottle.
These are pretty ham-fisted examples, but Cimagine already has a working relationship on the books with those sugar-water slingers, and brands likes Taco Bell haven’t shied away from the from big price tags that come with of sponsored filters. No, seriously: sources told Business Insider earlier this year that the 24-hour filters can run between $100,000 and $750,000. The thing is, Snapchat has to work more closely with these brands, especially because a good sponsored filter takes a ton of work to achieve.