After Essential failure, OSOM plans new privacy-focused handset – TechCrunch

The Essentials of last year The implosion marked one of the most publicized consumer electronics startup failures in recent memory. Launched in 2017 with $ 330 million, a killer pedigree, and some truly grandiose ambitions, the company has flouted through a combination of industry issues, disappointment, and troubling allegations against founder Andy Rubin.

The brand was eventually bought by Carl Pei for his new business. But the executive ultimately resisted the name in favor of “Nothing.” “[B]before we called ourselves Nothing, ‘Essential’ was one of the names we were thinking about, internally, ”he told me earlier this year. “That’s why we acquired the brand. We don’t plan to do anything with Essential.

Something much closer to a spiritual successor is coming in the form of OSOM. The company, founded by former Essential employees, has received little media coverage in recent months but has remained largely silent. Today, however, the California-based Cupertino confirmed what many have long suspected: OSOM (pronounced “awesome”) works on a phone.

Its planned OV1 device is, at least aesthetically, very clearly the work of the same team that gave the world the Essential PH1. But rather than features like modularity, the product is designed with one goal in mind: privacy. Specifically, it is designed to give users greater control over data privacy.

Beyond that, details are scarce ahead of its scheduled launch at MWC 2022. We caught up with co-founder and CEO Jason Keats for more information on OSOM and its future handset.

TC: Are we about two months away from the announcement?

JK: Yeah, we’re a few months away from sharing the finer details. We plan to give the full announcement to MWC and then ship in the summer of 2022. Right now we are ready to announce that we are building a phone. People are really excited. We wanted to give our fans something this year, and we’re coming under the wire.

What constitutes a fan at this point, given that the business has been under lock and key?

It was really surprising. The core fans were very, very supportive at the start, and they continued to support us and be excited about what we’re building for the future. I think we’re going to attract a lot of mainstream Android fans. Right now, there aren’t many flagship phones outside of Pixel that are vanilla Android. We will continue to do so, and we have already built and continue to refine some privacy-focused software.

How many members of the existing team came from Essential?

When we built PH1 at Essential, we were maybe 30 people in total. We have maybe 15 people on that team. It is really the core of people; design, engineer, product design and software engineering.

What is the size of the team in total?

About 30 people […] We are more than two-thirds of the engineers.

How did you begin the process of building one business from the ashes of another?

For all the shortcomings and mishaps that have happened at Essential, one thing I will praise [Rubin] forever is its ability to recruit. He brought incredible talent. When he told me the business was going down, I said, what am I going to do next? I don’t want to work for Google or Apple or go to Amazon, but there’s this amazing team out there who’ve built things up and worked so closely together. He walked through the trenches together[…]

We realized that probably the biggest problem [with Essential] was a lack of concentration. We realized we had to have a purpose. What are we trying to solve? It became apparent to us that privacy was really not being addressed consistently, especially in 2020.

Does the world need another phone company?

Yes, absolutely I think they do. One that’s actually all about privacy. And there is a big reason for this. If we were just a software company making privacy software, we could put it on the play store, people could install it, whatever. But if it is just an app installed on someone’s phone, it is easily bypassed, it is easily disabled because it is not integrated into the system. It is not integrated into the device. This is what we do. Because we are an OEM, because we have access to Qualcomm’s TrustZone, because we have access to system software, we can create real privacy-centric software that the user can use or not, if they need it. wish. But it is about giving them the choice.

How hard will it be to get someone to jump on that phone with privacy as the main selling point?

In the United States, I don’t try to prey on Apple users. We are going after Android users. And in this scenario, there isn’t a huge amount of brand loyalty in the Android space. People are ready to take a lot more pictures. For privacy, we’ve already lined up a number of partners who have shared high-level demographics on who uses their software or hardware for privacy. The figures amaze us. They really indicate that there is a demand for privacy and that people are currently spending their money on privacy.

What is a realistic expectation in terms of units? You cast a wide net [to the U.S., Canada and throughout Europe]. It seems that in the end, essential numbers weren’t what people were hoping for.

It’s funny. When we launched Essential, the goal was 100,000 units in the first year. We sold just under 300,000 units to end users in the first year. The biggest problem is because [Rubin] amassed so much money, it was expected to ship two million units. When you wait for 100,000 units and sell 300,000 units, that’s a huge success. It all depends on the metric you are using. For [OSOM]I would absolutely love 200,000 units in the first year. We would be here a long, long time.

Were the outside expectations so intense they made things fall apart [at Essential]?

I can fill out a book about what went wrong. And there were lots of little things.

Give me the CliffsNotes.

Some decisions made at the highest level were counterintuitive to our success.

Regarding capital, it was reported that the company had raised 5.6 million dollars. What has been the fundraising so far.

So we got $ 20 million. Part of that investor, and part of it was a pre-order from a channel partner. We already have orders close to the number we can support in the first year. Most of our investors were from myself and my co-founder Wolfgang and our external VCs were all primarily Canadian companies.

Was there a Series A in addition to the initial seed funding?

We are currently in the middle of a series A.

Was Playground involved?

No. We had a long conversation with them. The team there – Bruce, Matt and Peter – are still great friends. I still use them as sounding boards for ideas.

When was the business officially launched?

The articles of association were officially filed on 4 20 2020.

The name is pronounced “awesome? What was the first one, the name or the acronym?

Twenty minutes later [Rubin] told me that Essential was leaking, I was like, “Okay, I’m gonna do my own thing.” I hate stuff that’s super obvious. I hate all the wires and plugs and this and that all over your house, and it drives me nuts. And I got this idea for a different product, which we could possibly build or not. It has nothing to do with the phone, but just a crazy idea. But the idea was out of sight, out of mind. I think about what folks, what the average consumer really imagines when we talk about future technology in Star Trek, and the meaning of speech and something responds out of the ether. It’s not something on my desk that has a nine foot long cable, but it’s only twenty-five inches from the wall. The idea was that thing coming out of the ether, and the idea was “out of sight, out of mind.” Oh, OSOM, we’ll just call it awesome. I checked it in from the hotel in Hong Kong.

Are any of these initial ideas being applied here? Obviously, privacy is the thing.

That’s definitely the mindset, because of the way we build our software. The idea is that, again, it keeps one out of sight, out of mind; you just have to trust that your devices are protecting you when you want to be safe.

At the moment it is an American company?

Yes. We are a Delaware C Corp. Like every other tech company, probably all registered at the same address.

You spoke to the Canadian government about incentives… but you will continue to have your head office in Cupertino?

Right now, it’s in the air. OSOM Products, the American company, will continue to exist. But we can move our head office to Canada.

What do Essential and OSOM have in common? Philosophical? Aesthetic?

Aesthetically, 100%. Even though it’s the same designer, Dave Evans and I do the industrial design, we didn’t really see it as an obvious successor to the PH1, until we had the first prototype, that is. ‘was like, “this was clearly designed by the same team”. Both from a material point of view and from an aesthetic point of view, it is the continuity of the same crew. Our software team, especially when it comes to Android and security updates, the team that was responsible for super-fast updates at Essential is here at OSOM.

Let’s talk about advertising. How will you differentiate the brand from the other 800 phone makers?

I don’t want to give anything away, because I’m super excited about it. I’ll put it this way: When we show the whole team the campaign ideas and the first drafts, the people who have been at Essential since the very beginning, they ask themselves, ‘why haven’t we done that before? We have to spend on marketing to differentiate ourselves. Much of the money we have raised is spent on marketing.

What can we expect from the spec side?

It is a flagship device, both in terms of hardware and software.

Is it difficult to keep the price of a first piece of equipment low?

Not really. The team that I brought from Essential, when it comes to supply chain, is one of the best in the world. Our partners have been surprisingly united. We got incredible rates. Literally go to a few meetings like, “I just want the same price to give Apple and Google.”

So at a price comparable to other flagship products.

We’re going to be well under $ 1,000.

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