U.S. Markets open in 1 hr 24 mins

Phone Startup Led by Android’s Creator Shuts Down

Mark Gurman

(Bloomberg) -- Essential Products Inc., a smartphone startup founded by Android creator Andy Rubin, has shut down.

The company said it “made the difficult decision to cease operations.” Essential took its Project GEM phone, with a miniature screen and new software platform, as far as it could and sees “no clear path to deliver it to customers,” according to a blog post on Wednesday.

Rubin founded Essential after leading Google’s Android mobile software business for years. He left the internet giant in 2014 after an employee accused him of sexual misconduct. Google investigated, found the allegation credible and asked him to resign, but also gave him a $90 million exit package. That inspired protests by thousands of Google employees and at least one lawsuit against the company. Rubin has denied wrongdoing.

Essential raised more than $300 million from firms including Redpoint Ventures, Altimeter Capital, Tencent Holdings Ltd. and Foxconn Technology Group. Rubin’s startup incubator Playground Global was also a backer.

The startup was one of the first companies to use a full-screen design for smartphones, a trend that technology giants including Apple Inc. and Samsung Electronics Co. followed. Essential devices didn’t sell well early on and it cut jobs and put itself up for sale.

To contact the reporter on this story: Mark Gurman in Los Angeles at mgurman1@bloomberg.net

To contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net, Alistair Barr, Jillian Ward

For more articles like this, please visit us at bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

©2020 Bloomberg L.P.