The graphics start-up lab is dealing with great losses and will now scale down on operations substantially.
Previously this autumn, we mentioned Goo Technologies as a company to keep an eye on within the virtual reality sector. Now, however, it seems like the company isn’t doing quite so well.
The company is split in two parts. The first is their main product Goo Create which is a browser based 3D-editor. The second part is a studio which develops products based on Goo Create, like this 3D-map of Switzerland. It’s the studio that is now being dismantled and downsized. This results in about half of the 20 employees being laid off.
“We noticed that the underlying market for Goo Create has matured. There is not the same need for us to have a studio in-house anymore. We set all focus on our core business, which is Goo Create”, company CEO and co-founder Ola de Freitas, says.
He further explains that for them, the studio-part of operations has been a short-term project and more of a marketing activity than a central part.
Does that mean you have always considered the studio as a temporary part of operations?
“Yes, you could put it that way”, Ola de Freitas says.
The company has previously raised about $2.2 million in venture capital from Swedish investment companies Moor Capital and GP Bullhound. The company is now searching for additional investments and are, according to Breakit’s sources, have difficulties pulling the ongoing financial round ashore. Ola de Freitas does however not want to comment on it.
“I cannot say anything about that right now since it is not done yet. Like every start-up, we are of course interested in bringing in capital. We are open to investments”, he says.
From the company’s annual report for 2014 it does appear that the company will have trouble keeping the business afloat in 2015, without additional capital. The report also shows that the company made a $1.2 million loss with less than $800.000 net turnover last year.
According to Breakit’s sources Goo Technologies and Moor Capital is now at the final stages of reaching and agreement and the investment company is believed to make another capital injection.
“Our investment supposition, that Goo has something unique which can reach a large penetrating power, is still valid and we are discussing a financial solution suitable the focus”, CEO and co-founder of Moor Capital Kerstin Cooley writes in a SMS to Breakit.
Moor Capital, with a 33.2 share, is the company’s second largest investor after Ardor Labs AB. Which also is the company of the founders.