Microsoft executive Peggy Johnson is migrating to augmented reality startup Magic Leap, believing its technology has a future in the enterprise market.
The hire brings needed credibility to Magic Leap, though the firm has never lacked big investors. Founded in 2010, it attained a $6.7 billion valuation in April 2019, according to PitchBook, making it one of the most well-capitalized consumer hardware startups ever. But its flagship augmented reality (AR) headset, released in December, was a flop. Of course, Magic Leap is hardly the only unicorn to fall short of expectations. Nor is it the only firm to see disappointing sales from AR or VR headsets for consumers. Mass appeal has eluded Google Glass and Facebook’s Oculus VR.
This year Magic Leap halted production of its consumer hardware, slashed its workforce, and shifted its focus to business applications. Another round of funding in May garnered $375 million. The same month, founder and CEO Rony Abovitz announced he would step down. “I discussed this with the board and we have agreed that now is the time to bring in a new CEO who can help us to commercialize our focused plan for spatial computing in enterprise,” Abovitz wrote in a blog post.
Effective August 1, it will be the job of Peggy Johnson to steer Magic Leap in its new direction. Johnson is Executive Vice President of Business Development at Microsoft and a 30-year veteran of the technology industry. Thus her background aligns well with Magic Leap’s vision for growth in the enterprise market. She joined Microsoft in 2014 after 24 years with Qualcomm, where she was most recently Executive Vice President and President, Global Market Development.
While heading business development at Microsoft, Johnson brokered major partnerships and led the software giant’s acquisitions. These included the company’s biggest-ever – the purchase of LinkedIn for $26 billion in 2016. She was also instrumental to the genesis of Microsoft’s M12 venture capital fund (formerly Microsoft Ventures) to invest in startups, mainly in cloud computing and artificial intelligence, the New York Times reports.
The move comes as a surprise to many, given Johnson’s senior role with Microsoft and status as a key member of CEO Satya Nadella’s senior leadership team. But she sees opportunity in Magic Leap’s augmented reality technology. This opportunity has grown during the pandemic, she said, with people working remotely and traveling less, as there are potential applications in job training, the medical field, and industrial automation. Johnson also said she had long aspired to be a chief executive. “I chose this,” she said. “It really says something that, at this point in time, I would leave Microsoft to go to this space, because Microsoft is doing quite well.”