Snapchat has closed its first acquisition in Israel this week, buying four-year-old augmented reality startup Cimagine.
Snapchat Acquired Cimagine
According to Calcalist News, Snapchat acquired Israeli startup company Cimagine for an amount between $30 million and $40 million. Cimagine's augmented reality (AR) platform allows consumers to visualize instantly various products they want to buy in their intended location.
Cimagine currently works with top brands such as the U.K.-based digital retailer Shop Direct, the furniture store franchise in Southern California called Jerome's and the global giant Coca-Cola. The company's cloud-based mobile platform helps these big customers to augment their mobile apps and sites in order to increase in-store sales and online conversion rates in the process.
Reasons For Acquiring Cimagine
Tech analysts believe that Snapchat intends to use Cimagine's tech to further enhance its own online campaigns like the one for Starbucks, for instance. Last summer, Snapchat launched a summer drinks campaign for Starbucks, giving customers the ability to superimpose a lens over a picture of their icy Frappuccino beverage.
According to Tech Crunch, the move could also work like a talent grab of Cimagine's four co-founders. CEO Yoni Nevo, Amiram Avraham, Ozi Egri and Nir Daube are specialists in the fields of image processing and computer vision. The acquisition would also give Snapchat the opportunity of building a development center in Israel.
Other Snapchat Moves
Meanwhile, Snapchat is reportedly moving forward with an IPO expected to come as early as March and that could value the company at between $20 billion and $25 billion. The company made around half a dozen acquisition this year, including the mobile search app Vurb, adtech company Flite, a maker of personalized emojis called Bitstrips and a computer vision startup called Seene. More recently, Snapchat rebranded itself as Snap Inc.
Snapchat To Extend Into Augmented Reality Market
According to The Daily Caller, the technology created by Israeli startup Cimagine is called True Markerless Augmented Reality. This advanced technology allows customers to preview various products such as appliances and furniture. The users of this augmented reality technology are able to realistically see the products they wish to purchase by using a mobile app to virtually place the objects in their homes. This way, before making their purchasing decision, customers can get an in-home perspective view of the product.
According to Reuters, Snapchat will likely use Cimagine as a research and development center in Israel. Market analysts forecast that Cimagine's 20 employees workforce will likely expand rapidly from its current level, according to The New York Post. Tech experts point out that Snapchat's interest in Cimagine is due not only to its impressive technologies but also to its employees' remarkable skills.
The company has given a strong hint that it plans to move from apps to hardware by joining the industry group that governs the Bluetooth wireless standard. Collaborating with this group is an important prerequisite for any company that intends to use Bluetooth connectivity in its hardware products.
Snapchat was reported earlier this year to be working on its own AR headset. In fact, Snapchat already shows similar augmented reality technology by connecting virtual stuff in the real-world images. The company's popular "masks" or app filters customize a user's selfies with playful animations.