News: 'The Matrix' Movie Effects Pioneer & Former Magic Leap Exec Reveals 'Tragic Story' of Startup's Recent Struggles

Magic Leap has had a rough couple of years, highlighted by high-profile executive departures, lawsuits, troublesome patent shuffles, and massive layoffs.

Despite this, things seem to have calmed down at the augmented reality startup under Peggy Johnson, but there are still questions as to how things went awry under the old regime.

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Most former Magic Leap staff have remained tight-lipped, but now one major former executive is finally shedding some light on the situation.

Magic Leap's former senior vice president of creative strategy, John Gaeta, the man behind some of the iconic effects in the original The Matrix movie series, exited the company back in 2019. Since then, Gaeta has been mostly off the radar, other than his contributions to the upcoming The Matrix 4 movie coming later this year.

However, this week Gaeta took a break from his other work to talk about his career and its intersection with AR, and in the process provided some rare insight into what happened at Magic Leap leading up to its struggles just before the pandemic hit.

Ironically, in light of our new remote culture, one of the biggest revelations from Gaeta is the elephant that has always been in the room regarding Magic Leap: location.

"It was a bubble in the state of Florida. Kind of an odd thing. These bubbles are double-edged swords," said Gaeta in a nearly two-hour chat with EON Reality founder Dan Lejerskar (Gaeta now sits on the company's advisory board).

"The bubble is away from Silicon Valley, so you're not contaminated by being in the neighborhood in a way. But at the same time, you're isolated and so you are not getting the benefit of [the] awareness of other things that you need to be aware of. Or the benefit of certain talent that doesn't necessarily live in Florida. So they have to import all of the talent. [That is] super problematic in my opinion, because it's a big life decision for a person and you don't get everyone you really need."

It's an interesting perspective given everything we've learned in the last year and a half. Sure, working remotely can be optimal in many ways, but what Gaeta is pointing out is that there's simply no substitute for the kind of positive friction and innovative serendipity that can happen in major technology hubs. Siloing your company away from that kind of aggregate talent and idea pool can leave your team with unexpected blind spots and potential deficiencies.

But location and sourcing of talent are just part of what Gaeta thinks went wrong at Magic Leap. Most of all, what comes across in his commentary is something that has plagued many ambitious startups: lack of laser focus.

"I swear I could write maybe a book or two about the things and the people that I got to meet there. I would put it in these terms: the drive to reach some of the vision that Rony [Abovitz] was laying out there was intense and taken very seriously by some very smart people. The company itself, in my view… it all has to do with what you prioritize as of value," said Gaeta.

"You have a bit of a conflict when you have a hardcore engineering mission, which is, in this case, the transmission of holographic images in daylight, and the immense issues with tracking and all of those sorts of things. This is like a rocket ship mission. There was a lot of people I noticed in the press naively disregarding the sheer immensity right of that lift, and somehow Magic Leap and the engineers there were able to get on the page. And even before other companies that were like a hundred-X more resourced."

Indeed, what Magic Leap accomplished should be lauded. The Magic Leap One and its accompanying software platform are a fantastic system. But while Gaeta's comments seem to reference initial reviews of the device that weren't all that glowing, what's missing is the fact that Magic Leap's early promises (dating back to 2015) didn't seem to match what it ultimately delivered.

In contrast, what immediately comes to mind is how Snap founder and CEO Evan Spiegel has diligently "undersold" what it is doing in the way of AR smartglasses. For example, back in 2019, Spiegel claimed that mainstream AR smartglasses may be a full decade away, all while knowing that he was about to launch his own user-friendly AR wearable.

Similarly, instead of showing off idealized versions of Spectacles AR scenes (as Magic Leap was frequently accused of doing), the first demo footage of the new Spectacles showed just how limited the field of view is on the device. Although Magic Leap's former CEO seemed to want to follow the marketing playbook of Steve Jobs-era Apple, the key aspect in the computer giant's strategy was consistently underpromising and overdelivering. Snap seems to be getting that part right, while Magic Leap's early aspirational language and visuals were, well, sometimes a bit of a leap.

If the Snap versus Magic Leap comparison seems unfair, consider the fact that immediately following the debut of the new Spectacles last month, Abovitz, who is now working on a new immersive production studio startup, took to Twitter to offer his less-than-stellar quips about the device.

In another part of the chat, Gaeta finally touched upon the central issues Magic Leap had in terms of vision meeting execution.

"What is interesting and rare was that Rony's vision included sort of creating a joyous world for everyone to play in, and he was driven and motivated by similar things as, say, like a Walt Disney type character. And to me that was attractive and enough of a reason to sort of kind of attempt to help focus them," said Gaeta.

"But what I found was happening—and this isn't just Magic Leap, I've seen this happen multiple times over—is that when there are too many people in the mix, there are too many splintered visions and, just like VR, the everything platform, if you do not have focus and concentration of resources around achieving a single something, you can really be taken out and diluted and sort of break on the many many missions thing. Unfortunately, it was pervasive across Magic Leap."

There it is again: focus. This seems to be the reoccurring opinion of some who believed in the initial vision of Abovitz's version of Magic Leap and its mission.

"There were a thousand missions that all required financial resources, technical resources… I have never in my life imagined so much opportunity and business potential coming from the leaders of you name it, industry, governments, everything…incredible. To some degree, it was all left on the table. So it's a kind of a tragic story."

Thankfully, the story didn't end there, and now Microsoft veteran Johnson is at the helm working on new partnerships and forging a newly focused enterprise mission that could ultimately rejuvenate Magic Leap, especially when it releases its next hardware device later this year.