Essential raises USD 300 mln to help fund new smartphone

Essential, the startup run by the former Google executive Andy Rubin, has raised USD 300 million to fund its efforts to build a smartphone alternative to Samsung and Apple. The financing round valued Essential at USD 900 million to USD 1 billion, according to an analysis by Equidate, which runs a market for private company stock. Bloomberg reported the financing based on paperwork Essential submitted on the investments in late May, a few days before it unveiled its first product. The investors weren't named, and Essential declined to comment.

Essential emerged from Playground Global, a tech incubator Rubin formed after leaving Google in 2014. The new financing round created a separate class of shares with more voting rights, suggesting Playground Global has considerable control over Essential, according to Equidate's analysis. 

Before the latest financing, Essential raised USD 30 million from Playground Global and Redpoint Ventures last year. Other investors include venture firm Altimeter Capital, Tencent Holdings and Foxconn Technology Group, according to the Essential website.

Rubin also went to SoftBank and negotiated a deal to include Essential in the Japanese firm's nearly USD 100 billion technology fund, but the investment was scrapped after Apple joined the fund, according to a report in the Wall Street Journal. At the Code technology conference last week, Rubin confirmed the SoftBank talks and said the deal didn't happen because another investor that was a potential rival joined the fund and would have become an Essential backer.