In the seemingly never-ending saga of companies believing that, despite generating no real revenue, they're worth some multiple of an Instagram, Cyanogen Inc. is reportedly seeking additional funding on the basis of a $1 billion valuation. This apparently comes on the heels of talks with Google's Sundar Pichai, who expressed interest in acquiring Cyanogen, presumably to become part of Google's Android group.
Cyanogen has allegedly been using this offer as a form of leverage in negotiations for funding, which of course they have, because who wouldn't use that as a way to convince investors your not-profitable company is worth throwing large sums of money at?
Cyanogen Inc. has yet to produce any consumer products beyond its partnership with Oppo and OnePlus, both of which have seen a negligible increase in the number of people actually using CyanogenMod, which does remain the most popular Android custom ROM on earth. Cyanogen Inc. has differentiated its corporate-produced, manufacturer-sanctioned ROM from its traditional releases by adding an "S" to the release number, with the current version known as CyanogenMod 11S.
The Information goes on to claim that Cyanogen Inc. has a deal with Indian Android phone manufacturer Micromax to release a CM-powered handset as soon as the end of the year, though the exact timing isn't yet known. Micromax is an extremely popular brand in India, and is a launch partner for Google's Android One initiative. Cyanogen partnering with Micromax on its own device is undoubtedly stepping on some toes - Android One is almost certainly a pet project of Google's Sundar Pichai, and a cheap CM phone in India could be a disruptive force to Google's own offerings, even if the chance of it seriously catching on seems fairly low.
Stating what we'd all probably assumed, the article confirms that Cyanogen Inc. has yet to generate any real revenue, and still hasn't made good on promises to launch value-added "services" to lay out a real business model for the company. Part of Cyanogen's business model in the works are paid themes, which sound exceptionally dubious as a serious way to make money, but who really knows - maybe it could work. Cyanogen Inc. is also allegedly offering better revenue sharing opportunities than Google with prospective partners; granted, in order to share revenue you actually have to create some.
For now, Cyanogen Inc. seems like almost every other startup out there: trying to hype-fund its way into an unrealistic valuation only to later be acquired and make everyone with a stake in the company rich. After which most of said important people will probably quit and go on to do something else.