Google (and others) gave them so much money because ML is aiming to build a platform that is not only the thing after smartphones, it's the thing after the Web: spatialized information seamlessly interleaved with reality, everywhere.

At that time (>2 years ago), Magic Leap seemed to have achieved the holy grail of Mixed Reality: optics that selectively block out light in real-time. Combined with demos, mockups, and sketches of real-world applications, this tech provided compelling evidence that ML was going to unlock true Mixed Reality real soon.

As erikpukinskis commented, even if Magic Leap fails to deliver, it will likely end up with an extremely valuable IP in an emerging space. Magic Leap did not invent Mixed Reality, but they filed patents on many first-order applications of the tech (there are countless others).