The rise of virtual reality (VR) and augmented reality (AR) has presented a golden opportunity to many startups and small businesses. With many larger, established companies adopting a ‘wait and see’ stance with regards to immersive technology, this has given startups a chance to shine. A new report shows how this has been working out, with AR/VR startups raising a great deal of capital.
The new report from Digi-Capital shows how startups in the AR and VR areas have benefited from money from venture capitalists and venture corporate interests.
Data gathered shows that AR and VR startups raised over $3.6 billion (USD) in the past 12 months, a record-breaking figure according to Digi-Capital. Over three-quarters of a billion dollars was invested in the first three months of 2018 alone.
Some of the biggest money injections went to companies such as Magic Leap, Niantic, Improbable and Unity. The AR sector has seen the biggest increase in cash flow since the start of 2018, while VR startups have begun to face more difficulties.
Digi-Capital’s report indicates that AR has begun outpacing VR in terms of number of deals made. Mobile AR is in its early stages, and dominant companies are still emerging as companies learn what does or does not resonate with the audience. Digi-Capital has forecast that mobile AR investment will not truly take off until 2019.
According to the report, AR and VR videogames remained the largest sector for investment, drawing over 10% of the total deal volume, with the rest spread across growth areas including peripherals, advertising, medical, health and fitness, news, sports, music and video.
The report also forecasts that a large scale market for smartglasses in both consumer and enterprise spaces has not yet begun, but anticipates that Apple will launch its own smartphone-tethered smartglasses by 2020.