Virtual, augmented and mixed reality have a competition problem.
But while most AR/VR companies will tell you how much better they are than their nearest direct competitor, they’re picking the wrong fight. The main event isn’t between Oculus, HTC, Sony, Samsung and Google for VR, or Microsoft, Magic Leap, Meta and ODG for AR (including mixed reality). There are far bigger and scarier competitors out there.
Digi-Capital’s new 200+ page Games Report Q3 2016 found that games investments, M&As and stock markets have delivered a massive turnaround after last year’s games deals ice age. So far this year games investments have hit $1.6 billion, mergers & acquisitions $25.7 billion, with Digi-Capital’s global games stock market index up 17% in the last 12 months. After 2015’s worst games deals market in a decade, the rebound so far this year has been unprecedented. If Netmarble’s proposed IPO ends the games IPO drought of the last 2 years, 2016 could be the largest single year for games deals in history.
Another half a billion dollars was invested into virtual and augmented reality startups in the third quarter of this year, with a record $2.3 billion dollars invested in the last 12 months. Q3 2016 saw the 9th straight quarter of investment trending upwards, as the money flowing into AR/VR is now being driven by major Sand Hill Road VCs and corporate investors. With check sizes averaging $9.3 million (or $16.4 million excluding seed deals) in the quarter, AR/VR investment is rapidly going mainstream. Details are in Digi-Capital’s new Augmented/Virtual Reality Report and Deals Database Q3 2016.
Digi-Capital’s Reality Check for October has just been announced. Reality Check is a quarterly forum for VR/AR CEOs, corporate divisional heads and VC General Partners by invitation only. It’s free if you’re lucky enough to be invited, and Digi-Capital limits the numbers to a few hundred to keep the “signal to noise ratio high.”