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Investors Seeking Out AR Opportunities According To Report

A new report from Digi-Capital shows that investment in virtual reality (VR) and augmented reality (AR) sectors is currently in a trasition period between a market that was primarily focussed on high-end VR to one driven by the AR mobile sector.

The report shows that over the past twelve months to Q3 of 2017 a total of $1.8 billion (USD) was invested in the 27 AR and VR sectors covered by the report. $300 million of that total was raised in Q3. Though some analysts may point out that is a drop from Q2 2017’s $800 million total, Digi-Capital emphasise that the Q2 figure was an outlier, since it was the result of two unusually large deals in Q2.

Across the various sectors, technology account for $4 out of every $10 invested, with videogames accounting for $1 per $10 invested. Other high-value investment areas included smartglasses, peripherals as well as social and entertainment applications. Smaller areas of investment included education, location-based VR, advertising, navigation, art/design, medical, sports and education.

Tim Merel, Managing Director AR/VR advisor Digi-Capital said: “Softening VR sentiment in the first half of 2017 also reduced the number of active AR/VR investors, but mobile AR seems to be reversing that effect. It isn’t clear yet whether resurgent VC/corporate investment interest in mobile AR will also help smartglasses, premium VR or mobile VR startups doing the rounds on Sand Hill Road. Where ARKit, ARCore and Camera Effects will have an installed base over 900 million by the end of 2018, it could take mobile AR startups another 12 months to scale in revenue terms. This means that VC and corporate investors will need to be realistic about the early stage mobile AR market, requiring patience while new portfolio companies build towards dominant positions.”

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