Immersive technologies like virtual reality (VR), augmented reality (AR), and mixed reality (MR) are redefining how consumers engage digitally with each other. As a way to connect with customers, businesses are looking to transform how they communicate and capture attention. However, as an investor, it becomes vital to know the sector and understand what the future holds.
Garrett Eastham, computational neuroscience, federated machine learning, and immersive technologies (3D/AR/VR) expert, joined us at our September 2022 roadshow to share his experience and insights on the immersive technology sector. He also talked about what investors need to look at before investing in companies in the space.
Let’s talk about immersive technology in detail:
The immersive technology ecosystem is vast and continuously evolving. The AR/VR industry is estimated to grow to at least the size of the current smartphone market. It goes without saying that customers are already enjoying immersive experiences and a lot has been possible because of investments that have allowed the market to stay in power and grow rapidly.
But now the question arises - what should an investor look into a startup using immersive technology? There are 3 crucial things that an investor should ask before writing a check:
- Distribution Channels: The biggest factor for an investor to know is how the customers are using the product and through what distribution platforms. This is similar to asking about customer acquisition which is often considered in other startups. The distribution channels can be Native App Experience and Web 3D Assets (directly used in websites). More elaborate channels such as 4D VR experiences can also be implemented. These typically include the use of higher-end VR systems like the HTC Vive, Oculus Rift, or Sony Playstation VR. A brand website or app is also a logical place to feature 360 content – even content with VR mode. This seems like such a basic move but a tactic that has been overlooked by quite a few brands who have gone through the effort and expense of creating 360 & VR content.
- Immersive Platforms: When it comes to immersive platforms, it is about understanding how the companies are actually delivering the customer experience. There are several platforms like augmented reality for mobile or using VR and XR headsets. These experiences can also feature everything from haptic vests, scent dispersion contraptions, wind machines, stationary bicycles, harnesses, and more to heighten the senses. Regardless, they are able to create high levels of immersion – what is called presence and hopefully leave users feeling more connected to a brand.
- 3D Content & Development: Finally looking at the tools and platforms the startups in the immersive tech space are using to create 3D content. This is where the investors need to look into things such as the Game engine used for creation, user experience, and platforms used to develop the 3D assets. The ‘user experience creation’ is the most difficult part as there is no end-to-end way to manage it. So, investors must look into this and understand how the company is actually delivering and managing it.
Creating A Valuable Experience:
As mentioned earlier, user experience plays a vital role in immersive products whether it is consumer-centric or B2B. If you are an angel investor, then it is most likely that the startup doesn’t have a full-fledged experience created. So how will you decide if the user experience is of value to the customer?
For Consumers: If the startup is focused on creating an immersive experience for consumers, then you should be able to see a demonstration of how it will look and feel. As an investor, you need to experience it and ask yourself if it is adding value also you can take a look at the data for products used by consumers in the trial stage before it is made available to all consumers.
For B2Bs: Immersive technology has the potential to streamline a lot of processes in business operations. So, if the product is created for B2B, then the investor must know if it is adding demonstrable enterprise value to the target corporate user. It is not just about the user experience of the enterprise as a whole who is adopting the technology but the end user who is going to actually use it.
Immersive technology has the power to influence a lot of markets including gaming, healthcare, education, art, and e-commerce. It is playing a pivotal role to enhance the user experience.
About the Speaker:
Garrett specializes in the design and development of production A.I. systems - from initial notebook to restful microservices and modularized front-end experiences, as well as the necessary teams and go-to-market planning required to scale from the first customer POC to a mature end-to-end offering. Over the past 10 years, he has played critical roles on the founding executive teams of several venture-scale organizations (FloorFound, Vertebrae, Edgecase) and has personally helped raise and deploy over $20 million of growth capital.