Google Venture’s Investment Strategy for Virtual Reality

Published 02 December 2015, 04:55

It isn't easy for startup companies to determine the right investment strategy to get sustainable growth. Moreover, when they choose the technology industry that had just been born. Learning from experts who have many experiences is so important. Here's investment strategy and outlook by Joe Kraus, a general partner at Google Ventures.

First of all, a little introduction if you do not know about Google Ventures. Google Ventures is a venture capital owned by Google Inc. which focus on preparing funding, from seed, venture, and growth for some startup companies in various fields of technology. The companies include Nest, Uber, Pocket, and Appurify who was recently acquired by Google.

This time, the lesson comes from Joe Kraus, one of the panel at the Virtual Reality Intelligence conference in San Francisco. Joe predicts, 2016 will become a "perceptual years of despair" for virtual reality because the market will not really give a great welcome until 2017. He said, the key for VR start-up is hold costs to survive for the next year until the market begin to take off. You can hear a recording in the audio below.


Joe also shares about VR investments that have been made by Google Venture, as well as predictions for the future of VR and AR. Google Ventures have total investment of $ 300 million for the start-up companies each year. According to Joe, during the last 14 months, Google has invested in several virtual reality companies, like Jaunt VR, High Fidelity, AltSpaceVR, Resolution Games and Emergent VR.

Joe noticed that the desktop PC market will be the main way for gamers, but mobile market will be more influential for the long term. This is because the cost required for VR mobile will be less. Quoting from Michael Abrash, VR is now seen as the "good old days," where this technology will continue to evolve. He emphasized that investing in VR now is still very important to be involved from now on.

What’s kind of investments that really important? The combination of the team, the market, and product into a mature business plan. Although it is still stuck because the market is not yet ready, but with product innovation and reliable team, should be able to survive in this industry. VR is a platform experience, the products offered must allow users may taste the VR itself.

The biggest mistake VR startups often make is they mistake novelty for value. VR is a very new platform, where a lot of people show a strong response and full of surprises in the beginning. So it is very easy to mistake when create something of sustained value.

The future of virtual reality cannot be separated from its sibling, augmented reality. Both will have their respective roles to transport users into virtual environments. Joe predict, the real spectrum brought by VR and AR may take time up to 10-15 years. His belief is based on the market demand for an amazing experience where the users can transported anywhere and see everything in real-time. If the generation of the 1990s never imagined the world can access information in his pocket, such as smartphones and Internet today here after 15 years. Likewise the next 15 years, anyone will be able to go anywhere with VR and AR technologies.


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