Real money goes into virtual and augmented reality

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While a great many people are only vaguely aware of something called ‘virtual reality’ or ‘augmented reality’, off the charts investment figures of the last couple of months point to a technology that is on track to penetrate every strand of the fabric of life in the near future. Money talks and if you look at where the money is going, vague awareness will soon be replaced by sure knowledge and direct experience. Venture capitalists invested a record amount in AR and VR startups in the fourth quarter of last year, according to data from CB Insights. All in all 43 deals were struck which raised a total of $238 million. Notable deals in that quarter included investments in Asian VR startups ANTVR ($4 million Series B) and DeePoon VR ($30 million Series B), as well as the $30 million Series A raised by NextVR.

A new report from Digi-Capital puts the total figure invested in AR and VR in 2015 at a record $686 million with six straight quarters of growth in the sector.

According to the report, cash has been flowing into sectors where investors see both short- and long-term opportunities, including AR/VR video, games, solutions/services and both AR and VR head-mounted displays

The expectation is that the investor base will move to the broader VC and corporate investor base, towards a mammoth growth of $120 billion by 2020. At that time most of the income from AR/VR is expected to come from Asian countries like Japan, China and South Korea.

Facebook with its $2 billion acquisition of Oculus and Alphabet through Android OS and Google Cardboard are seen as forerunners in the virtual reality race.

The highly-anticipated arrival of VR headsets like Facebook’s Oculus Rift and HTC and the HTC Vive  is helping to turn 2016 into the year for VR. Many global conferences and other venues are giving the public opportunities to have immersive experiences, taking the technology from the confines of the gaming fraternity to the public at large. We are getting our first taste of a new “reality” that will soon be very much part of our lives.