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June 2017 / Issue #2

Virtual Reality
Is it hype or is it the future?

www.thehutchreport.com Insights, Ideas and Tools for the New Economy

INTRODUCTION AND
HISTORY OF VR
This is by no means the first
appearance of virtual reality. It
has actually been around since
the 1950’s. Every so often the
dream of experiencing a virtual
world is revisited. We are now
back here again.

SWOT ANALYSIS
We look at the internal strengths
and weaknesses of the virtual
reality hardware currently being
marketed to the public. In
addition, we analyze the potential
opportunites that could help the
industry flourish or the threats
that could once again derail its
development.

MAJOR PLAYERS
AND SMALLER
STARTUPS
We have identified the major
players in the value chain in
addition to some dynamic startups
making noise in different areas
with their virtual reality
applications and those to
definitely keep an eye on!
The Hutch Report was founded in 2015. Originally from North America, the
founders have lived in Europe for the past 20 years and traveled some of the
most amazing places that the world has to offer. In that time, learning some
incredible things and living an incredible adventure.

Along the way we have met a large number of fascinating people and worked
with more than a few technology startups, one which was sold to PayPal and
another that was sold to Macrovision. In that time we have compiled an
extended network of contacts in the European and North American startup
communities as well as the venture capital and private banking sectors.

Through research, interviews and analysis we are out to discover next great
opportunities, investments and nuggets of knowledge. As we go through this
process we thought it would make sense to share our insights, ideas and tools
for the new economy so our readers can profit along with us. All of the content
posted on our website, in the blog and in our feature reports, is unique and
original. Our work has appeared on Zero Hedge, as well as other widely read
sites. The Hutch Report is frequently engaged by a variety of organizations
including hedge funds for industry insights as well as directly by a broad range
of companies for marketing consultancy and competitive analysis.

If you would like us to cover something special please feel free to use the
contact form or drop us an email as noted on the contact page. Any other
feedback, comments and suggestions are also welcome. You can contact us at
info@thehutchreport.com.

For more content and exclusive downloads, visit


www.thehutchreport.com
editor's note

Welcome to our second report. This time we delve into


the world of virtual reality. The idea is not new and has
in fact been around since the 1950s, however as
technology has advanced and become more
sophisticated the desire to revisit the possibility of a
virtual world has once again returned.

Since Facebook decided to acquire the headset


manufacturer, Oculus, the industry picked up steam. A
large number of startups suddenly appeared with
promises of a future we have only seen in movies.

Although the technology opens up the possibility of


completely new kinds of experiences, it is also playing
with our senses. We wanted to take a closer look at all
the potential opportunities as well as the threats that
could derail the promise of virtual reality yet again.

The Hutch Report


Team
Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Introduction
Virtual Reality (VR) is nothing new. The term applies to a visual,
sensory and auditory experience that mimics the real world, or
imagined worlds. It is considered as immersive entertainment.
Even though today’s media hype would leave you to believe that
it is something new, it has in fact been around for many years
already.
As with any technology VR has been the result of many sources
of innovation and development over the years. It’s origins can be
traced back to Morton Heilig in 1957, who along with his partner
developed the Sensorama and produced the first interactive film
experience where an individual could use all their senses. The
Sensorama was big, bulky and shaped like a 1980’s style video
arcade game. Because of the high costs of the filmmaking and
the business community not being able to sell it, the Sensorama
did not last.
Ivan Sutherland is credited with creating the first head mounted
1957 Sensorama display (HMD) which was attached to a computer system. The
HMD closely resembled a portable television and could not be
comfortably worn by a person. It had to be supported by a series
of cables attached to a metal stand which enabled the person to
wear this and move around in safety. In 1965, Ivan Sutherland
tried to mimic the physical world with the use of his invention.
He called it Ultimate Display.
Next came Douglas Englebart whose work with virtual reality
helped to shape the future of user interaction via that device
which accompanies a standard computer keyboard – known as
the mouse in, 1967. This also laid the foundation for the
development of modern user interfaces.
During the 1980s, virtual reality was used on projects for NASA
as well as research into new forms of human-computer
interaction (HCI). This was carried out by Dr Michael
1965 Ultimate Display McGreevy, an authority in this field and who developed some
very innovative virtual reality systems.
The 1990s saw the first widespread commercial releases of
consumer headsets. In 2001, SAS3 or SAS Cube became the first
PC based cubic room. By 2007, Google introduced Street View, a
service that shows panoramic views of an increasing number of
worldwide positions such as roads, indoor buildings and rural
areas. It also features a stereoscopic 3D mode, introduced in
2010.
By 2016 there were at least 230 companies developing VR-
related products. Facebook has 400 employees focused on VR
development; Google, Apple, Amazon, Microsoft, Sony and
Samsung all had dedicated AR and VR groups.
So what has changed? The technology has come a long way
since the inception of VR, however, the key denominator
1967 Mouse required for staying power is still the percieved value to the
consumer and will it be enough to convince them to adopt this
new experience into their daily lives.

© The Hutch Report 2


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

VIRTUAL REALITY VS AUGMENTED REALITY


Virtual reality (VR) and augmented reality (AR) have different use cases, technologies, and
market opportunities so it is important to highlight the differences between the two.

Virtual reality immerses a user in an imagined or replicated world (such as videogames, movies, or
flight simulators) or simulates presence in the real world. Examples of hardware players in virtual
reality include the highly mediatized Oculus, now owned by Facebook, Sony PlayStation VR,
HTC Vive, and Samsung Gear VR.

Augmented reality overlays digital imagery onto the real world. Examples of hardware players in
augmented reality include Microsoft HoloLens and Google Glass.

The difference between the two is straight forward. VR uses an opaque headset (which you cannot
see through) to completely immerse the user in a virutal world as opposed to AR which uses a
clear headset so the users can see the real world and overlay information and imagery on to it. We
recently saw an excellent example of AR with the success of the game Pokeman Go, although for
various reasons its user base is in decline.

For this reason we can see how VR could be geared more towards consumer entertainment
applications whereas AR would be more applicable to a wider spectrum of business and enterprise
use cases, although some of them could very easily overlap each other.

Both areas are fully dependent on having the technology deliver all the promises, however the
greatest challeges to both would be convincing the market that the value proposition is high
enough to invest in yet another electronic device.

In this report we concentrate soley on the virtual reality space, however, some of the companies
mentioned are present in both the VR and AR markets. Our goal is to simply identify many of the
talked about issues regarding hardware, software, current use cases, and value propositions. It is
not our intention to forsee the future. It is up to the reader to consider for themselves which area
could have the greatest impact and chance of viable commercial success.

Because of the large number of media publications who seem to be certain of their abilities to
fortell the future, we have included a bit of a writeup that describes the condition of “forecast
illusion,” which we have all been a victim of, but something that should be avoided.

In this Hutch Report we present a SWOT analysis for the field of VR. SWOT is an acronym that
stands for strengths, weaknesses, opportunities, and threats, and is a commonly employed
framework in the business world for analyzing the factors that influence an entity’s competitive
position in the marketplace with an eye to the future from a neutral point of view. Here we will
look at the internal strengths of this immersive technology as it exist today in addition to the
current weaknesses confronting the latest technological advances. We also analyze the external
threats to the development of VR in the marketplace and the opportunities that could help propel it
forward.


© The Hutch Report 3


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

SWOT ANALYSIS

VR Strengths
Immersive aspect
VR provides an opportunity for advertisers to focus the consumer’s attention in an entirely new
way in comparison to today’s world where multiple sources are pulling a viewers focus in any
number of directions. With virtual realiy, viewers are totally immersed in the experience—
whether it’s through a mobile device viewed through cardboard or a more advanced headset,
people are totally focused on the message.

Increased efficiencies in the business world


This technology is an asset because users in any industry can test its products without actually
using raw material and increases the success rate of achieving their end goal. For example,
manufacturing companies can shape and fit parts together before production. By doing so,
organizations may only need one version of a prototype and can make changes without creating
a whole new one. This is significant to organizations because trial time and resource waste can
be greatly diminished, vastly reducing the costs of development. Problems can also be
recognized and addressed at earlier stages of the development process before they are too costly
or time consuming to fix.

Enhance the life of individuals


VR would open up a number of options allowing isolated people like the elderly to participate in
communal dining with others online. In addition, it could also be used to encourage exercise by
creating virtual worlds that demand movement while allowing people to forget that they are
actually exercising.

New experiences and emotions without the danger


A consumer could be transported and experience floating in outer space or driving a car 200
miles an hour on a race circuit without worry about the inherinet dangers of doing that in real
life. The average public could experience the emotion of being at the top of Mount Everest, or
experiencing being in the center of a war. Emotionally this could create greater levels of
empathy and change many points of view on many subjects when a consumer is able to
experience it first hand. It could be possible to be transported to the middle of a natural disaster
and all the emotions associated with it.

© The Hutch Report 4


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

VR Weaknesses

Unknown health concerns


The more people experience VR the greater number of health concerns are beginning to be
associated with it. It seems that VR is making people ill in a way no one predicted. And as hard
as it is to articulate the effects, it may prove even harder to identify its cause.

It is difficult to perform long-term analysis of extended use of possibly hazardous devices. One
concern about using head based displays with cathode ray tube mounted on the side is the
possible long-term effect of having high-voltage electromagnetic devices near the brain for
extended periods of time.

Physical side effects


People who are strapped into a fully occluded device cannot see anything around them, creating
obvious physical dangers.

VR can have neurological effects because of its realistic simulated motion. "Simulator sickness"
is a condition suffered in flight simulations. Virtual Reality Sickness or Cybersickness has been
around since the beginning of virtual reality. The incongruity between depth perception cues
causes conflict in visual perception. This conflict leads to headaches, nausea and motion
sickness, and although Oculus has worked hard to alleviate motion sickness it still exist.

In addition, eye mechanism mismatch has become a cause for concern because after about an
hour of immersion users have stated that it was common to feel tired from exertion. Healthcare
professionals warn that the idea of suspending a display an inch or so from your face for hours
and hours is bound to create problems. Currently, virtual reality safety manuals recommend
taking breaks frequently.

Interviews with sales personnel at demo booths indicated that there were numerous customers
not feeling well after use, and in fact many of the sales people experienced the same issues.

Psychological side effects


Virtual reality involves complete immersion in a fully imagined environment. Large percentages
of people are experiencing stress or anxiety after wearing a full occlusion headset for more than
a few minutes.There is also a potential loss of integration with reality which in turn leads to
addiction.

Discomfort
Many of the current forms of head-based displays, are not easy to put on or wear, making them
impractical for many applications. They are additionally not concieved for people with glasses
making them that much more uncomfortable. It is necessary to adjust the fit of the headset,
which requires tightening or loosening straps, plus fixing focal distance or even eye distance.

© The Hutch Report 5


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Safety
The goal of VR is to transport us into another reality, however in order to experience that reality
it requires our senses. It requires our auditory, visual and touch senses. If these senses are serving
us in a virtual reality world they are not protecting us in the real world. Motion-sensing VR
systems involve standing, ducking, swinging your arms, and sometimes walking. Doing all this
with a headset on your head that blocks vision and sound can and has already caused many
accidents.

Scott Stein of CNET.com had the experience when he did some demos for his article, “The
dangers of virtual reality,” - Mar. 2016. He writes, “In prepared demo rooms, where extensive
steps are taken to be safe -- and there's almost always a staffer standing right behind me making
sure I don't slip or trip -- they still happen.

There has been a recent increase of videos that have caught real life accidents of people falling
and hitting things while experiencing virtual reality. In one example, Bryan Clark, writing for
TNW describes an incident where a user trying out an Oculus headset, while climbing up a
virtual mountain, had an unexpected fall — both in-game and in real life. He fell into the
companies promo sign then onto the floor. The fall was a minor one but the spill does outline a
significant danger for virtual reality in that it might sometimes be too immersive.

Restricted movement tradeoff


Until recently VR headsets required cables thereby restricting the amount of free movement by
the users. There are now a variety of wireless headsets hitting the market. Of course, the barrier
to create these headsets is lower than those running on PC, and the experiences won't compare to
headsets hooked up to powerful GPUs. That's one of the biggest trade-offs: freedom of
movement or improved graphics, until the technology allows for both. However, without wires
the headsets also require a battery and typical wireless systems such as WiFi cannot support the
required data rates. Moreover, the strict latency constraints on VR systems (about 10ms)
preclude the use of compression/decompression to accommodate lower data rates. So, wireless
headsets that make the grade are still not a done deal.

Headsets limit the amount of social interaction possible during streaming


Although there is great hope for virtual reality in live streamed events, at the moment the user
would not be able to interact with a group of friends or crowd as we do now.

© The Hutch Report 6


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

VR Opportunities

Broad field of use


Virtual reality addresses many potential markets - Training and Education, Entertainment and
Gaming, Help and Healing, Architecture and Planning to name a few. Since virtual reality
mimics the real world, such technology can be used to improve many activities such as gaming
experiences, virtual prototypes (ex: cars), training programs for the military, medical training
(ex: surgical procedures and diagnosing), psychological therapy, training astronauts, and many
more.

Big interest in VR
Where there is hype, there is more media attention. Where there is more media attention, you get
a greater amount of hype and interest. Whether the industry and products live up to that hype is
another story. For now however, VR has a strong and loyal fanbase amongst gamers, which
make up the largest number of users. In addition, there is no lack of funding and investment
being thrown at this industry. The first half of 2016 alone saw $1.3 billion invested in funding,
acquisitions and mergers.

Attracting a new remote audience


Sports and entertainment events in VR represents a compelling new way to develop audiences
remotely, by offering consumers the best seats in the house. With VR, the content publisher
could bring a fan closer to an artist than they ever could be in real life.

Prices are coming down


VR is now becoming commercially accessible — a full-immersion kit with motion controllers is
less than $1,000. With further investment and advances in technology we can expect these prices
to continue to drop.

© The Hutch Report 7


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

VR Threats
Consumer adoption and scale
Unlike the virtual-reality fad that fizzled 15 years ago, supporters say that today’s version of VR
technology, backed by the likes of Facebook, Google, and Samsung—is going to be big.
However, with this kind of enthusiasm and media attention it is likely to create unrealistic
expectations. Although it is possible that many consumers may be impressed by the experience,
there’s an equal chance that they may have a more upsetting, nauseating experience. Negative
first impressions could confirm any existing skepticism and keep consumers away for years.

Although VR has promise for business, for the moment most customers are gamers. VR game
users reportedly engage in 40 sessions a month on average. Aside from the gamers, most people
lack a compelling reason to pay the price for the gear. Research firm Magid says that while
interest in music and virtual travel is growing, there’s a “lack of clear value proposition besides
early adopter enthusiasm.”

There was an indication of this in the sales figures for 2016. The VR industry shipped 6.3
million devices amounting to $1.8 billion in revenue, according to research firm Super Data,
however that was below expectations.

Ethical Challenges
Concerns have been raised about a possible relationship between virtual reality and
desensitisation. This refers to virtual reality games in which there are high levels of violence.
This could also be found in VR training exercises for the military in which soldiers engage in
simulated combat scenarios which include killing.

Desensitisation means that the person is no longer affected by extreme acts of behaviour such as
violence and fails to show empathy or compassion as a result. In some situations they actively
seek out this type of scenario for the adrenaline rush and sense of power. This has already been
noticed with gamers, especially those who play first person shooters or role playing games which
involve a high degree of immersion.

More and more companies are using this virtual reality as a form of shock treatment to create
awareness. Diageo’s project, “Decisions,” challenges people to think twice before allowing
themselves – or others – to get behind the wheel after drinking. Through the use of 360° virtual
reality, users can experience an alcohol-related crash head-on. Participants witness the crash
through a passenger’s point-of-view, reinforcing a bystander’s power in preventing tragedy. This
educational tool lets users see, hear, and feel a car crash first-hand—from start to finish.
However, there is a possibility that this could backfire and people end up becoming desensitized,
as many have to the images of killing and violence that dominate the TV airwaves.

Another issue related to ethics is that of addiction. There are people who become addicted to
virtual reality games and as a consequence, start to blur the boundary between real and virtual
life. They spend increasing amounts of time in the virtual environment which has a detrimental
effect on their real world life.

© The Hutch Report 8


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

The online magazine Vice, writes, “Naturally, the porn industry has been quick to see the
potential of VR, with fully immersive videos already available for the most budget of headsets.
Porn addiction is no laughing matter, with affected known to suffer from depression, decreased
productivity, and experience significant financial problems. Brooklyn Nine-Nine actor Terry
Crews opened up about his addiction in early 2016, and his words made for uncomfortable
reading: "If day turns into night and you're still watching, you probably got a problem." Crews's
addiction almost wrecked his marriage. And VR porn, in an immersive, first-person experiential
sense, has the potential to be even more addictive, and perhaps even preferential, over real life,
precisely because it has no limits. Many more real-life relationships could be abandoned in favor
of plugging in each time sexual gratification was required.

Legal exposure
Where there are ethical concerns, there are lawyers. For this reason, the industry could be opened
up to lawsuits stemming from any adverse effects that the consumer may get from using VR.

High cost
The high cost of VR represents another threat to growth. Currently, the target market for PC-
based high-end systems—like Oculus Rift and HTC Vive—is the hardcore gamer that’s willing to
spend over a thousand dollars to experience fully-immersive VR. The question many have raised
around costs is whether smartphone-based VR can evolve to become more competitive with PC-
based experiences that require much more powerful hardware, software, and a faster internet
connection.

Social stigma of a closed experience


There is a social stigma that can arise from a situtation where people find themselves isolated
from the rest of the population with a large helmet on their heads. Would consumers be willing to
wear these headsets in public settings and how would they be viewed by others?

Virtual reality as a new medium


Existing video assets of publishers, advertisers, or 2D gamers cannot be repurposed to work in a
virtual reality environment. Therefore, any company willing to enter the market will have to take
on the risk and invest in completely new content. The quesion is will they do this if hardware
sales are lagging. Publishers can’t be certain of an addressable market so if the requirement of an
installed user base of VR hardware devices is necessary before publishers will invest in new
content, it turns into a chicken and egg scenario.

Poor PR
There has been much written on the prospects and possibilites of virtual reality, however there has
also been ongoing typical media reports of addiction and health concerns regarding VR. This
could inturn hinder adoption rates as it did in the 1990s.

Monetization Challenges
Despite the fact that VR technology is improving and hardware is becoming cheaper and easier to
access, there is a concern that the current rate of adoption could lead to monetization challenges.
The current audience is limited and sales vs forecasts in 2016 have been dissappointing.

© The Hutch Report 9


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

MAJOR PLAYERS
Hardware - Stand-alone Headsets
We have included the leading headsets in pure virtual reality and not augmented reality, of which
there are many, or mixed reality such as Microsoft’s headsets which are being manufactured by
Acer, Asus, Dell, HP and Lenovo for use with Windows PCs.

Facebook/Oculus VR
https://www.oculus.com
(NASDAQ: FB)

The current leading VR company in terms of name recognition is Oculus. Oculus became so
popular that Facebook paid $2 billion for a product that had not even been shipped. Oculus got
major game developers on board early, hence its lead in the VR headset space, but it's finding
business uses. For example, Marriott Hotels is using the Oculus Rift headset as a way to showcase
distant hotels to potential guests. The headsets began shipping on March 28, 2016 for $599.
However, after less than expected sales figures Mark Zuckerburg stated recently that the market
should not expect profitability in this sector for quite a while.
May 5 Update - Oculus VP of Content Jason Rubin announced today that the company will shut
down its award-winning cinematic VR division, Oculus Story Studio. “After careful consideration,
we’ve decided to shift our focus away from internal content creation to support more external
production,” Rubin wrote. “As part of that shift, we’ll be winding down Story Studio.”

Sulon Q
http://www.sulon.com
Total Equity Funding - Not available

AMD has partnered with Sulon Technologies to produce the Sulon Q. It is the first and only
headset that can handle both virtual and augmented reality applications — every other headset so
far can only handle one or the other. More importantly, the Sulon Q doesn’t need a computer to
power its experiences. Everything is built right into the headset.

HTC Vive
https://www.vive.com/eu/
(Taiwan SE: 2498:TT)

Taiwan-based smartphone company HTC Corp are behind Vive, a complex system of a headset.
There are two hand-held devices and sensors that you place around your room so it can track your
movements. HTC partnered with Valve to create “room-scale" games, so you don't just sit on the
couch to play the game, you get up and move around. The box comes with 16 different
components which makes for a bit of a complicated setup.

© The Hutch Report 10


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Sony Playstation VR
https://www.playstation.com/en-us/explore/playstation-vr/
(NYSE: SNE)

PlayStation VR, known by the codename Project Morpheus during development, is a virtual
reality head-mounted display developed by Sony Interactive Entertainment, which launched on
October 13, 2016. It was designed to be fully functional with the PlayStation 4 home video game
console. SuperData Research estimates that there were 243,000 Oculus Rift units sold through the
end of 2016, and 420,000 HTC Vive units. If the real figures are reasonably close, that makes
Sony, with sales of 1 million headsets, the leading VR maker on the planet despite having a
smaller amount of time to build its user base.

StarVR
http://www.starvr.com
(STO: STAR-B)

Starbreeze has formed the Project StarVR, where InfinitEye’s hardware expertise and capabilities
are combined with Starbreeze game and entertainment software development skills. Aiming to be
the leading solutions provider of B2B Virtual Reality services, StarVR Corporation innovates the
head-mounted display market through its 210-degree, 5K resolution VR headset. StarVR
Corporation is a joint venture between Swedish entertainment content creator, publisher and
innovator Starbreeze Studios, and Acer, one of the world's top ICT companies with presence in
over 160 countries.

Fove
https://www.getfove.com
Total Equity Funding
$11.1M in 3 Rounds from 7 Investors, Most Recent Funding: $11M Series A on March 7, 2016

FOVE offers an eye tracking head mount display. Fove gets its name from "foveated rendering,"
which is a technique used to render scenes in only the area where the eye can see. This, Fove says,
is vastly more efficient than having to render the scene over a large area. It improves performance
significantly and reduces strain on the system, according to the company. It also means that unlike
other headsets such as the HTC Vive or Oculus Rift, you could use the Fove with lower-end PCs.
The Rift's recently announced Spacewarp technology allows for this as well, but Fove CTO and
co-founder Lochlainn Wilson says the company still has the Rift beat when it comes to sharpness
and quality: The Fove's display has a resolution of 2,560 x 1,440 while the Rift's is 2,160 x 1,200.

© The Hutch Report 11


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Avegant
https://www.avegant.com
Total Equity Funding
$48.93M in 4 Rounds from 10 Investors, Most Recent Funding: $13.7M Series B on April 17,
2017

Avegant's virtual reality glasses aren't quite like anything else on the market. For one thing, they
don't use the same magnified screen technology as Oculus, Samsung, and most other companies.
Althought they are slightly more geared towards mixed reality than true virtual reality.
They use a virtual retinal display, projecting images directly on your eyes; it's a technology that's
been around since the '80s, but it's rarely found in consumer headsets. And instead of goggles, they
look like headphones. In fact, they are headphones — they just tip forward onto your eyes if you
want to use them as a headset.

Magic Leap
https://www.magicleap.com/#/home
Total Equity Funding
$1.39B in 3 Rounds from 15 Investors

Magic leap is more mixed reality than virtual reality but an important player in the space so we
have included them. Magic Leap is a proprietary wearable technology that enables users to interact
with digital devices in a completely visually cinematic way. They make a head-mounted virtual
retinal display, which superimposes 3D computer-generated imagery over real world objects by
projecting a digital light field into the user's eye. This allows for placing 3D objects in the user's
field of vision of the real world instead of a 100% virtual vision like other headsets. Magic Leap
has raised a record-breaking amount of money for a VR company; in December 2015, it raised
$827 million in Series C funding, and in February it racked up another $793 million, the largest
amount of funding for a startup ever.

© The Hutch Report 12


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Hardware - Accesory Headsets


Google
https://vr.google.com/cardboard/
(NASDAQ: GOOGL)

In comparison to the current choice of expensive headsets on the market, made of hefty plastic,
rubber and metal, Google has a $15 headset made of cardboard called, Cardboard. Cardboard. It is
designed specifically for using VR apps on Android smartphones. As opposed to Oculus, Google
doesn't develop software, instead, it encourages developers to make and sell VR apps for Google
Play. Its main objective for the moment is to develop games.
In addition, Google has introduced Jump, their professional VR video solution. Jump makes
3D-360 video production at scale possible with best-in-class automated stitching. Jump cameras
are designed to work with the Jump Assembler to enable seamless VR video production.

Samsung Gear VR
http://www.samsung.com/global/galaxy/gear-vr/
(Korea SE: 005930:KS)

Another current VR leader is Samsung . Their product Gear VR was designed with Oculus as a
consumer device for $199, and it works with the newest generation of Samsung phones. A holder
on the headset allows you to slide a Samsung phone into the headset where it acts as the compute
device.

Proteus VR Labs
https://www.freeflyvr.com
Total Equity Funding
$250,000 Seed on Jun 1, 2014 at a $1,000,000 valuation

Freefly VR is a trademark from Proteus VR Labs, a company founded in 2013, dedicated to


designing immersive, highly engaging virtual reality products. Freefly VR’s foundations are built
on a high 120-degree Field of View and extended comfort, with a nice faux-leather finish. The
Freefly VR comes in a hardshell case with a wireless controller and is usable for a large range of
smartphones.

Homido
http://www.homido.com
Total Equity Funding
Unknown

The Homido Virtual Reality Headset is a headset that's been designed to accept any smartphone
you can fit into the front. It works on the same system as Google Cardboard, i.e., it has two lenses
inside and you view the smartphone you slot into the front displaying content designed for VR.
The plastic construction means that this is a little more like Samsung's Gear VR than Google's
cardboard solution, however, Samsung's solution will only work with Samsung phones. Estimated
Revenue: $472K

© The Hutch Report 13


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Visus VR
https://www.visusvr.com
Total Equity Funding - Unknown
The VisusVR system takes a unique approach that takes the best options from both the virtual
reality options of accesory and standalone headsets. The HMD accepts your smartphone as the
display, which reduces the cost of the unit significantly. But it's the PC that runs the game, which
the designer - quite rightly - suggests is far better equipped to run a side-by-side 3D virtual reality
game. A video feed is sent to the smartphone, so the handset isn't laboured with running the
software, thereby reducing latency.

Razer
https://www.razerzone.com
Total Equity Funding
$125M in 3 Rounds from 4 Investors

Razer develops high-end precision gaming products by combining technology, ergonomics, and
expert validation. Founded in 2005, Razer is backed by Intel Capital, IDG-Accel and Heliconia
Capital Management (Heliconia), a wholly owned subsidiary of Singapore investment company
Temasek. Razer and Sensics, announced the OSVR (Open Source Virtual Reality) initiative
alongside the $199 ‘Hacker Dev Kit’ VR headset. The VR headset from Razer, was designed with
the help of Sensics a company that’s been working in the world of professional head mounted
displays for more than 10 years.

There are still a number of other headsets under development and currently struggling to launch
onto the market, however they can be supported through their crowdfuning campaigns. These
include the following: https://cmoar.com, https://usens.com, http://pinchvr.ca

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Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Hardware - Controllers
Oculus Touch
https://www3.oculus.com/en-us/touch/

Oculus Touch is made by Oculus, owned by Facebook. They have developed motion-tracked input
controls for use with the Rift platform.

Leap Motion
http://www.leapmotion.com
Total Equity Funding
$44.05M in 5 Rounds from 9 Investors, Most Recent Funding: Venture on October 8, 2015 /
Undisclosed Amount

Leap Motion is a software and hardware company developing 3D motion-control technology for
virtual reality and additional platforms. Leap Motion's hand tracking lets the user reach into virtual
and augmented reality to interact with new worlds. The company is currently partnering with
major VR manufacturers to embed Leap Motion technology into mobile VR/AR headsets.
Estimated revenue: $30M

Virtuix Omini
http://virtuix.com
Total Equity Funding
$16.08M in 6 Rounds from 15 Investors, Most Recent Funding: $7.7M Equity Crowdfunding on
August 1, 2016

Virtuix is the developer of the Virtuix Omni, a virtual reality platform that enable users to walk,
run, and jump in 360 degrees in VR. The base of the Omni is a grooved, low-friction surface.
Special shoes keep the foot stabilized and prevent lateral sliding. Users walk naturally—and the
result is a natural interface that works with any game or application that uses keyboard input.
Walk, run, jump, or strafe—movements mapped to the keyboard can be mapped to natural motion
with the Omni. Estimated revenue: $1.6M

Nod
https://nod.com/
Total Equity Funding
$16M in 2 Rounds from 6 Investors, Most Recent Funding: $13.5M Series A on June 16, 2015

Nod is a gesture control ring developed by Nod Labs. Nod can be used as a Virtual Reality input
device. This wearable device is worn on your index finger. User can even wear two at a time, one
on each hand. Equipped with sensors, processors and a Bluetooth antenna, the ring allows its user
to control and interact with various devices, such as a smartphone or VR HMD, by waving,
pointing and gesturing with his or her finger. The Nod Ring was released in Fall 2014 for 150
dollars. Estimated revenue: $8.9M

© The Hutch Report 15


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

VirZoom
http://www.virzoom.com/
Total Equity Funding
$4.38M in 1 Round from 3 Investors, Most Recent Funding: $4.38M Convertible Note on
December 31, 2016

VirZoom turns a stationary bike into VR controller. Integrated sensors in the bike track the
pedaling speed forward and backward. Triggers and buttons are built into the grips to take air, get
bursts of speed, and blast away obstacles. You must have your own VR system to play VirZOOM,
but it is compatible with all major systems with head-position tracking. Estimated revenue: $8M

Cyberith
http://www.cyberith.com
Total Equity Funding
$1.24M in 2 Rounds, Most Recent Funding: $1.1M Seed on March 1, 2015

Cyberith GmbH, based in Vienna, Austria and Redwood City, California, develops a line of patent-
pending, award-winning Virtual Reality solutions that deliver a fully immersive virtual experience.
These solutions include input and feedback hardware and software components that enable users
to interact with virtual environments and also address the issue of motion sickness especially in
first person applications. Their product The Virtualizer, is an omni-directional Virtual Reality
treadmill that allows the user to walk through any kind of virtual environments. Estimated
revenue: $69.5K

Sixense
http://sixense.com
Total Equity Funding
Sixense completed a Kickstarter campaign which ended with around 2,300 supporters and
$600,000 in funding.

The STEM System™ is a wireless, modular motion tracking platform for video games, virtual
reality (VR), and more. Sixense's STEM (Sixense Tracking Embedded Module) goes one step
beyond the usual headset to offer a headset with hand-held controllers and a central base station to
create an electromagnetic field with an 8-foot radius. Unlike a camera-based motion tracker like
Microsoft's Kindle, it detects the movement of the hand-held sensors for immersive gameplay. The
STEM system is a developer kit for now, and it is available for other companies to license.
Estimated revenue: $10M

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Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Development - Cameras/Platforms
Nokia OZO
https://ozo.nokia.com/vr/
(NYSE: NOK)

Nokia is developing a sophisticated virtual reality (VR) platform which includes: OZO+ Camera,
OZO Creator, OZO Live, OZO Deliver, OZO Player SDK and OZO Audio. The OZO Camera is a
sophisticated $45,000 ball-shaped device that captures 360-degree spherical video and 360 x 360
surround sound. There are eight video sensors, each packing a 2,000 x 2,000 resolution and a 195-
degree field of view. The camera comes with enough storage space to record 45 minutes of video
via the OZO Digital Cartridge.

Their aim is to offer high quality VR which can be used by production teams and filmmakers. The
company is also partnering with a range of technology companies including; Harmonic, Akamai
and AWS Elemental.

GoPro
https://shop.gopro.com/virtualreality
(NASDAQ: GPRO)

GoPro announced a16-camera virtual reality rig called Odyssey. It costs $15,000, and only
"professional content creators and producers" will be allowed to buy it — after they submit an
application. It is an end-to-end solution for capturing, stitching and publishing high-resolution
virtual reality and immersive content. Odyssey is the first camera rig built specifically for
Google's Jump platform. As mentioned above, Jump is an entire virtual reality ecosystem that, in
theory, will make it easier to both create and consume VR content.

Marxent Labs
http://www.marxentlabs.com
Total Equity Funding
$13.7M in 6 Rounds from 3 Investors, Most Recent Funding: $10M Series B on April 11, 2016.

Marxent is the leader in Virtual Reality and Augmented Reality product visualization for sales and
marketing. Their Visual Commerce 3D Virtual Reality Design Studio & Showroom allows
retailers and manufacturers to create a 3D design studio and showroom for building live demos,
similar to what Bricks & Goggles does. This VR company’s biggest customer is home
improvement chain Lowe's, which offers the Holoroom. Customers build a virtual room made of
Lowe's products, then use the headset to see the room as it would look when constructed.
Estimated revenue: $2.8M

© The Hutch Report 17


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Orah
https://www.orah.co
Total Equity Funding
$7.6M in 4 Rounds from 7 Investors, Most Recent Funding: $4.82M Seed on September 1, 2016

The first all-in-one live VR camera. Orah is a leader in virtual reality solutions. Founded in 2012
under the name VideoStitch the company quickly established itself as a major provider of high
quality live and postproduction 360° video creation software. With Orah 4i it entered the hardware
market in 2016, offering the first all-in-one 4K camera designed for VR live streaming. Orah thus
provides a solution for every scenario in VR video production on the market to date. Its customer
base ranges from small production houses to Fortune 500 companies in over 62 countries,
primarily from the entertainment and media industry. Originally founded in Paris, Orah is now
headquartered in California.

Matterport
http://www.matterport.com
Total Equity Funding
$61 M in 6 Rounds from 20 Investors

Matterport is a 3D media technology company using computer vision and sensor technologies to
create the next generation of engaging photography that will enable more immersive interactions
on Web, mobile, and VR - including the ability to engage with spaces as they are today and the
ability to visualize future changes. In addition to WebGL delivery to browsers and mobile devices,
we have built a VR app that currently runs on Oculus platforms and on Google Cardboard and
other VR platforms as they emerge. This also makes Matterport the only mass-scale capture
system for VR content today - making Matterport VR Showcase the first killer app for VR.
Estimated revenue: $5.9M

Panorics
http://www.panorics.com 

Total Equity Funding
$50k in 1 Round, Most Recent Funding: $50k Seed on September 30, 2014


Panorics develops 360-degree fully immersive video solutions and cameras for various industries
including Virtual Reality, entertainment, real estate, travel etc.

© The Hutch Report 18


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Development - Developer Tools


Unity Technologies
https://unity3d.com
Total Equity Funding
$289.2M in 5 Rounds from 10 Investors

Unity Technologies is the creator of Unity, a high-performance end-to-end development platform


that creates rich interactive experiences. A leading developer of 3D game technology, Unity offers
a self-titled gaming development platform for building VR games, and the company's CEO claims
at least 90, if not 95 percent, of all content built so far for VR has been built on Unity. It supports
all headsets. Estimated revenue: $10M
Update: This month Unity, whose software powers half of all new mobile games, lands $400
million from Silver Lake

High Fidelity
http://highfidelity.io
Total Equity Funding
$37.9M in 4 Rounds from 7 Investors, Most Recent Funding: $22M Venture on December 12,
2016

Open Source software for shared Virtual Reality. Estimated revenue < $1M

Applications - Business/Enterprise
WorldViz
http://www.worldviz.com
Total Equity Funding
$3.5M in 2 Rounds from 1 Investor, Most Recent Funding: $2.5M Series A on April 14, 2015

WorldViz is a virtual reality company that makes 3D interactive and immersive visualization and
simulation solutions aimed at universities, government institutions, and private business alike. Its
software allows customers to build 3D models for product visualization, safety training, and
architecture visualization. The company claims customers save about 90 percent of the costs
involved in making real physical models by making full sized virtual displays for layouts of
buildings instead.

The HTC Vive virtual reality headset boasts the ability to create “room-scale” VR experiences for
consumers in their living rooms. But enterprise VR company WorldViz goes a step further,
allowing users to walk around in a space the size of a warehouse and still be tracked by a motion-
sensing system for VR. Estimated revenue: $5.9M

© The Hutch Report 19


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

InsiteVR
https://www.insitevr.com
Total Equity Funding
$1.5M in 2 Rounds from 8 Investors, Most Recent Funding: $1.5M Seed on August 19, 2016

InsiteVR is virtual reality software for the architecture, engineering and construction Industry.
They allow architects to better communicate with clients by giving them the opportunity to dive
into CAD files with clients and scope out spaces in a more lifelike manner. Customers of InsiteVR
can upload their models to the service and view them on Gear VR, Oculus Rift or HTC Vive
virtual reality headsets. InsiteVR relies on “asymmetrical VR presentations” to allow multiple VR
users to explore content together and collaborate while a desktop user directs them through
various environments. Estimated Revenue: $3M

Retinad Analytics
https://www.retinadvr.com
Total Equity Funding
$1.6M in 3 Rounds from 9 Investors, Most Recent Funding: Seed on May 1, 2016 / Undisclosed
amount.

Retinad Analytics is a platform for Virtual Reality. It is one of the few enterprise-oriented VR
companies. They provide companies with a "heatmap" of users' browsing, navigation, purchasing
behavior, and other analytical data on an e-commerce website, allowing companies to get a 3D
visualization of behavior and statistics. This allows you to see "hotzones," where there may be
problems or popular features alike. VR advertisers can track, monitor and analyze the data and
improve and change their ad strategy and placement accordingly.

Virtalis
https://www.virtalis.com
Total Equity Funding
Series A funding round in 2004 (amount unknown) which was used for expansion. They currently
have 36 employees and an estimated revenue: $7M

Virtalis is a virtual reality and advanced visualization company that specialized in immersive
visualization systems, 3D visualisation software.The core system for this VR company,
ActiveWorks, allows customers to create 3D displays or virtual visualizations of data, CAD
designs or other data sources. Its specialty, though, is very large data sets. It is designed for large-
scale CAD models, including ships that let the designers "walk through" the ship before they ever
build it. In addition to design reviews, the software also lets users rehearse in-depth training tasks,
validate maintenance procedures or verify assembly and manufacturing processes.

Nurulize
http://www.nurulize.com
Total Equity Funding
$2M in 1 Round from 1 Investor, Most Recent Funding: $2M Seed on January 8, 2015.

Nurulize is a virtual reality software development company. Estimated revenue < $1M

© The Hutch Report 20


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Mechdyne
https://www.mechdyne.com
Total Equity Funding
Mechdyne is an established comany founded in 1996, with 38 employees and an estimated $4.4
million in revenue.

Mechdyne uses Cave Automatic Virtual Environment (CAVE), which projects a virtual reality
environment on three and six of the walls of a room-sized cube, to visualize data in a number of
vertical industries. It specializes in modeling and simulation, Big Data visualization, and
collaboration.

Bricks & Goggles


http://www.bricksandgoggles.com/en/
Total Equity Funding
As of yet, Bricks & Goggles has not yet received funding – the founders financed the company
themselves with capital from earlier ventures

This Dutch software firm transforms construction designs from major CAD and other 3D
modeling software into three-dimensional VR environments, which you can then view in a life-
like 3D image using any of several headsets, including Oculus and Google Cardboard. This gives
people a chance to “walk through" a design, as it were, and see how it would look when
completed, so they can make changes.

Virtual Reality Minds


http://osirus.online/launch/
Total Equity Funding
Undisclosed Amount in 1 Round, Most Recent Funding: Seed on May 1, 2016 / Undisclosed
Amount

Osirus is a Cloud based TV platform from Virtual Reality Minds for publishing standalone TV
channels direct to consumers via VR, Smart TV, phones & In-Vehicle infortainment. They are one
of the first broadcast platforms to build-in support for stereoscopic Virtual Reality viewing. Osirus
channels are broadcast in stereoscopic 3D TV, without the need for specialized video files,
formating or complicated conversions. Patent-Pending Native VR Mode allows viewers to watch
your real-time linear television channel in full HD using any Google Cardboard Compatible VR
Headset.

Virtualitics
https://www.virtualitics.com
Total Equity Funding
$7.4M in 2 Rounds from 1 Investor, Most Recent Funding: $4.4M Series A on April 11, 2017

Virtualitics provides data visualization in virtual reality and augmented reality environments. They
are aiming to bring insight through isolation, visualization and manipulation, giving you a chance
to get up-close and personal with your data while wearing a VR headset.

© The Hutch Report 21


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

IrisVR
http://www.irisvr.com
Total Equity Funding
$9.73M in 3 Rounds from 11 Investors, Most Recent Funding: $8M Series A on October 25, 2016

IrisVR creates a suite of products that help edit, share and visualize 3D models in Virtual Reality.
Their first product converts existing 3D designs into the Oculus Rift with 1-click. Select partners
with early access are already using IrisVR for their internal design workflows and client
presentations. They have also added a mobile app called Scope that lets you view panoramas in a
Google Daydream/Cardboard or Samsung Gear VR device. Estimated revenue: $4.4M

Applications - Content Platforms


NextVR
http://www.nextvr.com
Total Equity Funding
$115.5M in 3 Rounds from 11 Investors, Most Recent Funding: $80M Series B on August 9, 2016

NextVR enables the transmission of live, long-form virtual reality content in broadcast quality -
leading the way for live and on-demand VR to become a mainstream experience for sporting
events, concerts, cinematic productions and more. Launched in 2009, NextVR has more than 26
patents granted or pending for the capture, compression, transmission, and display of virtual
reality content. NextVR's platform allows the fully immersive content to be streamed with pristine
quality using current home and mobile Internet connections. Estimated revenues: $8.2 million

Jaunt
http://jauntvr.com
Total Equity Funding
$100.21M in 4 Rounds from 17 Investors

Jaunt is developing the hardware, software, tools, and applications to enable cinematic VR and put
the power of virtual reality in the hands of today’s best content creators. Jaunt’s proprietary
algorithms for complex computational photography allow content producers to create incredible
immersive cinematic VR experiences using existing production software. Estimated revenue:
$3.1M

© The Hutch Report 22


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Pixvana
http://www.pixvana.com
Total Equity Funding
$6M in 2 Rounds from 3 Investors, Most Recent Funding: Convertible Note on December 21,
2016 / Undisclosed Amount

Pixvana is a Seattle-based software startup building a Virtual Reality (VR) and Augmented Reality
(AR) video processing and delivery platform for media and entertainment applications. Pixvana’s
founders have proven startup success in media technology and hail from senior product and
engineering leadership positions at Apple, Adobe, Microsoft, and Lucasfilm. Estimated Revenue:
$1M

Livelike
http://www.livelikevr.com/#sectionHome
Total Equity Funding
$5.91M in 3 Rounds from 9 Investors, Most Recent Funding: $5.01M Series A on September 21,
2016

LiveLike is a Virtual Reality (VR) platform company that enables broadcasters and sports teams to
deliver immersive, live sports viewing experiences. They have developed a sports viewing
platform that leverages the immersive nature of VR to bring the thrill of game-day stadium
experiences into fans’ living rooms. Estimated Revenues: $14M

Boom.tv
http://boom.tv
Total Equity Funding
$3.5M in 1 Round from 9 Investors, Most Recent Funding: $3.5M Seed on December 13, 2016

Boom.tv is the first 3D live-streaming platform for watching eSports on any device. Streamers use
the platform to provide instant replays and multiple viewing angles for viewers on their PCs and
mobile devices. For viewers with VR headsets, Boom simulates actually being in the game.
Estimated revenue: $1.2M

Vizor.IO
https://vizor.io
Total Equity Funding
$2.3M in 1 Round from 2 Investors, Most Recent Funding: $2.3M Seed on April 19, 2017

Vizor is an online platform that lets its users explore, create, and publish virtual reality on the web.
Its platform is quipped with easy-to-use tools such as instant preview, drag-and-drop features, text
editor with web font support and more, Vizor allows creative teams across all industries to build
and publish 360-degree tours, immersive stories, virtual visits and WebVR experiences onto a
website or Facebook feed – all with no coding required. Estimated revenue < $1M

© The Hutch Report 23


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

SpaceVR
http://spacevr.co/
Total Equity Funding
$1.25M in 1 Round from 3 Investors, Most Recent Funding: $1.25M Seed on April 28, 2016

Founded in January 2015 by Ryan Holmes, CEO, SpaceVR is the world’s first virtual reality
platform allowing users to #BeAnAstronaut and experience space firsthand from any mobile,
desktop or virtual reality device. Through the use of 360-degree cameras, SpaceVR technology
feeds footage from low earth orbit back to Earth so consumers can experience space travel in
immersive virtual reality.

Virtually Live
http://virtuallylive.com
Total Equity Funding
Undisclosed Amount in 1 Round from 2 Investors, Most Recent Funding: Seed on March 1,
2008 / Undisclosed Amount

Virtually Live is a patented, revolutionary technology to experience live sporting events in virtual
reality (VR). Can't get tickets to the Super Bowl? Virtually Live creates a VR version of the
stadium and images of the players are generated, allowing you to be there. It recreates the actual
arena, so you actually walk through the stadium, and can invite friends and all sit together just like
you would at a real life game.

Roqovan Studios
http://www.roqovan.com/
Total Equity Funding
$8M in 2 Rounds from 3 Investors, Most Recent Funding: $4M Series A on October 1, 2015

An independent game development studio formed by the talented developers that led the creation
and production of some of the best selling video games in the world. Reload is developing content
to entertain an ever expanding audience for emerging Virtual Reality and existing game platforms.

nDreams
http://www.ndreams.com
Total Equity Funding
$8.24M in 3 Rounds from 1 Investor, Most Recent Funding: $2.49M Venture on November 16,
2016

nDreams is a videogame developer/publisher based in Farnborough, UK. They specialise in


creating Virtual Reality games, worlds and experiences. Estimated revenue: $5M

© The Hutch Report 24


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Mindshow (Visionary VR )


http://mindshow.com/
Total Equity Funding
$6M in 1 Round from 7 Investors, Most Recent Funding: $6M Series A on March 23, 2016

Mindshow (Visionary VR) is a technology and content development studio, and the home of
Visionary focus the revolutionary tool for virtual reality content creators that employs a
proprietary system for storytelling, attention management and information delivery in VR.
Estimated revenue: $2.5M

Within
http://with.in/
Total Equity Funding
$12.6M in 2 Rounds from 13 Investors, Most Recent Funding: $12.6M Series A on June 16, 2016

Within is an online platform for creating and distributing virtual reality films. The app is available
for iPhones, Android devices, and Samsung Gear VR headsets, Oculus Rift and HTC Vive.

Felix & Paul Studios


http://www.felixandpaul.com/
Total Equity Funding
$6.8M in 2 Rounds from 5 Investors, Most Recent Funding: Series B on April 20, 2017 /
Undisclosed Amount

Montreal-based Felix & Paul Studios is dedicated to storytelling through the medium of cinematic
virtual reality. The studio combines technological innovation with a unique, pioneering and in-
depth approach to the new art of virtual reality storytelling - creating high-end original cinematic
experiences. The company has developed a full-stack VR technology platform - including
proprietary 3D 360º camera systems and accompanying post-production software and process -
which sets the industry standard for the highest-quality VR filmmaking. Estimated revenue:
$46.2M

Applications - Education
zSpace
http://zspace.com/
Total Equity Funding
$56.61M in 2 Rounds, Most Recent Funding: $30M Venture on November 12, 2015

zSpace is a system that integrates into users’ normal lives with desktop virtual reality and allows
them to move in and out of zSpace back to the real world. This experience is enabled by a
combination of polarized eyewear with high definition stereopsis, integrated head tracking with
full motion parallax, and a precision interactive stylus. The system is focused on the learning
market, specifically STEM education, medical instruction, corporate training, research, and
design. zSpace was launched in 2007 by zSpace Inc. and its operations are based in California,
United States.

© The Hutch Report 25


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Woofbert
http://www.woofbert.com
Total Equity Funding
$5.32M in 2 Rounds, Most Recent Funding: $2.53M Convertible Note on July 22, 2016

WoofbertVR partners with the world's leading museums to share their collections through cutting-
edge Vr technology. Each WbVR experience engages users through original curriculum and
dynamic storytelling to bring art and culture to audiences around the globe. Estimated revenue:
$81.2K

Discovr 
https://www.discovrlearning.com
Total Equity Funding
$100k in 1 Round, Most Recent Funding: $100k Convertible Note on April 5, 2015

Discovr Labs is dedicated to harnessing immersive technology to facilitate the most compelling
educational experiences.

Applications - Medical
MindMaze
https://www.mindmaze.com
Total Equity Funding
$108.5M in 2 Rounds from 1 Investor, Most Recent Funding: $100M Venture on February 16,
2016

MindMaze operates a platform to build intuitive human machine interfaces combining VR,
computer graphics, brain imaging, and neuroscience. Their platform helps stroke victims to
recover faster by “fooling” the brain through VR/AR technology. Estimated revenue: $2.4M

Psious 
http://psious.com
Total Equity Funding
The company received seed funding (undisclosed) from Rothenberg Ventures, which specializes in
seed-stage VR and AR startups, and joined Rothenberg’s River Accelerator program.

Psious offers its users with virtual reality technologies for psychology. It is a behavioral health
technology company whose main product is the PsiousToolsuite, a virtual reality platform aimed
at bringing value to mental health treatment. The platform provides mental health professionals
with animated and live environments which they can use in their clinical practices.

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Deepstream VR
http://deepstreamvr.com/
Total Equity Funding
The company received seed funding ($100k) from Rothenberg Ventures, which specializes in
seed-stage VR

DeepStream VR is pioneering virtual reality games to help relieve pain and improve your quality
of life. Over a decade of research indicates immersive virtual reality can help relieve pain, reduce
stress, and build resilience. They are creating the next generation of intelligent VR games with
biofeedback to propel you to your optimum performance level. Estimated revenue: $2M

Vivid Vision
http://www.seevividly.com
Total Equity Funding
$2.93M in 3 Rounds from 9 Investors, Most Recent Funding: $2.2M Seed on May 11, 2017

Vivid Vision uses the virtual reality to help people with lazy eye (amblyopia and strabismus)
improve their vision. James Blaha, the creator of Diplopia, gained 3D vision and use of his lazy
eye with the alpha version of the software.

Applications - Social
WeVR
http://wevr.com
Total Equity Funding
$38.25M in 5 Rounds from 14 Investors, Most Recent Funding: $25M Venture on February 5,
2016

WEVR, previously known as WemoLab, is a virtual reality community and VR media player for
professional creatives. WEVR collaborates with leaders in the immersive, creative, and technology
communities – providing high performance VR playback software for VR producers. As an open
VR technology platform, WEVR enables immersive storytellers to create, present, and publish
projects on all VR headsets. Estimated revenue: $1M

PlutoVR
http://www.plutovr.com
Total Equity Funding
$13.9M in 1 Round from 3 Investors, Most Recent Funding: $13.9M Series A on April 13, 2017

With augmented and virtual reality technology it is now possible to feel a sense of presence with
other people, allowing you to communicate, collaborate, and connect from anywhere in the world,
as if you were there in person. Estimated revenue < $1M

© The Hutch Report 27


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Applications - Content Platform


AltspaceVR
https://altvr.com
Total Equity Funding
$15.7M in 3 Rounds from 19 Investors, Most Recent Funding: $10.3M Series A on July 29, 2015

AltspaceVR is a virtual reality software company. AltspaceVR is bringing two-dimensional web


content into shared virtual spaces, and extending the web to create fully holographic experiences.
Through the software users will be able to watch streaming video, play games, and get work done,
together and entirely inside of virtual reality. The software is powered by, and fully embraces, the
modern open web. Estimated revenue: $4M

Littlstar
http://littlstar.com
Total Equity Funding
$6.37M in 2 Rounds from 13 Investors, Most Recent Funding: $5.24M Series A on May 24, 2016

Littlstar is a global network dedicated exclusively to virtual reality, 360 video, and immersive
experiences. They aggregate virtual reality content .

Emergent VR
http://www.emergentvr.com/
Total Equity Funding
$2.2M in 1 Round from 3 Investors, Most Recent Funding: $2.2M Seed on October 15, 2015

Emergent VR, Inc is a technology startup in San Francisco building a new way to create and share
moments and memories using virtual reality. They are led by VR, game, and animation industry
veterans from Disney, 2K Games, and DreamWorks Animation. Estimated revenue < $1 M

Vrideo
http://www.vrideo.com/
Total Equity Funding
$1.8M in 1 Round from 11 Investors, Most Recent Funding: $1.8M Seed on March 25, 2015

Vrideo is a virtual reality start-up building a streaming, hardware-agnostic, and independent


immersive video distribution platform. Update - Now Closed Down

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Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Geographical Distribution

Looking at the current stable of virtual reality companies we can see that out of the 65
companies reviewed, excluding the public companies and the "undisclosed companies",
there has been a total of $3B invested (into 51 companies).  Of that money, the largest
investment has been into Magic Leap, based in Florida, with 1.39B invested into it by
Alibaba and Google. Including Magic Leap, 6 companies had $100M or more invested in
this order: Unity with $689.2M, Razer with $125M, NextVR with $115.5M, Mindmaze with
$108.5M, and Jaunt with $100.2M. Magic Leap is in Florida, Unity and Jaunt are in
NorCal, Razer and Next VR are in SoCal and Mindmaze is right here in Switzerland
(Lausanne).

Of the 65 companies, 83% were founded in 2010 or later. 12% of them are now public,
the rest are all privately held.

Although the majority of companies are based in the US, we are starting to see interest in
startups by venture capital funds in different geographical locations. However, only time
will tell if we start to see more companies like Mindmaze in Switzerland gain media
attention.

It is also interesting to note that Google Cardboard actually started in France therefore
we can’t conclude that all the innovation will come out of a US centric company with their
HQ in the US. The companies referenced in the chart, however, our those with their HQs
in a different location such as Homido, located in France.


© The Hutch Report 29


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

FORECAST ILLUSION
There’s an old saying that goes, “Predicting the future is easy … getting it right is the hard part.”

Remember the last time a technology was predicted as being the next huge thing? It was 3D
televisions. In spite of all the rosy forecasts, it failed to live up to the hype. There was massive
investment, 1.5 million sets sold - but nothing could persuade the public to wear those glasses.

It was to be the next big thing in home entertainment. After going colour, then high-definition, it
seemed inevitable that television would move into the third dimension. Since 2010, set
manufacturers such as Sony, Samsung and LG were insisting that we should all be watching
programmes in 3D. Broadcasters, including the BBC, Sky and sports network ESPN, jumped on
the bandwagon as well. They created whole new departments at the cost of millions to take
advantage of this must-have technology. However, one by one they dropped out. At the end of
2013, ESPN pulled the plug on its 3D channel, in its words, “because of limited viewer adoption
of 3D services to the home.”

So what happened? There were many reasons in fact from secondary effects (many of the same we
hear about connected to virtual reality), lack of programs and feelings of isolation and lack of
social interaction from having to wear the glasses (also a concern with virtual reality). Whatever
the reasons, consumers simply didn’t show up. However, we can also point to just as many cases
of technologies that were set to crash and burn, according to the forecasting pundits, yet
consumers did show up in mass and created new industries.

We present only one recent example of the “next great thing” in technology that never
materialized. Yet, it never seems to stop the predictors from believing that they know something
more than everybody else.

In his book “Expert Political Judgment: How Good Is It? How Can We Know?” Philip Tetlock
described that people who make prediction their business—people who appear as experts on
television, get quoted in newspaper articles, advise governments and businesses, and participate in
punditry roundtables—are no better than the rest of us. When they’re wrong, they are rarely held
accountable, and they rarely admit it.

Tetlock claims that the better known and more frequently quoted the predictors are, the less
reliable their guesses about the future are likely to be. The accuracy of an expert’s predictions
actually has an inverse relationship to his or her self-confidence, renown, and, beyond a certain
point, depth of knowledge. Our system of expertise is completely inside out: it rewards bad
judgments over good ones.

The fact is, people who follow current events by reading the papers and newsmagazines regularly
can guess what is likely to happen about as accurately as the specialists whom the papers quote.

© The Hutch Report 30


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

Assorted Headlines - Hype or Reality?

© The Hutch Report 31


Insights, Ideas and Tools for the New Economy 1 June 2017 - Report #2

About The Hutch Report

The Hutch Report was founded in 2015. Originally from North America, the founders have lived in Europe for the
past 20 years and traveled some of the most amazing places that the world has to offer. In that time, learning some
incredible things and living an incredible adventure. 

Along the way we have met a large number of fascinating people and worked with more than a few technology
startups, one which was sold to PayPal and another that was sold to Macrovision. In that time we have compiled an
extended network of contacts in the European and North American startup communities as well as the venture
capital and private banking sectors. 

Through interviews, research and analysis, our goal is to identify what is beyond the horizon. Where the next great
opportunities are and how WE and our READERS can profit from them. We are providing insights, ideas and tools
for the new economy.

Contact: Info@thehutchreport.com

Disclaimer

© 2017 The Hutch Report

The content of The Hutch Report and it's web site is provided for information purposes only. No claim is made as to
the accuracy or authenticity of the content found in this report or on our website.

The Hutch Report website and reports/newsletters do not accept any liability to any person or organisaation for the
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© The Hutch Report 32