Riding the Augmented Reality Wave

Corporate Finance & Restructuring | Telecom, Media & Technology (TMT)

March 10, 2017

Eye

A record $2.3 billion was invested in augmented reality (“AR”) startups in 2016, representing a three-fold increase from the $700 million invested just a year earlier.1

AR hardware saw the largest investment, securing nearly 40 percent of total dollars. Key deals included $794 million raised by Magic Leap and capital raises by other AR hardware players, including ODG at $58 million, Meta at $50 million and Lumus at $45 million. The second largest investment area came in the AR services and solutions arena (including a $181 million investment in Unity, or nearly 20 percent of investment, the provider of a top game development platform and community.) Finally, AR apps also experienced large investments, driven by a $54 million raise by Blippar, a company that provides an AR mobile app and self-service suite of tools.2

Overall, the vast majority of investment in AR occurred at the top of the technology stack, as seen in Figure 2. In the future, as AR capabilities and communities become well-established, we anticipate the System Integration layer of the stack – creating integration of ecosystems – will be a focus investment area play.

1 Digi-Capital, Augmented/Virtual Reality Report Q3 2016
2 Digi-Capital, Greenlight Insights

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