In 2019, more than $4.1 billion was invested in augmented and virtual reality projects. This is less than in 2018.
This is reported by Digi-Capital experts in their new report, writes Venture Beat. What is clear from it:
- 2019 is the third year in terms of global investments in virtual and augmented reality after record 2017 and 2018.
- In annual terms, the number of investment transactions fell by 27%. Total dollar investments in AR/VR decreased by 35% compared to 2018.
- The drop is due to the fact that in the 4th quarter of 2019, the volume of investments decreased significantly compared to the 3rd quarter. Fewer transactions were made and for smaller amounts. If this decline continues in the first half of 2020, then AR/VR startups will have to focus not on growth, but on income stabilization, Digi-Capital warns.
- AR/VR games, educational, medical, industrial software and technological solutions attracted the most investors in 2019. The largest sums were invested in AR/VR technologies, games, geolocation software and smart glasses.The most significant and profitable investment stages were seed rounds, grants, series “A” and “B”.
- Most often, investments were made in the amount of $0.5-1 billion, $10-50 million and $50-100 million.
- The largest number of investment AR-VR deals traditionally fell on the United States and China. Israel, Great Britain and Canada are next. Analysts noted that in other countries, the level of investment decreased in annual terms.
- There were few mergers and acquisitions in the AR-VR segment over the year. In 2019, such deals were concluded for $700 million. Most often, companies developing AR/VR games, smart glasses, and technological solutions were acquired.
- Note that in the short term, the number of mergers and acquisitions is unlikely to grow. But there may be a jump in the future if there are big changes in the market.
- Digi-Capital analysts are confident that 2020 is potentially a turning point for the segment. The market trends laid down in 2017-2020 may change. This is partly due to the COVID-19 coronavirus and new major deals in AR/VR.
- Probably, the release of the VR game Half-Life: Alyx will also affect the market. Some experts believe that after its release, at least the VR segment can enter a new stage of development.
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