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Who is investing in the metaverse

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Web3 and the Metaverse are here to stay -- not just in one industry, but across all industries.

Original title: "Who Is Investing in the Metaverse?" We held talks with top venture capitalists."

Original source: sifted

This article comes from WeChat public account: Old Yuppie

Recently, some of the luster of the Metaverse has faded, Elon- Musk called it nothing more than a marketing gimmick, and the average price of NFTs dropped significantly.

But the interest of big corporations in the metaverse has not diminished one bit. Microsoft's $68.7 billion acquisition of gaming company Activision Blizzard, while Epic, maker of the multiplayer online game Fortnite, recently acquired Bandcamp, a community of independent music artists, signaled its intention to move further into online concerts and music discovery. HSBC has announced plans to close 69 physical bank branches while buying a piece of virtual land on metaverse platform The Sandbox for an undisclosed sum.

Meanwhile, about 70 fashion brands, including big names like Estee Lauder, Tommy Hilfiger, Dolce & Gabbana and Forever 21, participated in another Metaverse platform Decentraland's virtual fashion week.

Clearly, the metaverse is still big business, and venture capital investors, even more modest funds, are also looking for deals in this space.

Sabina Wizander, partner at Creandum, said: "Web3 and the metaverse are here to stay -- not just in one industry, but in all industries."

While many of the recent big deals have been in the U.S., European investors see the arrival of the Metaverse as Europe recapturing what it has seen over the past 15 years Some lost opportunities for technological dominance.

Henry Gladwyn, partner at OMERS Ventures, said: "If the Metaverse ends up being primarily game-based, then Europe will have a chance to lead, as some of the world's leading game companies are all from Europe.”

There are some professional metaverse investors in Europe, such as FOV Venture Capital, which was just established this month, and Luxembourg-based Games industry fund Hiro Capital. Also, general funds and specialized deep tech investors are looking for specific deals. Sifted interviewed some people to find out what they focus on and how they see the metaverse market developing.

Luke Alvarez, Hiro Capital

Investments: Frameplay, Dreamcraft Entertainment , Keen Games

Hiro Capital, Europe's oldest investment beast, recently launched a second fund - €300 million - to coincide with its 2019 launch The first €115 million fund. Hiro Capital has also launched a special purpose acquisition company and hopes to bring game companies with an enterprise value in the €400 million to €2 billion universe to the stock market.

Hiro has a solid gaming pedigree. It was founded by Ian Livingstone, the former chairman of Tomb Raider game publisher Eidos, sometimes referred to as "Father Lara Croft." Yes, it's called Hiro Capital, named after the main character in Neal Stephenson's Snow Crash, which predicted the Metaverse back in 1992.

Founder and partner Luke Alvarez said the first investments from the Hiro Capital 2 fund are expected to be announced next month. The bulk of the fund will target startups in Europe, about 15% in the U.S., and a small portion in other markets (for example, Hiro Capital recently invested in an Indian real-time gaming company called Loco).

"It's still early days for the Metaverse, we'll be building it in the next 20 years"

“We see the Metaverse as part AR and VR, part massively multiplayer games, and part Web3 and cryptocurrency,” Alvarez said. He believes there will be a "crazy hybrid and overlapping metaverse" in the future, rather than a metaverse dominated by Meta or Microsoft.

Alvarez is also very bullish that European companies will get a big slice of the Metaverse market.

“2022 is as exciting an opportunity as 2002, when we were at the dawn of the mobile internet, which led to Facebook and Google, Tencent, Alibaba The emergence of companies such as Baidu and Baidu.”

While European companies have clearly missed the mobile Internet era, Alvarez believes that Europe can play a huge role in the metaverse era.

He points out that a third of the world's game content is developed in Europe, and many early metaverses such as Minecraft (now owned by Microsoft , but originally created by Mojang in Sweden) were developed here. Metaverse platform The Sandbox, although now owned by Hong Kong-based Animoca Brands, was founded by Frenchman Sebastian Borget.

Alvarez. said: "There are more game developers in Europe than in the US, and it's generally cheaper to develop things here."

Alvarez is also eyeing companies out of Oxford and Cambridge that are developing hardware for augmented reality and virtual reality. “We’re looking at developments like laser holography and other ways of delivering images to people’s eyeballs. These will help create a hyperscale AR proposition for billions of people, hopefully within 10-15 years.”

Alvarez expects to invest 20 percent of the new fund -- about 10 or so deals -- in deep technology companies. That could mean investing in no-code gaming platforms that make it easier for kids to create their own games, or in-game advertising that would allow, for example, a brand to place a logo on an in-game T-shirt.

He is relaxed about the ups and downs of the hype surrounding the Metaverse, taking a long-term view on it.

Henry Gladwyn, OMERS Ventures

Investment: Medal.tv< /p>

Omers Ventures is a general fund that has only recently begun to consider the idea of investing in areas such as games and cryptocurrencies.

"Gaming and cryptocurrency is a journey for us," said partner Henry Gladwin. “But the metaverse is a big trend, and we have to try to be part of it.”

So, in December, OMERS chose to lead the $45 million Series C Funding goes into Medal.tv, a company that makes it easy to create and share clips of memorable gaming moments.

Gladwyn sees the metaverse and gaming as the next phase of the internet and social media.

He said: "A lot of what games offer is an interesting alternative to the problems facing Web2, which relies on attracting a large number of audience, and then try to connect people through their interest groups. This can sometimes lead to extremism and obsession, and it’s not always a natural way for people to socialize.”

< p>“If you get a Roblox in your portfolio, it’s going to give you a return on the fund.”

Gladwyn said he’s looking for something that can really Games that become social experiences. Medal, for example, is trying to build a social network for gaming, with shareable clips of gaming moments. But again, OMERS may invest in game engines, or other things related to games.

Every Metaverse investor secretly hopes to find the next Roblox, Gladwyn said. "If you have Roblox in your portfolio, it's going to give you big returns."

But he worries that the older games are too reliant on finding A hit for hype, these companies may not have long-term staying power. Everyone is watching how Roblox is doing.

Gladwyn said the average company can have a hard time getting into the best Metaverse deals. Cryptocurrency terminals are especially tricky, he noted, because many cryptocurrency companies distrust venture capital firms and have other ways of raising capital.

David Haynes and Petri Rajahalme, FOV Ventures

Music Streaming David Haynes, one of the founding team of company Soundcloud, teamed up with XR industry veteran Petri Rajahalme to launch FOV Ventures, a fund dedicated to early-stage Metaverse startups.

The €25 million fund will support 25-30 seed and pre-seed Metaverse startups. FOV will invest in three different types of Metaverse companies. First up are companies that create games and experiences in the metaverse, including digital fashion, shopping, and concerts.

They are also looking at startups in the corporate metaverse -- virtual meetings or digital twins of factories. A third area of investment will be in startups creating "tools" for the Metaverse: platforms, avatars, sound effects and backgrounds.

FOV will not invest in cryptocurrencies and NFTs - although these are seen by some as an important part of the Metaverse.

Sabina Wizander, Creandum

Investment: Resolution Games , Armada Interactive, Scapin

Creadum is a comprehensive company, but recently decided it needs to participate in metaverse and Web3 trends. It's clear that the Metaverse and Web3 are here to stay -- not just in one industry, but across all industries.

Wizander remains skeptical about NFTs and cryptocurrencies. "I'm still looking for a use case that solves a real problem," she said. "I wouldn't want to invest in a speculative NFT project."

However, Creandum did invest in Scapin, a metaverse game where people can Socialize with each other. Like Gladwyn of OMERS Ventures, Wizander sees the metaverse as an evolution of the current internet.

"When people are skeptical about whether we're actually going to live in these virtual worlds, I say -- aren't we already doing that? ?We’re constantly looking down at our phones. It’s just that at the moment our main consumption is text or video,” she said.

If someone had told us five years ago that we would be sitting in video conferences 12 hours a day and it would be the only way we would do business, we wouldn't believable. "The idea of the metaverse is just the next step in how we spend time online in more meaningful ways," she said.

Wizander believes there will be more Metaverse platforms -- a few big ones and a long list of smaller ones. They're going to need to be interoperable, and people are going to need to be able to use their profiles and avatars on all of them.

Creandum is interested in virtual goods and fashion. A big question for Wizander is where the power will be - will the big metaverse platforms want to control who their visitors are, or will they let users and virtual goods Do third-party manufacturers own their own identities and products?

Predicting which platforms will be the most popular with users is also a gamble, she said.

Wizander said: "Building a consumer platform is not a science, you need something magical to get people to spend time there and build on that."

Ziv Reichert, LocalGlobe

Investment: Improbable, 100ms

Ziv Reichert, Partner at LocalGlobe, said: "Our belief is that there will not be a single metaverse, there will be millions, like we have today. .”

“I think the metaverse is the transition from a two-dimensional internet to a three-dimensional internet. The first prototypes of this are already in Roblox, Minecraft, and Fortnite. It doesn’t have to be through VR or AR, it can be mobile-first.”

LocalGlobe has invested in Improbable, a game engine that’s trying to make thousands Tens of thousands of people enter the same game server at the same time. Technology like this is the foundation of the Metaverse platform -- it's hard to hold a big concert or sporting event in a virtual world if you can't get a lot of people in at the same time.

LocalGlobe also wants to invest in tools that make it easier for anyone to build a 3D world -- what Squarespace and Wix do for building websites work. Reichert is also interested in how user identities are built in the metaverse and digital fashion.

Reichert believes Europe's strong arts ecosystem will help it dominate the Metaverse. "Building 3D persistent environments is one thing, but it's meaningless if they don't have any life force," he said.

Max Bautin IQ Capital Fund

Investments: Virti, Cauldron, Audio Analytic

IQ in Cambridge Capital, a deep tech specialist fund, has invested in startups such as Virti, which provides VR training for companies, and immersive games studio Cauldron, which was spun out of fintech unicorn Thought Machine.

Bautin is wary of the metaverse hype. "We want to invest primarily in technologies where there is a confirmed need right now. Right now, the metaverse proposition on the consumer side is very unclear. But there is a clear need in areas like training and education using virtual and augmented reality," he said explain.

“We invested in Virti because it’s a virtual training company, and it’s a fantastic space that every company has the potential to use. Any job has training needs, and VR can meaningfully improve their efficiency," he told Sifted.

IQ Capital will also focus on other Metaverse tools, for example, the technology to enable advertising in the Metaverse. According to Bautin, advertising is one of the main ways the Metaverse is monetized.

Anne Glover, Amadeus Capital Partners

Investment: XYZ Reality, V7, PolyAI

Anne Glover, co-founder and CEO of Amadeus Capital Partners, is also a skeptic. She believes that the surreal experience associated with VR headsets will only appeal to some people.

“There’s a lot of money to be made from it, but I personally don’t think it’s going to take over all areas of life,” she said.

So when it comes to the Metaverse, Glover and her team are more focused on commercial applications, such as XYZ Reality, a London-based startup that Create augmented reality overlays of architectural designs for construction sites. Glover has also personally invested in a VR company that creates a safety training experience for oil rig workers — able to put them on a virtual oil rig before they have to face the dangers of the real thing.

Amadeus is also interested in toolmakers and recently invested in V7, a machine vision startup that allows users to quickly label people and objects in video . Glover believes that as we move into a more visual internet, there will be an increasing need for tools like this.

David Glick, Edge VC

Investment: Mojo Vision, Dream Corporation.BLAST Premier

Edge Corporation does not present itself as a metaverse investor, but leans more towards the broad definition of investing in the creative economy.

Like many Metaverse investors, Edge's focus is on the tools to build the Metaverse, and Edge is looking at VR training and education because it believes it is more Much of the training will take place in a more immersive environment. Surgeons, for example, will use immersive VR as part of their training as haptic technology becomes more advanced to mimic living surgery.

Edge companies have invested in some hardware that may help enable the metaverse -- such as Mojo Vision, which is developing smart contact lenses with built-in displays, and London's VR entertainment venue Otherworld Inc.

Some of Edge's portfolio companies, such as Dream Corporation. BLAST Premier and Jungle, initially focused on the Web2 experience, but are now expanding to Web3, so Edge is there by default as a metaverse investor.

For example, Dream Corporation is a virtual reality theme park that offers a variety of virtual reality games, experiences, food and beverages. One of its sub-brands, Otherworld, has real locations in London and takes you to 16 unique VR locations.

BLAST Premier delivers elite-level esports and gaming content to audiences around the world and wanted to develop a more immersive version of the game and provide creators Tools that allow gamers to monetize their ideas.

Jungle Creations, a publisher of social-first video content, recently launched Futur3ology on Snap, a social-first consumer brand as it is Going in the direction of providing a Web3 experience to its followers.