According to Digi-Capital, the virtual reality ecosystem is expected to grow into a $30 billion industry by 2020, and mobile game company GREE international is looking to invest in that growth. Not too dissimilar to Facebook, who acquired virtual reality headset manufacturer Oculus for $2 Billion a few years ago, GREE are looking to invest in both gaming and nongaming software and content companies through the GVR Fund.
According to Teppei Tsutsui, director of investment at GREE International, the virtual reality sector appears to have started off much like the very early stage of mobile phones just before industry boomed and growth rapidly resulted in a multi-billion dollar industry.
We believe that VR will soon become a platform and a new medium with which people will spend a large amount of time,” Tsutsui says. “We want to create the same value for the VR space that we have successfully done in the past through investing in the mobile ecosystem.”
GREE are looking at the entry point of virtual reality given most headsets that have been announced at the moment are the best part of $500 upwards. Tsutsui says that at least in the beginning, GREE see an opportunity in the casual to midcore genre games mixed in with some social aspects for the mobile VR experience.
“Although the fund is managed by GREE VR Capital, LLC, which is founded by GREE Inc., our goal is to create value for our investors, mostly strategic investors including GREE,” Tsutsui says. “We intend to leverage GREE’s expertise and network within the VR space to achieve that.”
It seems that the GVR Fund will work similar to that of Google Venutres and trade an active stake in the business idea in exchange for investment. GREE has already invested in a nongaming virtual reality company called VRChat, which is a platform that allows users to create, publish, and explore VR worlds with users around the world. In addition, the first game to come out of the GVR Fund is Tomb of the Golems. This shooter title is designed for the Samsung Gear VR and is set in the ruins of Egypt and will ship this month with the game following a pay-to-play business model.
“Right now we see mostly the pay-to-play model, where you need to pay $3 to $10 to purchase each app or game,” Tsutsui says. “Just as mobile has moved from pay-to-play to free-to-play as it attracted more users, we believe the same thing will happen with the VR space.”
It’s great to see investment funds being set up to support virtual reality as it will hopefully be the catalyst to get content created for the headsets in an ecosystem that is being shaped not by the exclusive titles or even the hardware of the headsets, but for the virtual reality experience overall, and hopefully the GVR Fund can encourage some great development.