Large media and communications companies, such as Verizon, The New York Times Company, Hearst Corporation, and Comcast made over 100 deals to startups last year. And funding and deal flow has been increasing every year since 2012. While deals to fledgling startups are not necessarily new for the industry, media companies have been rethinking their content distribution strategies, increasingly placing bets in emerging tech areas such as augmented and virtual reality.
This past year saw a high of 38 equity deals into augmented reality (AR) or virtual reality (VR) startups by media companies, up over 130% since 2015. Just this December, Comcast Ventures participated in an early round to Spaces and Metro-Goldwyn-Mayer participated in a Series C to Survios.
Spaces is a VR startup which, among many other initiatives, is trying to bring VR to amusement parks, while Survios is a VR game developer. Below we used CB Insights data to plot equity deals to AR/VR startups by media companies since 2014.
Key Takeaways:
- The past two years have seen a boon of activity in the media sector as large and small players alike rush into the augmented and virtual reality space. In 2014 there were 7 deals to AR/VR startups by media companies. In 2015 this more than doubled, reaching 16. Then in 2016, investment ballooned 137% to reach 38 equity deals.
- We are seeing crowded rounds as media companies compete for promising deals, even at the early stages.
- The $300K seed round of Within, which creates VR films, had 6 media investors (Live Nation Entertainment, Vice Media, Legendary Entertainment, WME Entertainment, Annapurna Pictures, Tribeca Enterprises) while their $12M Series A in 2016 had 7 with the addition of 21st Century Fox.
- Jaunt, which makes 360-degree cameras for filming in virtual reality, saw investment from Sky Media in its 2014 Series A and Series B. Then, in 2015, Axel Springer, Disney, Participant Media, ProSiebenSat.1 Media, and Madison Square Garden joined for their Series C.
- NextVR, which enables live events to be viewed in VR, had 3 media investors (Time Warner Investments, Comcast Ventures, Madison Square Garden) in their 2015 Series A and 4 for their 2016 Series B with the addition of Dick Clark Productions.
- The most active media investor in AR/VR since 2014 was Comcast, with deals to 7 companies including Spaces, Kite & Lightening, and NextVR. In second was Japan-based Colopl with 6 deals including Psychic VR Lab, Pinscreen, and Owlchemy Labs. GVR Fund, Disney Accelerator, Bertelsmann Digital Media Investments, and 21st Century Fox tied for third with 3 deals each.
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