Singapore state investor Temasek Holdings and Emerson Collective have led a $40 million Series B round in Los Angeles-based virtual and augmented reality startup Within. Additional investors in the round include advertising major WPP and Macro Ventures, with existing investors Andreessen Horowitz, 21st Century Fox and Raine Ventures participating.
Emerson Collective LLC is a vehicle founded by the widow of Apple co-founder Steve Jobs, Laurene Powell Jobs. Its main focus is education, immigration, the environment and other social justice initiatives.
Investment proceeds will fund the development of augmented reality (AR) experiences, an emerging form of digital entertainment. According to Goldman Sachs, the AR market has the potential to grow to a market capitalisation of $182 billion by 2025.
The deal also reflects growing investor confidence in the potential commercial applications for AR and VR.
In aggregate, Within has raised $56.6 million in equity funding. It develops its own virtual worlds, in addition to curating content from other creators. It has mobile apps available on both iOS and Android platforms, as well as a partnership with IMAX to deliver virtual worlds to its arcades.
The venture, formerly called VRSE, was rebranded to Within in June 2016 following its completion of a $12.6 million investment from Andreessen Horowitz and 21st Century Fox.
In an official statement, Within’s co-founder and CEO Chris Milk said, “With the new wave of growth surrounding emerging formats like AR, there’s a tremendous amount of momentum in the industry right now. However, the biggest challenge that the industry is facing is the lack of access to compelling experiences for consumers.”
One work that Within has developed is the immersive VR production Life of Us, a VR experience that debuted at Imax VR Experience Centres through a partnership with Imax. The production is a multi-user exploration of the evolution on Earth.
Another VR startup in the Temasek portfolio is Improbable Worlds, which closed a $502 million Series B round led by Softbank and saw participation from Temasek, Andreessen Horowitz and Horizon Ventures. These three investment firms backed a $22 million Series A investment in Improbable Worlds in March 2015.
The sector continues to see VR startups leading in terms of funding, though AR startups are closing this funding gap.
AR/VR funding in 2016 was propelled mainly by an investment in AR headset maker Magic Leap, which closed a $794 million Series C investment in February 2016.
Q1 2017 has seen deal volume surge, with a forecast of 293 deals by end-2017, a 47 per cent increase with AR/VR investment potentially seeing $2.16 billion in aggregate funding raised for 2017.