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Virtual Reality StartUp Landscape


Virtual reality also called synthetic experience/ virtual worlds/ artificial reality refers to immersive, interactive, multi-sensory, viewer-centered, three dimensional computer generated environments and the combination of technologies required to build these environments.

VR immerses the user into a completely computer-created experience that artificially replaces his/her physical surroundings. With our obsession with computer graphics especially in the gaming world, coupled with the advancement of microprocessors has provided even the simple computer user with the opportunity to explore outside the three dimensional world of these computers. The user can watch and manipulate the simulated environment in the same way we act in the real world, without any need to learn how the complicated (and often clumsy) user interface works.


Virtual Reality (VR) is not an entirely new concept; it has existed in various forms since the late 1960s. Virtual Reality (VR), sometimes called Virtual Environments (VE) has drawn much attention in the last few years. Extensive media coverage causes this interest to grow rapidly.

Very few people, however, really know what VR is, what its basic principles and its open problems are. In this paper a historical overview of virtual reality is presented, basic terminology and classes of VR systems are listed, followed by applications of this technology in science, work, and entertainment areas. VR also provides a much improved technique for health and safety training. VR techniques can be used in ergonomic assessment of workspace layout, for rapid prototyping of control interfaces, for the simulation of potentially dangerous environments such as nuclear plant maintenance and in education and training of users in areas such as the maintenance of complex machinery.


The problems or objections to Virtual reality applications borders on ethical and health issues.

Ethical issue

• VR experimentations involve human subjects and their interaction with the virtual world. This is a worldwide problem as there are lots of opinions regarding these ethical standards. Scientific experiments that involve human subjects must uphold high standards of ethics, which is a lesson that was painfully learned from Nazi medical experiments and the Tuskegee syphilis experiment in the mid 20th century.

• TV has in the 1960s increased the homicide rate in American society [Kall93]. VR can potentially have the same influence on our society a few years from now. People playing brutal games may identify themselves with the virtual heroes and adopt their violent behavior. With the improvement of the simulation and visual quality of virtual worlds the differences between reality and VR will be constantly disappearing and consequently people may become confused what is real and what is virtual. In fact this process has already begun: military simulations are becoming so close to reality that soldiers do not know any more whether they are remotely steering a real “death-machine” or just making a training. This may eventually lead to the lack of responsibility for our actions: one can kill cold-blooded thousands of innocent people not knowing (or rather pretending not to know) if taking part in a simulation or a real mission [Smit94].

Health Issues

• Probably of biggest concern are the postural demands of fully immersive implementations especially with the use of heavy HMDs , due to the constraints in the current display screen technology many HMDs are still relatively bulky in terms of both size and weight. Improperly fitting HMDs can cause discomfort and additional strain can be placed on the neck by large masses.

• Another health issue would be Simulator sickness. It is similar to motion sickness. It generally involves the vestibular organs which implies that they involve sensory input or conflict regarding accelerations.

Other health issues would be:

• Nausea: In mild form, users may start having unpleasant sensations associated with the stomach, upper abdomen, esophagus, or throat. As the intensity increases, it gradually leads to the feeling of needing to vomit. This is the most negative and intimidating symptom of VR sickness.

• Dizziness: Users may feel a sensation of movement, such as spinning, tumbling, or swaying, even after the stimulus is removed. This may also include vertigo, which is similar and often associated with malfunctioning vestibular organs.

• Drowsiness: Users may become less alert, yawn, and eventually start to fall asleep.

• Increased salivation: The amount of saliva in the mouth increases, causing more swallowing that usual.

• Cold sweating: Users begin to sweat or increase their sweat, but not in response to increased ambient temperature.

• Sopite syndrome which is closely related to drowsiness, but may include other symptoms, such as laziness, lack of social participation, mood changes, apathy, and sleep disturbances.

Other problems are:

• Price: Virtual reality as a new and cool technology faces the problem of high price.

• Selling to other sectors apart from the gaming world.


• Since more of the hype is associated with the entertainment sector, noninvolvement in the other sectors where VR can be useful would affect investments.

• Lots of controversies regarding experimentations. This would eventually dwindle as more people get to understand the technology.

• With the high price of this new technology, it could stay out of reach of the mass population.

• The unknown effects associated with health issues could scare people from getting this new impressive technology.

Need Payoff:

There has been 1200+ companies in these sectors, 258 funded in the last 5 years and $1.2B invested in 2015-16. Leading investors include Boost VC, Rothenburg Ventures, Techstars, Intel Capitals, Andreessen Horowitz, Qualcomm Ventures. Even with some of the problems faced with virtual reality technologies, its sectors have found enormous amounts of funding in these specializations:

Hardware: Manufacturers of VR hardware which help in capturing as well as viewing content. Some companies might provide software along with the device.

This sector has a total investment totaling $1 billion. Investment is usually directed to three:

• Display Devices: Devices which provide a combination of display, sensors, drivers and SDK to make compatible apps. Examples are Oculus VR, AntVR etc.

• Peripheral: Providers of hardware which enable VR inputs, interaction e.g. motion capture, chips & sensors, motion controllers. Examples are Movidius, Leap Motion, IvenSense etc.

• Cameras: Manufacturers of cameras to capture content. Examples are Lytro, 360fly, Matterpoint etc.

Applications: Includes players applying VR technology in various fields like Entertainment, Health, Real Estate, Retail, Tourism etc. Total investments from 2008 till date is $554M.

• Entertainment: Companies developing VR applications for entertainment purpose like immersive videos, events, etc. Examples are NetVR,, Replay Technologies, The Virtual Reality Company, Voke etc.

• Real Estate & Architecture: Companies developing VR solutions for real estate & architecture like visualization from floor plans, platforms to create virtual tours from images, developers of virtual tours. Examples are InsiteVr, Tridfy etc.

• Social: Developers of applications for social interaction e.g. social networking and platforms for various activities through virtual avatars. Examples are AltSpace VR, The Wave VR etc.

• Education: Companies developing applications for education & training as well as offering platform for education content development. Examples are Solirax etc.

• Advertising: Companies employing VR in advertising e.g. VR specific ad network. Examples are AdsOptimal, MediaSpike etc.

Post production: Tools to process content (picture/video) after capture through camera. Total investments since 2008 till date is $225M.

• Publishing platform: Companies offering platform to publish content from pictures/videos. Examples are WakingApp etc.

• Stitching: Software to convert videos/images taken from cameras to a 360 degree content. Examples are Mantis Vision, EveryScape, Paracosm etc.

• End to end solutions: Companies offering end to end post production solutions right from camera rigs, stitching, editing, post processing, distribution platform. Examples are JauntVR, WeVr etc.

• Streaming: Video streaming solutions for VR. Examples are Pixvana.

• Volumetric Capture: Tools for volumetric capture e.g. software, video cameras. Examples are 8i etc.

Developer tools: Software to help developers create VR content artificially through computer. Total investments from 2008 till date is $83M.

• Content Creation: Tools for creating content like software suite for VR content creation, computer vision SDKs for app development, 3D audio creation. Example are Electric Sheep Company, World Wiz etc.

• Metaverse: Companies offering tools to create virtual world as well as operating environment to enable virtual worlds. Examples are Improbable, Linden Lab, High Fidelity, Visionary VR, Hyperfair, Nurulize etc. Input/output/software: Software which helps input / output devices such as motion controllers in gesture recognition, motion tracking, simulation. Total investments from 2008 till date is $56M.

• Gesture Recognition: Developer of tools for gesture recognition. Examples are Eyesight Technologies, Aquifi etc.

• Motion Tracking: Software for motion tracking. Examples are Sail Before, Univrses, Faceshift etc.

• Haptics: Tools for enabling haptic feedback.

• Motion Simulation: Software for motion simulation. Examples are vMocion.

Usefulness of VR Technologies in other Sectors

Usefulness in Health

• The use of VR for remote telesurgery.

• VR techniques used in local surgery such as endoscopy, where the surgeon

manipulates instruments by viewing a TV monitor.

• VEs used as surgical simulators or trainers.

• VEs are also being used to reduce phobias such as agoraphobia and vertigo.

• Therapeutic uses.

• Companies investing: MindMaze (2012, $118.5M).

Usefulness in Education

• Virtual Classes: virtual reality training of astronauts by performing hazardous tasks in the space [Cate95].

Usefulness in other areas

• Empathy: The first-person perspective provided by VR is a powerful tool for causing people to feel empathy for someone else’s situation. The world continues to struggle with acceptance and equality for others of different race, religion, age, gender, sexuality, social status, and education, while the greatest barrier to progress is that most people cannot fathom what it is like to have a different identity.


A lot of advancements have been made using VR and VR technology. VR has cut across all facets of human endeavours - manufacturing/business, exploration, defense, leisure activities, and medicine among others. The exciting field of VR has the potential to change our lives in many ways. There are many applications of VR presently and there will be many more in the future. Many VR applications have been developed for manufacturing, education, simulation, design evaluation, architectural walk-through, ergonomic studies, simulation of assembly sequences and maintenance tasks, assistance for the handicapped, study and treatment of phobias, entertainment, rapid prototyping and much more. VR technology is now widely recognized as a major breakthrough in the technological advance of science.

“If you are investing in virtual reality, what you need to embrace is the cockroach, you need to survive. You need to watch as there is turbulence in the ecosystem. You need to know that will happen around you, be aware of it, and survive that hype cycle. There will be a very exciting period on the other end of it, but expectations are just so high today that there will be – I would say – a bit of a gap to bridge in terms of delivering on the promise of some of those expectations. In a way, where we are today looks a little bit more like the early development of the film industry, where the novelty of watching a train heading straight towards the audience was enough to make an audience say, ‘Oh wow!’ and jump out of their seats. For the near future the novelty is enough.” - Andrew Schoen(VC New Enterprise Associates, a large, global venture capital firm that has been investing heavily in VR projects, from games companies to 360 recording hardware.)


• [Smith94] R. Smith: Current Military Simulations and the Integrations of Virtual Reality Technologies. Virtual Reality World, Vol. 2, No. 2, pp. 45-50 (1994) • [Cate95] J. Cater, S. Huffman: Use of the remote access virtual environment network (RAVEN) for coordinated IVA-EVA astronaut-training and evaluation. Presence, Vol. 4, No. 2, pp. 103-109 (1995) • [Kall93] J. S. Kollin: The Virtual Retinal Display. Proceedings of the Society for Information Display, Vol. 24, pp. 827-829 (1993) • The WWW

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