Investors can play a crucial role in supporting and growing not just individual start-ups, but the XR ecosystem as a whole. Vive X in Europe’s director, Dave Haynes highlights how HTC see a huge VR opportunity in enterprise (and beyond); and how they are working to foster long-term growth.

By Bernadette Fallon

Dave Haynes is the director of Vive X in Europe for HTC Vive, a role created in 2018 as part of the corporation’s global VR/AR accelerator programme expansion. Joining Vive X’s worldwide locations in San Francisco, Tel Aviv, Taipei, Beijing and Shenzhen, its new European headquarters is based in London. Prior to his appointment Dave was part of the investment team for early-stage seed fund Seedcamp, which invested in VR companies such as SplashVR and TheWaveVR and set up Augmentor, the first UK-based program for VR and AR investment. He was also part of the founding team at SoundCloud where he led business development and content partnerships.

Heading up the European branch of the most active investor in VR start-ups right now aligns Dave Haynes with the programme’s mission to foster and grow the whole XR ecosystem. HTC has already made investments in over 100 start-ups through Vive X since 2016, investing in a wide range of sectors including mixed reality platforms, such as LIV, and start-ups like Neurable, working on brain computer interfaces.

“Vive X is our $100m global VR/AR accelerator, with a mission to help cultivate, foster and grow the global VR ecosystem by supporting start-ups and providing them with education, investment and mentorship.”

This year, he reveals, HTC sees a huge VR opportunity in enterprise, which is a fast growing opportunity for Vive.

“VR has been in the innovation labs of large multinational companies for several years but now they’ve built their proof of concepts and are starting to deploy headsets and solutions across the enterprise, to cut costs or improve processes. Key areas include training, design visualisation and virtual collaboration. And we’re looking for scalable platforms and products that have the potential to become the de facto solution in their industry vertical or across a horizontal use case.”

He points to examples such as Immersive Factory, building a training platform focused on health and safety, which is a recent investment for Vive and one that is already selling to large enterprises including Veolia, Saint Gobain and Volvo.

Their work also extends to the creative sphere.

“We’ve funded a number of creative companies through Vive X including several that provide the ‘picks & shovels’ for other people in the XR ecosystem to be more creative. For example, a product that KageNova is building helps 360 film makers produce more interactive content. Whilst LIV helps content creators to stream live mix reality from their VR apps to large audiences on Twitch and YouTube.

“Outside of Vive X, we also have a number of projects such as Vive Arts, which helps creative companies and institutions that are creating unique cultural experiences that can be accessed across the world. You can check out all the latest projects here.”

The brand’s development and publishing initiative, Vive Studios, works with the industry’s top content creators to turn creative concepts into reality and bring projects to life that go far beyond just gaming and entertainment.

“A recent example is 7 Miracles a feature-length 360 film that picked up the ‘Spirit of Raindance: VR Film of The Festival’ at the Raindance Film Festival in London,” he says.

“Vive Studios believes that investing in excellent content will allow our development partners to generate revenue and profit, helping the virtual reality ecosystem to thrive and prosper. There’s no set way that they fund creative content but they’re always actively seeking VR content from creative companies across key categories, for VR ranging from healthcare and education, to design and entertainment.”

But it’s not all about VR.

“Our investment thesis at Vive X centres around HTC’s vision of ‘Vive Reality’, by which we mean the accelerating convergence of a number of new technologies including, VR, AR, AI, blockchain and 5G. With the recent launch of our HTC 5G Hub we see a new generation of use cases being unlocked, which I believe could enable a new wave of billion-dollar investment opportunities, just as 4G and smartphones enabled huge successes like Instagram and Uber.”

Outside of Vive X, Dave points to several of his other projects, such as Vive Arts, that are helping creative companies and institutions make unique cultural experiences that can be accessed across the world. Find out more about the latest projects here.

And while recent reports show that investment in VR technologies slowed in 2018, Dave is very positive about the situation as it currently stands in the UK.

“The rate of R&D coming out of the UK feels healthy. One of our recent investments, KageNova, has a technical team who are solving some hard problems to create more interactive immersive experiences. In building their start-up they tapped into the collective research they’ve already been doing in academia for years. So, there’s no shortage of strong R&D, but there’s still plenty of scope to increase the amount of investment available to grow new companies and commercialise.”

Vive X is already working hard to achieve this but not only that, the company is also focused on evangelising what it is doing across the investor community.

“To create a healthy ecosystem, we still need to invest both time and money.”

This is where the Virtual Reality Venture Capital Alliance (VRVCA) comes in, explains Dave, another HTC-led initiative in the form of an alliance of venture capital firms formed to foster long-term growth in the XR industry through identifying, sharing and investing in the world’s most innovative and impactful VR technology. The alliance meets several times a year in different locations and will be coming to London for the first time this year.

When it comes to advising start-ups on securing investment, Dave’s experience and insights are invaluable.

“My biggest piece of advice is to make sure you have a founder on your team who has mastered the art of storytelling. Whether it’s to raise capital or to hire the best people, you’re going to need to sell the big vision around what you’re doing. That’s even more relevant if you’re working on frontier technologies like VR and AR.”

He has also collected his top six tips for raising seed funding for a VR start-up, including creating the perfect demo, proving your technology can solve a key problem and not wasting time predicting future market size.

“I’ve seen enough market slides to know that anyone can make their industry sound big. And it’s usually bullsh*t. Nobody knows future market size. You can use proxies, and you should be able to talk a good game but modelling more precise numbers at this stage is likely not the best use of your time.”

“Getting a read on market size for early-stage start-ups is usually instinctual. The more disruptive your business, the more this is true. You can find data and triangulate towards something meaningful, but usually an investor just wants to see your thinking around how the market is moving, does it feel large and which part do you plan to address, both now and then later.”

Vive X will be actively looking for new investments later this year but, in the meantime, Dave says he is always happy to connect with new start-ups to see where help can be given. As mentioned earlier, HTC is bringing the VRVCA to London in May and will be looking for companies that are looking to raise their next round of financing and for VC’s that are interested to join a VRVCA meeting for the first time.

And there’s much to be gained for innovative start-ups looking to grow.

“As part of Vive X, we don’t just invest money but look to add value to the companies by working with them closely, whether that’s finding new customers, helping with fundraising or getting them access to new products.”

In the world of Vive X and its support for new enterprises, the future is looking healthy.

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