AR/VR market transition begins as startups raise record $3.6 billion

Augmented and virtual reality startups raised over $3.6 billion from venture capitalists and corporates in the last 12 months to the end of Q1 2018, setting a new record. Over three-quarters of a billion dollars was invested in the first three months of this year alone.

A fundamental transition in the fundraising market towards AR from VR, as well as the very early-stage dynamics of mobile AR, is driving an acceleration of fundraising trends we anticipated at the start of the year. As expected in a transitional year, overall deal volumes declined slightly in the short-term as VCs and corporates look to medium-term mobile AR and long-term smartglasses growth.