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But while the Invact story has been widely publicized, the winter of funding in the launch space coincides with the launch of the metaverse faster than many other sectors.
Mint spoke to another Delhi-based co-founder who left his metaverse headlines last month after a disagreement with another founder and major investor. In that case, the metaverse firm was made part of the platform for major events, according to the man.
Metaverse firms, which have been seeking to make money with the web3 craze since last October, have begun to lose the thinking space of investors. According to founders, corporate firms and analysts, the industry is beginning to view metaverse startups as risky investments, therefore, they do not want to invest in them given current funding, caused by global inflation and future recession.
Another founder, who runs a funded implementation that focuses on non-fungible tokens (NFTs), and plans to build a platform around it, said investors are reluctant to agree with the metaverse product vision, even though they are willing to look. in crypto and NFT operations. “It’s very difficult to sell that idea to them,” he said.
Insiders say the reintroduction of Facebook giant Facebook to Meta last October gave the unpopular real-time launch of taxpayers (AR) and virtual reality (VR) a second chance, but most of them were exhausted before that.
“We have looked closely at the metaverse (space) for the last 10-12 months. Our view is that as much as technology supports, is important and should remain, business models in this space are not yet strong enough, “said Rajesh Sehgal, manager of Equanimity Investments. As a result, Equanimity is not investing. , the return type of play. Therefore, people would spend a fraction of what they have in this space, “he added.
Sehgal also said the need for such investments is likely to decrease with the decline in risk appetite.
Another person, who has invested in some of the country’s biggest startups, said that in order to get distribution, these startups first need a platform, which is not yet available.
“Companies often make a pivot based on a buzzword. As a result, we have also seen a number of AR / VR companies become more flexible in the last two years. It’s a good re-branding, ”he said.
In addition, the investor said the potential market capitalization of this launch is only in the millions at the moment and is not enough to make any investment. Researcher International Data Corporation (IDC) said in a March report that only 11.2 million AR / VR headsets were sold worldwide by 2021, however, an increase of 92 percent last year.
“How much money can you make to get all those customers, right? You can not spend $ 100 million to build a product that will be used by 8 million customers, “said the investor, adding that this has forced more VCs out of the metaverse space. , data does not support that, “he added.
“For Facebook or Microsoft to support certain technologies and new business models with minimal financial exposure or performance. I see those companies as evangelists trying to do something with the ecosystem, ”said Sehgal, noting that $ 100 million may not make as much difference to the American tech giant as a small company, which is its own company. the question of life and death.
Not just investors but. A study conducted by researcher Gartner earlier this month noted that while senior executives are still committed to technology such as artificial intelligence (AI), 63% of them do not see flexibility as a viable technology in their businesses.
That being said, not everyone is giving up on these initiatives yet and those with the best products can still be optimistic. Some say Facebook, Microsoft etc will eventually look to find smaller, stronger firms that can see a return there.
For example, the investment platform LetsVenture, which invested in the industrial platform Fabrik last month, has said it will continue to invest in launching the space.
“While we see the Indian market developing many products and features in the past and in the present, India will definitely help shape the metaverse concept,” said Nakul Saxena, head of fund strategy and investor relations at LetsVenture.