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VRChat Raises $4 Million Round Led By HTC

VRChat Raises $4 Million Round Led By HTC

Startup VRChat just raised a $4 million Series A round of funding led by HTC.

The money for the social VR startup comes in the wake of AltspaceVR running out of cash and the earlier closure of Convrge, though Altspace found a lifeline of sorts. There’s still High Fidelity running strong and Linden Lab continues building Sansar, the successor to one of the longest-running virtual worlds, Second Life. Plus, social gaming space Rec Room raised $5 million earlier this year while BigScreen saw at least one person spending more than 1,000 hours in its screen-sharing service. It’s also important to note VR platform creators Valve turned its Home space into a social experience too and Facebook launched Spaces.

VRChat (which is also on Viveport) is one of the first social efforts in virtual reality — starting as the project of CEO Graham Gaylor while he was in college and launching on Reddit in January 2014. That’s about the time Mark Zuckerberg was visiting the Oculus offices to check out VR technology. About a month later Gaylor met Jesse Joudrey, a veteran of Electronic Arts who would become CTO. They talked inside VRChat and the two started brainstorming future ideas for the social software. When Facebook acquired Oculus in March that year they decided to turn their VRChat hobby into a real business.

“Not until Facebook bought Oculus did we really know that this was the one killer application of VR,” VRChat’s creators wrote in an email to me. “One of the biggest assets VRChat had then (and still has today) was it’s community. Driven VR enthusiasts who wanted to help build the metaverse. With the core tech built around Unity it made it very easy for users to create avatars, worlds and pretty much anything they wanted using scripting.”

Funding for the startup started in 2015 with a friends and family round, followed by angel investors and a $1.2 million seed round in 2016. One of the first hires was long-time gaming industry veteran Ron Millar, who became chief creative officer, after interviewing in VR. Investors include Rothenberg Ventures, GVR Fund, HTC, Brighstone VC, WS Investment Company.

The company stands at 16 people today, many hired “directly through the VRChat community.” There is no office. They meet in VRChat and work remotely using Slack and Discord.

“We expect to continue work on [VRChat’s] content creation tools for our users to empower them to even greater feats,” the creators wrote.

Update: Rec Room added to the list of other notable VR social efforts.

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