VR Startup AltspaceVR Says Bye-bye

The news has broken that on August 3 2017 AltspaceVR was shut down. Citing financial difficulties, it was a move that no one outside of the company saw coming, or at least did not see coming so soon after its founding. In fact, AltspaceVR has been around such a short time that most people probably have no idea who they are, other than perhaps as the people who hosted a VR wedding.

So Who Were They?

In 2013 a company called AltspaceVR was launched and in 2015, just before the major VR headsets launched, the company showed the world what it had been working on.

AltspaceVR was started by a former SpaceX employee, a literal rocket scientist , who I can almost imagine thinking “It’s not rocket science” when first thinking up his new company.

That man, Eric Romo, came up with an idea for a social space that would integrate VR technology. Before Facebook’s Spaces was even hinted at, Romo had seen that the future of VR was social.

Follow the Money

So how were these guys going to make money? In a way it was going to be a little like Second Life, the venerable 3D online social platform. Most people using the system would pay nothing, but certain premium and business-oriented features would cost money. 

Call Me Maybe

The idea was that people would meet in VR instead of commenting on social media or talking on Skype. You would all be in a shared virtual space, represented by avatars. It’s a way to feel like you’re in a room with other human beings without actually being in their presence. This is a concept that has since been copied, most notably by Facebook, but AltspaceVR was one of the first to get a product to market.

The software was actually a little ahead of its time. It supported HMD eye-tracking, even though today there are still only a small handful of HMDs that have this tech in them. You could even do motion tracking with a Kinect, so that your avatar would copy your body language.

The company also realised that mobile VR is going to play a big role in the industry and had support for Gear VR and Google Daydream.

So What Went Wrong?

It’s hard to tell exactly why a promising startup like this would suddenly have to close its doors. AltspaceVR reportedly got a decent amount of investment capital and they never had very many employees.

The blog post announcement makes specific points about their reasons for folding. For one thing, their second-round of funding fell through and according to them the slowness of VR market growth was making investors a little sceptical of giving out more cash.

The product had about 35,000 monthly users who each spent 35 minutes a day on average in the VR world, so it really did have potential to become truly popular. After all, given the relatively slow penetration of VR hardware, those numbers were great.

For now however, it doesn’t seem like we’ll ever know how far AltspaceVR would have gone and that’s a real pity.