Future of tech

CB1#CBIFrontierTech
CBINSIGHTSTM
THE
FUTURE OF
FRONTIER
TECH
Analyzing trends in
drones, space, and AR/VR
technology
AUGUST 28, 2015

CB2#CBIFrontierTech
Space companies include those that are working on a variety of problems
related to “The Final Frontier”. That includes startups tackling more
traditional space-related technology such as space travel and rocket
propulsion, as well as more contemporary technologies like satellite
imagery, asteroid mining, space debris cleanup, and much more.
Drones includes all unmanned aerial vehicle (UAV)-related companies
including the manufacturers of the drones themselves, technology related
to the operation of drones, as well the supporting infrastructure around it.
Augmented reality & virtual reality includes all companies related to the
usage or support of these platforms. This includes AR/VR advertising
platforms, software, and hardware, as well as companies that utilize AR/VR
for other commercial purposes.
DEFINITION OF FRONTIER TECH
Frontier Tech | noun |Fruhn-teer Tek:
Technology related to drones, space, augmented reality, and virtual reality.

CB3#CBIFrontierTech
KEY FIGURES
$3.2B, 183 deals since 2014
$1.9B, 45 deals since 2014
$285M, 58 deals since 2014
$1B, 80 deals since 2014
TABLE OF CONTENTS
# SECTION
4 Highlights
5 Frontier Tech Summary
11 Space
22 Drones
37 AR/VR

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FRONTIER TECH INVESTMENT
ACTIVITY EXPLODES
GOOGLE A LEADING
INVESTOR
NANOSATELLITES
DRIVING MULTIPLE SPACE
INVESTMENTS
DRONES GAINING
MOMENTUM
AR/VR BOLSTERED BY
GAMING EARLY ON
Overall investment activity to startups within the space, drone, and AR/VR ecosystems
has come on strongly since 2014, raising $3.15B across 183 equity investments. This
has been driven by breakout funding rounds to category leaders such as SpaceX, Magic
Leap, OneWeb, and DJI.
Google (now Alphabet) has been a strategic investor and acquirer within the frontier
tech space over the years. Google Ventures tied for the most active VC since 2012,
while Google corporate has made multiple investments of its own, as well as a $500M
acquisition of Skybox Imaging, a satellite imagery company, in 2014.
While SpaceX has dominated overall funding to space startups, multiple companies
focused on either the deployment or utilization of nanosatellites have received funding
since 2012. With an estimated 2000 nano and microsatellites to be launched over
the next 5 years, startups ranging from Accion Systems to Orbital Insights all will be
participating in this segment of the space startup ecosystem.
Drone investment activity has now increased for 4 straight quarters, reaching an all-
time high in Q2’15 at $109M raised across 16 deals. Investments since 2012 have
largely been focused on the hardware, software, and services side, with just 18% of
funded companies tackling infrastructure.
Augmented reality and virtual reality investments have reached double digits in 6 of
the last 7 quarters. Multiple use-cases continue to drive investment activity, however
gaming could be the first leading use-case, as it accounted for 76% of all VR content
made last year. In addition, major corporates such as Valve, Tencent, Sony, and
Microsoft have shown significant interest in AR/VR gaming.
SUMMARY OF FINDINGS

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Since 2014 nearly
$3.2Braised in equity financing to frontier tech companies

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FRONTIER TECH STARTUPS RAISE NEARLY $3.2B SINCE
2014, CLOSE TO $2.2B IN FIRST HALF OF 2015
Frontier tech startups (focusing on space, drones, and AR/VR) have raised a combined $3.15B in
equity financing since 2014, across 183 deals. Funding has now topped $500M and 30 deals for
three straight quarters, with Q1’15’s $1.3B in funding being the highest quarterly total of all-time,
largely buoyed by SpaceX’s $1B Series D financing. As the industries develop, there have been 9
$50M+ financings to frontier tech companies since 2014.
FRONTIER TECH INVESTMENT ACTIVITY
Q1’12 - Q2’15
$35 $86 $20 $17
$57 $68
$119
$256
$88 $74
$144
$671
$1,307
$866
9 8 8
6
11
15
17
24 23
17
24
31
48
40
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1200
1400
Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15
FrontierTech Investment Activity
Q1'12 - Q2'15
Dollars ($M) Deals

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ROTHENBERG VENTURES AND GOOGLE VENTURES LEAD
MOST ACTIVE VC INVESTORS SINCE 2012
Rothenberg Ventures and Google Ventures have been the most active VCs in frontier tech
companies since 2012. Rothenberg Ventures has made multiple early-stage bets including
Altspace VR, Matterport, and Dronebase. A number of VC firms rounded out the top 3.
MOST ACTIVE VCS IN FRONTIER TECH
Unique Companies, Q1’12 - Q2’15
RANK INVESTOR RANK INVESTOR
1 Rothenberg Ventures 3 Intel Capital
1 Google Ventures 7 Felicis Ventures
3 Andreessen Horowitz 8 Founders Fund
3 Qualcomm Ventures 8 Bessemer Venture Partners
3 Lux Capital 8 Promus Ventures

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While the splashiest
acquisitions in recent years in
frontier tech were acquisitions
by Facebook and Google, there
have been few investor-backed
exits overall. However, multiple
companies have made
acquisitions within the space,
drone, and AR/VR industries.
These notable M&A
transactions include:
• KMel Robotics, acquired
by Qualcomm in January
2015
• Modelco, acquired by
Goliath Games in April
2014
• Composite Engineering,
acquired by Kratos Defense
& Security Solutions in May
2012.
Other Notable Exits
The maker of the Oculus Rift, a
virtual reality headset with use-
cases ranging from gaming to
media and more.
A commerical remote sensing
company that utilized satellites
to provide insight into daily
activity on the planet.
Acquired by Facebook, 3/14
$2 billion
Acquired by Google, 6/14
$500 million
Provides end-to-end solutions
across geospatial value chain
including satellite operations,
imagery distribution, and more.
Aims to provide a near-live
HD video feed of earth with
multiple cameras attached to the
International Space Station.
Acquired by Planet Labs, 7/15*
Undisclosed
IPO via Reverse Merger, 7/13
$63.5 million**
NOTABLE INVESTOR-BACKED FRONTIER TECH EXITS
SINCE 2012
* This acquisition took place in Q3’15, however was included in report for informational purposes.
** There is some uncertainty due to the reverse merger in Urthecast’s valuation at time of IPO. For up to
date valuation data the company’s ticker is UR:CN.

CB9#frontiertechreport
Google & Qualcomm Lead
Strategics
CORPORATE INVESTMENTS AND ACQUISITIONS
As the graph to the left shows,
Google and Qualcomm,
through both their corporate
and venture arms, have been
very active in the frontier
tech space with multiple
investments and acquisitions.
Other corporates visualized
include Airware, which has
made multiple investments
through its recently launched
Commercial Drone Fund,
as well as Bosch, and Intel
Capital.
DJI & Accel Partners (not
visualized) recently announced
a similar fund to Airware’s
called the SkyFund.

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“It’s one of the few things
I’ve ever experienced in
my life where I came out
and said, ‘This changes
everything. This is a marker
of the future.”
Thomas Tull
CEO, Legendary Entertainment,
speaking about Magic Leap
INVESTOR INVESTMENTS
OTHER NOTABLE STRATEGIC INVESTMENTS
Source: Fast Company
Image Source: Gage Skidmore

Since 2014
SPACEcompanies have raised more than
$1.8 billion

SPACEX BUOYS SPACE INVESTMENT ACTIVITY, DEALS
REACH MULTI-YEAR HIGH IN Q1’15
Space startups raised $1.76B in the first half of 2015 as both funding and deal activity have
increased in recent quarters. Mega-rounds to SpaceX ($1B) and OneWeb ($500M) have buoyed
funding totals. Other notable financings in 2015 include Planet Labs’ $70M Series C, which valued
the company at $500M, Mapbox’s $50M Series B, and Spire’s $40M Series B.
SPACE INVESTMENT ACTIVITY
Q1’12 - Q2’15
$7 $70 $17 $1 $16 $64 $131 $7 $45 $25 $24
$1,124
$6293
2
3
0
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4
5
9
7
5
2
9
13
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$0
$200
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$800
$1,000
$1,200
Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15
Space Investment Activity
Q1'12 - Q2'15
Dollars ($M) Deals

LUX CAPITAL, RRE VENTURES, BESSEMER ARE MOST
ACTIVE VCs IN SPACE STARTUPS
Lux Capital, RRE Ventures, and Bessemer Venture Partners have been the 3 most active VCs
in space startups since 2012. Both Bessemer and RRE invested in Spire, a company hoping to
put over 50 small satellites in space over the next few years to achieve daily imaging of earth.
Bessemer also invested in Skybox Imaging, which was acquired for $500M by Google in 2014.
MOST ACTIVE VCS IN SPACE
RANK INVESTOR SELECT INVESTMENTS
1 Lux Capital Planet Labs, Orbital Insight
1 RRE Ventures Spaceflight Industries, Spire
1 Bessemer Venture Partners Spire, Skybox Imaging
2 Khosla Ventures Rocket Lab, Skybox Imaging
2 Promus Ventures Spire, Mapbox
2 Founders Fund Planet Labs, Accion Systems

Designs, manufactures, and
launches advanced rockets and
spacecrafts.
Plans to put more than 600
satellites in space to enable global
internet access.
Collects/analyzes data about the
earth via agile satellite constellation
development.
Total Funding
$1.19 billion
Total Funding
$500 million
Total Funding
$196.1 million
Develops a new form of satellite
antenna to connect mobile
networks and communication
satellites.
Collects/analyzes data via satellite
constellations related to global
trade, weather, and more.
Map data, design, and publishing
platform.
Total Funding
$82 million
Total Funding
$69.4 million
Total Funding
$60.6 million
THE MOST WELL-FUNDED VC-BACKED SPACE STARTUPS

“Compared to other industries, I have never seen such an
enormous margin for improvement. There’s this canonical
thing about a startup needing to pitch a 10X improvement
to be a worthwhile investment. You rarely see an
entrepreneur pitch a 100X improvement. But in space we’ve
seen 1,000X, and really we’ve seen 10,000X.”
- Steve Jurvetson
Partner, Draper Fisher Jurvetson
Source: Fortune

Of all space companies funded
since 2012, 46% have been
focused on space services or
rocket tech. These include
companies like SpaceX, which
is developing reusable rocket
technology, as well space debris
cleanup startup Astroscale.
Satellite startups accounted for
35% of the funded companies,
which includes multiple
startups aiming to capture
images of earth via satellites
on a daily basis, such as Planet
Labs, and Spire.
Imagery startups, like Orbital
Insight and Windward, which
utilize satellite imagery to
derive unique insights about
earth, accounted for 19% of
backed companies.
SATELLITES AND ROCKET TECH ARE LEADING
CATEGORIES
FUNDED SPACE COMPANIES BY FOCUS
As % of all funded companies, Q1’12 - Q2’15
35%
46%
19%
Funded Space Companies by Focus
Satellite Operation/Tech
Space Services/Rocket Tech
Imagery

SELECT SPACE STARTUPS BY SEGMENT
SATELLITES SPACE SERVICES/ROCKET TECH IMAGERY

SPACE STARTUPS: LAUNCHES, AMBITIONS, AND
SETBACKS
Startups gathering and analyzing data from space
utilize emerging satellite imagery technology
to provide unique insights to a wide range of
industries, including maritime, weather, wildlife
conservation, and economic indicators.
The surge in innovation has not come without
setbacks. Recently a launch failure by SpaceX
negatively impacted many satellite startups, which
utilize SpaceX rockets as launch vehicles to put
satellites into orbit.
PARTNERSHIPS & USE CASES BROADER TRENDS

Nanosatellites are significantly smaller and affordable satellites that many of today’s
space technology companies are utilizing. Cubesats, which led the nanosat movement,
emerged in 1999 out of Cal Poly San Luis Obispo and Stanford in an effort to get
aerospace companies to launch low-cost satellites for research. Since then, multiple
startups have raised financing to deploy larger constellations of these satellites into
low-earth orbit in an effort to upend existing players such as Airbus and DigitalGlobe
in earth imagery. These startups, such as Planet Labs and Spire, look to utilize the
lower-cost, larger constellations to gather imagery of the earth at a much higher rate
(called the “revisit rate”), with eventual goals to have daily or even multiple daily
satellite images of any given location on earth.
The use-cases borne out of this unprecedented cost efficiency and agile development
when it comes to satellite imagery frequency are abound. However, the imagery
analysis often lays in the hands of companies like Orbital Insight and Windward, which
utilize deep learning to analyze large datasets.
The addressable markets span both public and private sectors. These include financial
institutions, which analyze construction, parking lot traffic, crop health for commodity
trading, and more, to national weather services, which can utilize sensors on the
nanosats to gather better data and provide a clearer picture of weather patterns, to
governments, which can analyze imagery to detect deforestation and environmental
impact of areas over time.
Industry Analysis: Nanosat/microsat Imagery Enablement
Image credit: Planet Labs

2000+ $5B 56%Nano/microsats projected to launch
from 2014 to 2020
Projected global commercial satellite im-
agery market in 2019
of nanosats will be for commercial use
through 2016
Market Sizing
Source: Spaceworks, The Economist, Transparency Market Research

Diversified aerospace and defense
company with a small focus
on larger commercial satellite
development
Diversified aerospace and defense
company which has delivered more
than 300 observation satellites for
commercial use
Diversified aerospace company
which builds a range of satellites,
including the 900 satellite OneWeb
constellation
Market Cap
$98.2 billion
Market Cap
$66.2 billion
Market Cap
$54.6 billion
HQ: Chicago, IL HQ: Bethesda, MD HQ: Blagnac, France
Provides launch services to
largely smaller telecommunication
satellites
Leading American provider of
high-resolution satellite imagery
including powering Google Maps
Acquired Skybox Imaging, a small
satellite company focused on twice-
daily imaging of earth
Market Cap
$4.8 billion
Market Cap
$1.8 billion
Market Cap
$465 billion
HQ: Dulles, VA HQ: Longmont, CO HQ: Mountain View, CA
NANOSATELLITE/MICROSATELLITE IMAGERY RELATED
CORPORATES

Since 2014
DRONEcompanies have raised
$285 million

DRONE INVESTMENT ACTIVITY PEAKS IN Q2’15
Drone investment activity has picked up markedly over the past three quarters, reaching an all-
time high in Q2’15, with $109M invested across 16 deals. The funding total was buoyed by the
$75M Series B financing to DJI Innovations, the largest consumer drone manufacturer in the
world. Other notable deals include 3D Robotics’ $14M Series C-II, and Squadrone Systems’ $5M
Series A.
DRONE INVESTMENT ACTIVITY
Q1’12 - Q2’15
$2 $8
$16
$32
$8 $6 $13
$65
$23
$68
$109
1
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Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15
Drone Investment Activity
Q1'12 - Q2'15
Dollars ($M) Deals

NUMBER OF VCS WITH MULTIPLE DRONE BETS IS STILL
FAIRLY LOW
Few VCs have made multiple bets on drones thus far. The 10 VCs below are those with multiple
unique company investments in the drone ecosystem. Notably 5 of the 10 VCs have invested in
Airware, the developer of an operating system for drones.
MOST ACTIVE VCS IN DRONES
INVESTOR INVESTOR
Promus Ventures Commercial Drone Fund
Google Ventures Qualcomm Ventures
Andreessen Horowitz Draper Associates
Felicis Ventures Intel Capital
Accel Partners SK Ventures

Autonomous drone/UAV
manufacturer with a focus on
enterprise
Consumer and semi-pro drone
manufacturer
Develops autopilots and an
operating system for drones/UAVs
Total Funding
$99 million
Total Funding
$75 million
Total Funding
$40.2 million
Enterprise services for capturing
data at scale with autonomous
drones
Manufactures multi-rotors and
various hardware for drones
Develops tethered drone
technology for persistent flight and
secure streaming
Total Funding
$21.4 million
Total Funding
$20 million
Total Funding
$14.9 million
THE MOST WELL FUNDED VC-BACKED DRONE STARTUPS

“It’s blindingly obvious to us that this is going to be a big
space...It’s tough to know how big it will be, but where I
stand here on the foothills, I can see the mountains in the
distance and they’re pretty high.”
- John Frankel
Partner, FF Venture Capital
Source: Bloomberg

42% of all funded drone
startups since 2012 have been
focused on software/services.
This includes “Uber for drones”
startups such as Dronebase, as
well as more industrial focused
companies like Skycatch.
Drone hardware startups were
a close second in terms of
funded company share at 40%.
However, hardware startups
have garnered the most
investment dollars, as the two
most well-funded companies
(3D Robotics and DJI) are
focused largely on hardware.
Drone startups focused on
infrastructure, such as drone
defense startups DeDrone and
Droneshield, made up just 18%
of funded companies since
2012.
HARDWARE, SOFTWARE & SERVICES DOMINATE
INFRASTRUCTURE DRONE STARTUPS
FUNDED DRONE COMPANIES BY FOCUS
40%
18%
42%
Funded Drone Companies by Focus
Hardware
Infrastructure
Software/Services

SELECT DRONE COMPANIES BY APPLICATION
HARDWARE SERVICES/SOFTWARE INFRASTRUCTURE

PARTNERSHIPS & USE CASES GROWING CONCERNS
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DRONES MOVING FORWARD: NEWS HEADLINES
Multiple companies have developed innovative
partnerships or experimental trials within
the drone space. Ranging from military use
to agriculture to industrial monitoring, drone
utilization currently spans a wide array of
industries.
But not all is perfect. A mix of slow regulation
of drones in the US, as well as a slew of
infrastructure issues still remain. Below are
relevant news headlines for each aspect of the
emerging drone space.

The FAA Section 333 Exemption
process allows drone operators
to legally utilize drones for
commercial purposes. Thus far
there has been a relatively slow
ramp-up for issuances, however
in recent months the FAA has
increased the issuance rate.
As of 07/2015, 44% of all
Section 333 exemptions
have gone to for Film/Photo/
Video use-cases. This includes
companies that are utilizing
drones for movies, as well as
applications for real estate
agents and artists, among other
things.
Inspection and Monitoring
has seen the second highest
issuance rate, at 26%, while
Mapping and Surveying for land
and commercial construction,
rounds out the top 3 at 15%.
FAA SECTION 333 EXEMPTIONS FOR DRONES
FAA DRONE EXEMPTIONS BY USE-CASE
as of 07/2015
Source: Drone Analyst
44%
26%
15%
9%
4% 2%
Drone FAA Approvals
Film / Photo / Video
Inspection / Monitoring
Mapping / Surveying
Precision Agriculture
Public Safety / First Responders
Other

Drones have been combined with other industrial IoT products in a new wave
of precision agriculture to increase efficiency of crop yields, mitigate a variety of
crop risks, and subsequently lower the costs of key agriculture inputs including
water and fertilizer.
Drones’ ability to get closer to the land than planes, as well as a low regulatory
barrier due to private land and visual line of sight restrictions (if non-commercial)
has led to fast adoption of drone technology related to precision agriculture.
In fact, of the 850+ FAA Section 333 exemptions (the exemption given for
commercial drone use in the US) 81 have been related to precision agriculture,
trailing film/video, inspection/monitoring, and mapping/surveying.
The use-cases for drones in precision agriculture largely focus on two areas:
Analysis: Terrain feature detection, estimation of crop yields, and farm surveying/
monitoring.
Deployment/Operations: The cost-efficient deployment of fertilizers, precise
agricultural machinery routing, and irrigation equipment monitoring.
Industry Analysis: Precision Agriculture

2.1M $198B $2BFarms in the US US crops annual cash receipts Agriculture monitoring market
Market Sizing
Source: Karlsson Project, USDA

Diversified agriculture and
genetically engineered seeds
Agriculture machinery and software
manufacturer
Agriculture equipment
manufacturer
Market Cap
$48.2 billion
Market Cap
$28.8 billion
Market Cap
$4.8 billion
HQ: St. Louis, MO HQ: Moline, IL HQ: Duluth, GA
Field management software
development through Dupont
Pioneer
Autonomous farm equipment and
connected farm software
Precision agriculture deployment
and analytics technology
Market Cap
$48.8 billion
Market Cap
$5.1 billion
Market Cap
$702.7 million
HQ: Wilmington, DE HQ: Sunnyvale, CA HQ: Sioux Falls, SD
PRECISION AGRICULTURE RELATED CORPORATES

Drones delivery has not yet had widespread adoption, however the advantages are
clear. With current technology, drones would allow businesses to deliver products to
customers without utilizing a driver, and do so in a near instantaneous fashion. As
consumer behavior shifts towards “on-demand”, this trend only looks to accelerate as
multiple startups and corporates look to lower fulfillment times to same-day or sooner.
Drones currently have the ability to carry smaller payloads of up to 5 lbs (which
Amazon claims covers ~86% of all packages it ships), over distances of 5-10 miles,
while utilizing GPS and awareness sensors to navigate between waypoints. Corporates
including Amazon, Domino’s, Google, and startups like Matternet have run pilot tests
in the logistics space.
Outside of the US, developing nations’ difficult infrastructure and lowered government
restrictions make for an even more readily available opportunity, as prohibitive roads
and traffic are removed as factors for delivery over distances. In fact, China’s SF
Express presently delivers between 500-1000 packages per day via drone.
As drone technology advances, expect to hear more about drone-based delivery,
despite government regulation continuing to slow movement toward a drone-riddled
sky in the US.
Industry Analysis: Drone Delivery
Image Source: Frankhöffner

0 $97B 7.5%FAA Approvals for commercial drone
delivery
US Courier & Local Delivery Market Drone delivery cost as % of traditional
ground transportation delivery
Market Sizing
Source: IBIS , John Swope

Largest global package delivery
company.
Second largest package delivery
company
Diversified courier and logistics
Market Cap
$92 billion
Market Cap
$46.7 billion
Market Cap
$34.6 billion*
HQ: Atlanta, GA HQ: Memphis, TN HQ: Bonn, Germany
Has expressed interest in drone
delivery tech with Project Wing
Multi-product e-commerce with a
focus on drone delivery through
Prime Air
Diversified Asian technology entity
with heavy focus on delivery and
logistics related to e-commerce
Market Cap
$465 billion
Market Cap
$249 billion
Market Cap
$185.4 billion
HQ: Mountain View, CA HQ: Seattle, WA HQ: Hangzhou, China
DRONE DELIVERY RELATED CORPORATES
* market cap reflects Deutsche Post AG, the parent company of DHL

Since 2014
AR/VRcompanies have raised
$1.0 billion
Image credit: Microsoft Sweden

AR/VR DEALS REACH NEW HIGH IN Q1’15, ABOVE 10
DEALS 6 OF LAST 7 QUARTERS
After Magic Leap’s $542M financing drove Q4’14 funding to $623M across 12 deals, AR/
VR investment activity reached a record high in Q1’15 with 22 deals raising $114M. Funding
increased slightly in Q2’15 on 7 fewer deals, however the 15 deals still meant that 6 of the last 7
quarters had 10+ AR/VR deals. While the bulk of the deals remain at the early-stage, there were
over 5 $10M+ financings in the first half of 2015.
AR/VR INVESTMENT ACTIVITY
Q1’12 - Q2’15
$26 $16 $3 $9 $55 $36
$24
$117
$75 $16 $54
$623
$114 $128
5
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Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15
AR/VR Investment Activity
Q1'12 - Q2'15
Dollars ($M) Deals

Developer of augmented reality
technology
Visual sensing for connected
devices and augmented reality
Develops a system for generating
3D digital models of physical
spaces.
Total Funding
$592 million
Total Funding
$86.5 million
Total Funding
$58.3 million
Augmented reality visual browser
for brands and publishers
3D motion control and sensing
hardware and software
Cinematic VR experience via
proprietary hardware and software
Total Funding
$47.2 million
Total Funding
$44.1 million
Total Funding
$35.4 million
THE MOST WELL FUNDED VC-BACKED AR/VR STARTUPS

ROTHENBERG VENTURES IS MOST ACTIVE VC IN AR/VR
Rothenberg Ventures has been the most active VC in AR/VR startups since 2012. The early-stage
fund’s investments include AltspaceVR, Matterport, and EmergentVR, among others. Rothenberg
Ventures also operates the River program, which is focused on AR/VR opportunities. Google
Ventures, Andreessen Horowitz, and Intel Capital all placed second in activity, with both GV and
A16Z investing in MediaSpike, a VR native advertising company.
MOST ACTIVE VCs IN AR/VR
RANK INVESTOR RANK INVESTOR
1 Rothenberg Ventures 5 Qualcomm Ventures
2 Google Ventures 5 High-Tech Gruenderfonds
2 Andreessen Horowitz 5 Formation 8
2 Intel Capital

AR/VR startups with a focus
on commercial use-cases
accounted for 40% of all
funded startups since 2012.
These include Blippar, which
enables augmented reality for
brands and publishers, as well
as Augment, which utilizes AR
for sales and e-commerce.
Hardware, which includes
multiple companies developing
hardware platforms for AR/VR
applications, saw the second
highest company share at 34%.
Gaming/Social was third,
while a few startups such as
Deepstream VR and LensAR
are focused on healthcare
applications within the AR/VR
realm.
MAJORITY OF FUNDED AR/VR COMPANIES FOCUSED ON
HARDWARE & COMMERCIAL APPLICATIONS
FUNDED AR/VR COMPANIES BY FOCUS
34%
40%
22%
4%
Funded Drone Companies by Focus
Hardware
Commercial
Gaming/Social
Healthcare

“VR will be the ultimate input-output device. Some people call
VR ‘the last medium’ because any subsequent medium can be
invented inside of VR, using software alone.
Looking back, the movie and TV screens we use today will be
seen as an intermediate step between the invention of elec-
tricity and the invention of VR. Kids will think it’s funny that
their ancestors used to stare at glowing rectangles hoping to
suspend disbelief.”
- Chris Dixon
Partner, Andreessen Horowitz
Source: Cdixon.org

SELECT COMPANIES BY AR/VR APPLICATION
HARDWARE COMMERCIAL GAMING/SOCIAL

PARTNERSHIPS & USE-CASES BROADER TRENDS
AR/VR MOVING FORWARD: NEWS HEADLINES
VR is still at its earliest stages in terms of
commercial applications, however multiple
partnerships have resulted in experiments with
the emerging technology. These include sports
teams, healthcare professionals, and even
astronauts.
In addition to the commercial applications of
today, a wide range of future implementations
are in development. From virtual travel to
government implementations to long-term
health simulations, AR/VR implementation could
fundamentally change human behavior.

Augmented reality and virtual reality are anticipated to have a dramatic impact
on the gaming sector in the next 5-10 years. Large corporates ranging from
Facebook, with its $2B acquistion of VR hardware developer Oculus VR, to
Microsoft and Sony with AR/VR headsets of their own, to Samsung and Google
with their low-cost cardboard headsets designed to work with high-end mobile
phones, are positioning themselves within the space.
Alternatively, software providers including game studios such as Crytek and
Ubisoft look to benefit from a new, more immersive gaming experience and
surging adoption of hardware. Emerging use-cases within gaming include
adaptations of adult-focused open-world games and first-person shooters, as well
as the teen and young adult-focused social gaming where the role of avatars and
digital goods will be increasingly important.
Industry Analysis: AR/VR Gaming
Image credit: Sergey Galyonkin

76% $74B $225Mof VR content related to gaming Overall gaming market VR Gaming Market
Market Sizing
Source: Superdata Research
Image Source: Leonard Low

Largest exclusive American
developer and distributor of video
games including EA Sports
Game developer and publisher
including Call of Duty, World of
Warcraft, Destiny, and Diablo
Video game developer responsible
for Half Life and Dota 2, as well as
digital distribution platform Steam
Market Cap
$22.7 billion
Market Cap
$20.91 billion
Market Cap
$3 billion (estimated)
HQ: Redwood City, CA HQ: Santa Monica, CA HQ: Bellevue, WA
Diversified investment holding
company with largest gaming sales
in the world including video game
publisher Riot Games
Owns Sony Computer
Entertainment which produces
the Playstation line of consoles
and publishes video games across
console and mobile platforms
Owns Microsoft Studios which
develops and publishes games for
the Xbox, Windows, and Steam
platforms including Halo
Market Cap // Gaming Revenue
$171 billion // $7.2 billion
$34 billion // $6 billion
$375.9 billion // $5 billion
HQ: Shenzhen, China HQ: Tokyo, Japan HQ: Redmond, WA
AR/VR GAMING RELATED CORPORATES
Gaming Revenue Source: Newzoo

WHAT IS INCLUDED:
Equity financings into AR/VR, drones, and space startups as of
6/30/2015
• Fundings of only private companies. Funding rounds raised by
public companies of any kind on any exchange (including Pink Sheets)
are excluded from our numbers even if they received investment by a
venture firm(s).
• Only include the investment made in the quarter for tranched
investments. If a company does a second closing of its Series B round
for $5M and previously had closed $2M in a prior quarter, only the
$5M is reflected in our results for that quarter.
• Round #s reflect what has closed –not what is intended. If a
company indicates the closing of $5M out of a desired raise of $15M,
our numbers reflect only the amount which has closed.
• Only verifiable fundings are included. Fundings are verified via
(1) various federal & state regulatory filings (2) direct confirmation with
firm or investor or (3) press release.
WHAT IS EXCLUDED:
• No contingent funding. If a company receives a commitment for
$20M subject to hitting certain milestones but first gets $8M, only the
$8M is included in our data.
• No business development/R&D arrangements whether
transferable into equity now, later or never. If a company signs a
$300M R&D partnership with a larger corporation, this is not equity
financing nor is it from venture capital firms. As a result, it is not
included.
• No buyouts, Consolidations and Recapitalizations. All three of
these of transaction types are commonly employed by private equity
firms and are tracked by CB Insights. However, they are excluded for
the purposes of this report.
• No private placements. These investments also known as PIPEs
(Private Investment in Public Equities) even if made by a venture
capital firm(s)
• No debt/loans of any kind (except convertible notes). Venture
debt or any kind of debt/loan issued to emerging, startup companies
even if included as an additional part of an equity financing is not
included. If a company receives $3M with $2M from venture investors
and $1M in debt, only the $2M is included in these statistics. When
dealing with “most well-funded” companies, debt is included.
• No government funding. Grants, loans, equity financings by the
federal government, state agencies or public -private partnerships to
emerging, startup companies are not included.
METHODOLOGY - WHAT’S INCLUDED? WHAT’S NOT?
We encourage you to review the methodology and definitions employed
by us to better understand the numbers presented in this report. If you
have any questions about our definitions or methodological principles,
we encourage you to reach out to us directly.
Additionally, if you feel your firm has been under represented please
send an email to info@cbinsights.com and we can work together to
ensure your firms investment data is up-to-date.

CBINSIGHTSTM
CB Insights is a National Science
Foundation backed company
that uses data to provide VCs,
corporate strategy, M&A teams
and business development
professionals with intelligence
on emerging companies and
disruptive technology trends.
CB Insights is based in NYC,
is revenue-funded with an
amazing talented team and
growing like a weed.
To see how our data can
make your life easier, visit
www.cbinsights.com
www.cbinsights.com [website]
@cbinsights [Twitter]

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