Oculus Rift secures $16 million in venture capital

Oculus Rift has secured $16 million in venture capital funding, which it plans to use to roughly double its workforce and build new prototypes.

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Oculus Rift has not only caught the eyes of gamers, but the interest of investors. The new funding will allow for more prototypes and experiments, and the eventual release of a consumer version of the much buzzed-about VR headset.

A Kickstarter update states that the money will be put towards hiring more staff from among "the best and brightest minds in VR from around the world." CEO Brendan Iribe told Forbes that it plans to roughly double its current staff of 30.

"Virtual reality will be one of the most significant technologies of the 21st century. It has the potential to drastically alter the way we play, communicate, and learn," the post says. "I want to thank everyone for their support. None of this would be possible without you, the people who supported Oculus when it was nothing but a rough prototype and a dream of changing gaming forever!"

Oculus Rift was one of many subjects bantered about on the latest Weekend Confirmed, gathering buzz coming out of E3. Development kits shipped in April, but the company has not yet set a date for the consumer version.

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  • reply
    June 18, 2013 4:00 PM

    Steve Watts posted a new article, Oculus Rift secures $16 million in venture capital.

    Oculus Rift has secured $16 million in venture capital funding, which it plans to use to roughly double its workforce and build new prototypes.

    • Ziz legacy 10 years
      reply
      June 18, 2013 4:06 PM

      I can see it now!

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      June 18, 2013 4:07 PM

      yeeesssssssss

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      June 18, 2013 4:09 PM

      Tell me that workforce includes Tori Black, please.

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      June 18, 2013 4:52 PM

      Links to the portfolios of the VC companies they've teamed up with:

      http://www.matrixpartners.com/portfolio/#/current-all

      http://www.sparkcapital.com/portfolio/

      Not too shoddy track records. I kept thinking it'd be funny if Nintendo stepped in with their piles of cash and bought them out. Now, who knows...

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        June 19, 2013 9:29 AM

        If only Gunpei Yokoi was still around.

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      June 18, 2013 5:33 PM

      1080p coming sooner right?

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        June 18, 2013 6:19 PM

        1080p is old news, we want 4k.

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        June 18, 2013 7:25 PM

        They had a 1080p mock up at E3 but they want better.

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          June 18, 2013 7:28 PM

          It's more that 1080p by itself isn't enough. They still have other issues related to VR they need to solve beyond just the resolution. My understanding is that the 1080p prototype is one of a series they do for research where they change just one aspect of the unit to see how it impacts everything else. Ultimately I'd expect them to take the best innovations from all of those and package them together. For example I bet they have a prototype with some form of positional tracking as well.

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      June 18, 2013 6:37 PM

      when can I buy one of these already?

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      June 18, 2013 6:47 PM

      [deleted]

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      June 18, 2013 6:56 PM

      Wait until you see clients actually fund the VC Funds. When I was a public auditor I had VC clients and the contributors of each Fund (individual VC investment) had partners (both General and Limited) who all ranged from pension funds (private and public), rich people (One VC based in the Silicon Valley had a lot of former 49ers players like Joe Montana, Merton Hanks, etc), banks, other VC's (this one was the most fun because at different VC's I saw the web of interconnecting VC's), and then contributors which were trusts with a name and a date. The latter was basically kids whose parents set up trust funds for them and most of the kids where less than 10 years old. Some partners had bigger shares of the Fund than others too (10% versus 2%). Most partners weren't active in the VC but some partners took more active roles and meet with the VC and even go to the funded company to see what they're investing in. The VC itself manages the Fund on a daily basis and also charges a management fee like 2% of the entire Fund over its life.

      With VC's all that money that Oculus Rift got in article aren't getting it all at once. A VC fund is set up with contribution commitments that are promised by the partner over the life of the Fund. For the sake of simplicity, OR's $16 Million is divided up between 16 partners (people, banks, funds, other VC's, etc) who each contribute $1 Million each over five years. The life of the VC can vary between two years or more. During the life of that Fund a Captial Call is made periodically for each partner to pay their share of the Fund. They can evenly spread out the capital calls or call them as needed. Sometimes there's limits to $200K a year max, it depends on the Fund. Each Capital Call is a percentage of the contribution so they can call for 5% from each partner's share so that's $50,000 from each partner. Cap Calls are usually put out with a deadline ranging from a week to a month. Then they wait another month or more for the next Cap Call. A Fund can be asked to fund a larger amount than usual in the case of some expenses like prototyping or the cost for life sciences have to pay to get regulatory approval done. I've seen a Cap Call made before when a company needed to pay for lawyers because they were being sued over patent infringement.

      The VC's have Distributions as well which is the reverse of a Cap Call so the Fund pays back the partner their share and sometimes with profit. Ultimately for a VC, the Funded company is expected to go public upon which the partners get the best stocks during IPO. Second best option is the company funded gets bought by a bigger one (this is quite common for VC Funded companies in tech or life sciences) and the partners are reimbursed for their share in the company as VC's become shareholders in the funded company. Next is that they get their contribution back with interest from the company as the VC helped them to complete their product/service and now are making revenue. Worst case is the company flops and the parters don't get all of their investment back but they can write off the loss anyways.

      I guess the biggest caveat is that the $16 Million isn't coming all at once, they're just guaranteed that much over a set time of the VC Fund's life. Still VC's contribute Billions of investment every year to small and private companies in tech, life sciences, and software.

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        June 19, 2013 12:23 AM

        Also, from looking at who these funds are, it's safe to say that a role they may take on is a facilitator for OR to be bought out entirely by a much larger company or concern. People shouldn't be too shocked if they sell their company shortly before or after the product is fully ready to go to market (but you know the internet will be, anyways).

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          June 19, 2013 7:18 AM

          Seems like adding members from the backing companies to OR's board is a good way to start that process. Is that a normal part of VC negotiations?

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      June 18, 2013 6:57 PM

      Awesome, awesome news.

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      June 18, 2013 7:25 PM

      I really hope these don't cost $300 retail.

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        June 18, 2013 7:31 PM

        are you hoping they'll be cheaper?

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        June 18, 2013 7:34 PM

        I'm guessing they'll be slightly more expensive but that's still ridiculously cheap.

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        June 18, 2013 7:37 PM

        The devkit is $350 shipped. I don't see how the retail version could be $300.

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          June 18, 2013 7:41 PM

          what are you trying to say here?

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          June 18, 2013 9:45 PM

          It could be, but given economies of scale it'll probably be cheaper.

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        June 18, 2013 7:42 PM

        I would drop 300 on the 1080p version in a second. Definitely not a consumer repro version of the devkit though. The screen is shit.

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          June 18, 2013 10:27 PM

          The screen is shit and the experience is still amazing. Even making it a notch better where you can read text reliably would make for the most amazing deal at 300.

          Add in positional tracking and I put on my revolution pants.

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        June 18, 2013 8:12 PM

        I'd rather pay for a $1000+ high end product than a $300 cheaper version. Hopefully they release different models for different price ranges instead of just one standard product.

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          June 19, 2013 9:11 AM

          They already stated they won't. They'll get one product right out and that's it (and one has to assume, improve on it when possible).

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        June 18, 2013 8:22 PM

        I think with the level of developer support for it it could be worth it. As long as they don't give people a motion sickness that doesn't go away lol.

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        June 18, 2013 8:38 PM

        id pay triple that for HD version if its as good as people say

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        June 18, 2013 9:44 PM

        That would be an amazing deal.

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        June 18, 2013 9:45 PM

        a good monitor is at least $300 so it seems completely reasonable to me.

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        June 18, 2013 11:27 PM

        I'd pay 1000 for a 6 DOF, 1080p each eye unit. I mean... easily. Just like that.

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          June 19, 2013 7:01 AM

          Yep word. That's still cheaper than a lot of other units out there.

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            June 19, 2013 9:33 AM

            Exactly. And it's better in a lot of ways to even some of the super expensive ones because of the focus on low latency.

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        June 18, 2013 11:46 PM

        Yeah, I can't see myself paying $300 for one, and I want one.

        Wishful thinking I know

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          June 18, 2013 11:51 PM

          How much would you pay for a monitor or video card? This could be the next major leap in video games, bigger perhaps than anything the next generation of consoles could bring. I could easily imagine this being a needed device if you're a fan of PC games, and its potential goes beyond even that.

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          June 18, 2013 11:58 PM

          Think of it like buying a monitor. Once the features stabilize a bit I don't imagine you'll be upgrading this thing every year, more like every few PC generations like we do with monitors these days. In that light, $300 really isn't very much at all.

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          June 19, 2013 6:36 AM

          You should definitely work on that whole "being poor" thing :(

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        June 19, 2013 12:05 AM

        Seriously? I'm amazed they're not speculating $500+

        TrackIR alone is $150.

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        June 19, 2013 12:17 AM

        I'd pay over $1k for a VR headset that delivers a proper "this is the future" experience. A HD Oculus Rift with positional head tracking seems to fit that bill.

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        June 19, 2013 12:39 AM

        That's actually quite a deal considering. My three 24" monitors eyefinity monitors cost me close to $900 and in 2005 one 24" LCD cost me more than that!

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        June 19, 2013 12:47 AM

        That's a fair price. A decent monitor costs more than that.

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        June 19, 2013 3:11 AM

        I'd pay anywhere between $300-$500 for the commercial set if they deliver on their promises. It is a total game changer in my eyes, comparable to color tvs or graphics cards, if not more.

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        June 19, 2013 4:58 AM

        If IRacing supports it I'll pay up to 500 for 1080.

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        June 19, 2013 6:47 AM

        I know, right? I would easily pay $1k for such a device.

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        June 19, 2013 9:10 AM

        Really? $300 is a fucking steal if they use the HD screen.

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      June 18, 2013 10:40 PM

      Why?! Who asked for these goggles?

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      June 19, 2013 12:26 AM

      what are the hardware requirements of these bad boys? is it just the resolution x 2, or do they have a FPS requirement ala 3d?

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        June 19, 2013 12:28 AM

        You need to be able to render two views side-by-side each at roughly half resolution at a steady 60fps

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          June 19, 2013 1:48 AM

          I thought the device itself did all of that stuff? Or does your cpu/gpu do all of that?

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            June 19, 2013 8:30 AM

            It works like a monitor and a controller. The computer does all the work.

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            June 19, 2013 9:29 AM

            The actual device is really simple. It's little more than a screen, optics and a tracker

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              June 19, 2013 10:51 AM

              The *idea* is simple, I don't think those individual parts are as simple to implement as you might think.

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                June 19, 2013 11:08 AM

                I'm not saying that coming up with the idea was obvious, but the actual device is not very complex. It's an LCD screen and some lenses. You could put one together yourself if you wanted to but you'd wouldn't have the same tracker or the API or anything. The things in there that are more impressive technologically are the homegrown tracker and the API, not the configuration of lenses and screen and whatnot.

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                  June 19, 2013 1:05 PM

                  That's probably true, although I don't know if the lenses are completely obvious either, maybe they are.

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                    June 19, 2013 1:28 PM

                    They are, they use software to compensate for using cheap* lenses.

                    Cheap as in not $3,000 per lense. VR equipment is insanely expensive.

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          June 19, 2013 7:25 AM

          Yeah you need the 60fps or you get sick.

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        June 19, 2013 9:01 AM

        There's no "x2", you just need to be able to run a game at the resolution of the device (at a high frame rate). The resolution of the panel is split across both eyes so that the effective resolution for a 1920x1080 panel is 960x1080, it's not like the stereoscopic glasses model where you need to render the entire screen twice.

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          June 19, 2013 9:23 AM

          excellent. won't even require a full on trigger rig. this sounds like a game changer.

          have they spoken to console support?

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            June 19, 2013 10:49 AM

            I don't think there's any official word on such a thing. Obviously since the next-gen consoles are really just PC's there's no technical reason why that wouldn't be possible. Certainly from a hardware side it will work. The problem would be with software support and of course whether the console makers feel comfortable enough with the feature set and level of polish to integrate support into their API's.

            Other considerations include... Whether it's basically seamless to calibrate, and whether next-gen console developers are committed to supporting 60 FPS gameplay. It's a harder sell if they aren't, because it means that they have to start having to create different versions of the game with different performance characteristics, which is commonplace in the PC world but not nearly as much on consoles.

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          June 19, 2013 11:12 AM

          No, you do have to render the scene twice, but each time can be at half the resolution of the full screen. Rendering at half resolution may increase performance somewhat but it won't necessarily be twice as fast as rendering at the full resolution so there's still some significant overhead involved.

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            June 19, 2013 1:02 PM

            That's true, and an important distinction, but I imagine that it would be close to the performance of a single full resolution render.

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              June 19, 2013 2:01 PM

              Consider that games aren't generally fillrate limited these days as much as they were in the past, lowering resolution doesn't buy you the kind of performance it used to.

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                June 19, 2013 2:21 PM

                What are they limited by?

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                  June 19, 2013 2:52 PM

                  Depends but other possible limiting factors are geometric complexity, physics complexity, texture sizes and probably a whole bunch of other stuff I haven't mentioned.

                  This isn't to say nothing is fillrate limited, but my understanding is that it's far less of an issue than it used to be and lowering resolution doesn't pay off to the same extent that it used to.

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                    June 19, 2013 2:55 PM

                    Also consider that having to render the scene twice from two separate viewpoints means that many screen-space effects will need to be run twice, once for each eye. In a number of games that have been retrofitted with 3d rendering, shadows only appear for one eye, for example because it's only doing them the first time.

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        June 19, 2013 9:14 AM

        It only uses one monitor. So the resolution of the device (1280x800 now, 1920x1080 in the future). But it also requires 60fps to work well.

        My computer has been handling everything preeeeeetty well.

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      June 19, 2013 12:41 AM

      Wow does that thing look awkward and clumsy. Nice try but get rid of the goggles and get back to us.

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