Samsung has been bullish on virtual reality hardware, hoping that its early moves in headsets and devices to shoot content will give it a stronger position in the space as (and if!) it continues to expand to more applications and users. Now TechCrunch has learned that as part of that effort, it’s also made an acquisition. Samsung quietly bought a New York-based startup called VRB, which has developed several apps to capture and view 360-degree content.
One source claimed the deal was valued at $5.5 million; another said it was significantly less than that, $1.5 million.
We have reached out both to VRB and Samsung for comment, but in the meantime one of the co-founders, Chrisopher Paretti, has responded to a message we’ve sent him to confirm the sale. “VRB was acquired by Samsung, but the deal amount will remain undisclosed,” he wrote.
There have also been several proof points of the deal hiding in plain sight.
The terms of service for one of VRB’s apps describes VRB as “a division of Samsung Research America, Inc.”, while the company’s two iPhone apps (here and here) list Samsung Information Systems America as their developer. Meanwhile, VRB’s AngelList page tells us that VRB was acquired by Samsung Electronics on April 17 this year. And its Twitter, Instagram and Facebook feeds stopped getting updated some time ago.
The AngelList profile also notes that Samsung Next, Samsung’s accelerator program where VRB was incubated, was an investor.
VRB had a somewhat low profile in the startup world prior to its acquisition — no CrunchBase profile, no Product Hunts, very few name checks in the media (hat tip to PC Magazine for covering it here) — but it has an interesting pedigree.
Co-founder and CEO Christopher Paretti is a veteran of Nokia, Samsung, Gree and Yahoo, where he held senior positions in design, and he was also a design and product advisor at Peer, which was acquired by Twitter last year. His co-founder Christopher D. Kairalla is an assistant adjunct professor at NYU who has held several technical roles at startups in the past whose specialisations include video and interaction.
VRB itself appears to have worked on a mixture of services in the general area of VR. It described itself as a “social VR platform centered around user expression and novel methods of communication”, and it filled that out with both B2C and B2B products — a double-purpose route we’ve seen other startups take, since it helps them both build a platform and provide a proof of concept for that tech.
On the consumer side, VRB had developed two apps, one a “social city” called VRB Home and the other a 360-degree photo-sharing app called VRBFoto. The latter you can see in live VR apps for Oculus and VR Gear.
Here’s one example of an image shared on VRBFoto, from one of the co-founders:
On the developer side, VRB had created a multi-purpose toolkit for VR content creators that included an extensible avatar creator, a headset-to-mobile broadcasting tool, and persistent backend system “to help users create virtual worlds that are shareable, friendly, and meaningful.”
It’s not clear what Samsung has planned longer term for the product, technology and team it’s picked up, but the fact that it’s continued to keep the apps live could be a sign of how it plans to continue their development as applications for its hardware.
According to recent figures, Samsung’s Gear VR headset is the market leader in terms of shipments. In 2016 it dominated the market with some 5 million units sold, compared to 3.6 million for the next-most popular model, the Oculus Rift, with 2.1 million units for HTC’s Vive. It has also recently started selling a new Gear 360 camera in the US after an initial launch in Europe.
But one of the issues in the VR industry has been that some feel that there hasn’t been enough killer content, to attract buyers to the products. Indeed, that was one of several problems with early smartphones gaining critical mass, too, until Apple and Google cracked the nut with their app stores.
Although third parties have been slowly developing their own content, by buying VRB, Samsung appears to be putting an investment into building its own content and tools to develop it, too.
Interestingly, after Samsung acquired the AI assistant Viv (which we later saw would be used for its own voice-powered assistant Bixby), it was reported that it was looking for more AI startups to snap up.
But in a left-turn, VRB appears to be the first VR startup that Samsung has acquired (or at least the first that’s been uncovered), although there are rumors of more purchases related to VR in the pipeline, and there are yet other acquisitions Samsung has made that fit into the wider VR ecosystem, such as its acquisition of cloud computing firm Joyent and automotive electronics firm Harman for its connected car efforts.
Update: Samsung Next provided the following statement to TechCrunch:
“We built the ‘Start In-Residence’ program to attract talented entrepreneurs who could leverage the best of Samsung’s resources and build a startup with the potential to strengthen Samsung’s capabilities. VRB’s success is an example of how we empower talented founders with a strong vision, great ideas and the boldness to see it through to scale. We’re very proud of the VRB team and what we’ve accomplished together.”