Why Investors Are Turning Away from Metaverse Startups

Investment in the metaverse, virtual reality (VR), and augmented reality (AR) sectors continues to decline, with these startups attracting less capital compared to previous years. Disappointing adoption rates for related technologies and platforms contribute to waning interest among venture capitalists. Apple's introduction of the Vision Pro headset at $3,500 did not significantly boost demand, leading to a reduced shipment forecast. Around $464 million has been invested in 2024, making it the lowest funding year in recent times. Notable companies like Magic Leap and Niantic Labs have not secured new funding rounds since the 2021 peak. However, some sizable financings continue, such as Rokid raising $70 million for AR glasses and Beijing-based Xreal securing $60 million for mixed-reality glasses.

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