Virtual Reality Startup Virtuix Raises $2.7M, Readies for CES Debut
A Houston startup’s dream of “taking virtual reality beyond the chair” is getting closer to reality.
Virtuix announced today it has raised $2.7 million that it will use to fund its final push to manufacture a treadmill that, when paired with an Oculus Rift virtual reality headset and currently available video game systems, will enable players to control their characters’ movements by walking, running, jumping, and turning on a platform.
The product, named the Virtuix Omni, isn’t a treadmill in the typical sense. The Omni doesn’t have a motorized belt or any moving parts, and players move at their own speed and pick the direction. Game players stand on a stationary convex platform as a harness attached to their waist holds them in place. They wear special shoes and move their feet across the platform to simulate motion.
The Omni is able to track the player’s real-world movements and translate them into commands for the player’s digital character, Virtuix founder and CEO Jan Goetgeluk says. He believes it has solved one of virtual reality’s big problems—how to convincingly simulate locomotion and physical movement through a simulated 3D world.
The goal is near complete immersion in a game through “full virtual reality,” Goetgeluk says. In the case of popular first-person shooter games like “Call of Duty,” with the Omni “you’re in the game, you become the character, you’re walking around, you’re a soldier on the battlefield.”
Goetgeluk says the company has already sold more than 3,500 of its Omni treadmills through pre-orders, and the new investment will be used to build and ship the treadmills to customers in the first quarter of 2015. Some of the investment also will go toward research and development for Virtuix’s future products.
Western Technology Investment and 2020 Ventures are new investors, Goetgeluk says. Radical Investments, Scout Ventures, Scentan Ventures, Tekton Ventures, and private investors reinvested in the company.
Virtuix hasn’t had trouble attracting interest from investors or potential buyers. Virtuix made its debut on Kickstarter in 2013 and raised $1.1 million in its campaign. In April, it raised a $3 million seed round that included an investment from Mark Cuban. The company says it’s raised a total of $7 million.
More than 3,500 Omnis have been preordered. Delivering them to customers has been a challenge, Goetgeluk admits, but that’s a fact of life when developing hardware.
“Bringing hardware to market is hard,” Goetgeluk says. “People underestimate how hard it is to make something, even just to make the machines to make the machines is incredibly hard. So it took us a long time to get to this point when we can start shipping.”
Like many hardware startups that raise money through Kickstarter, Virtuix was optimistic in its belief it could start delivering products within six months. It’s taken a bit less than two years, which Goetgeluk says is the usual length of time hardware startups need to have a consumer-ready product.
But now Virtuix is almost there. The first production run should start soon, and in January the company is heading to Las Vegas for the Consumer Electronics Show to show of the Omni to the public, press, and the industry.
“We’re closer than ever. It’s coming together very nicely, and the product is going to be very nice,” he says.
The treadmills will cost $499, and Goetgeluk says that price is possible because the Omni has no moving parts. The company’s also worked hard to get good deals from its suppliers and manufacturers in China. Goetgeluk says the numbers work out so that the price will lead to nice returns for the company while being low enough that it will be hard for potential competitors to undercut it.
Along with the round, Goetgeluk says the company now is working with advisers Kai Huang and Mike Griffith. Each had a role in creating some of the video game industry’s biggest hits.
Huang co-founded and was CEO of RedOctane, which developed the video game “Guitar Hero” in the mid-2000s. Goetgeluk says Virtuix now is a bit like RedOctane was when it was creating “Guitar Hero.” That game featured a unique controller that simulated a guitar, and it needed to successfully integrate hardware and software, Goetgeluk says.
RedOctane also started out as a small, bootstrapped startup that specialized in making video game controllers before going on to create a franchise that would reportedly account for $2 billion in sales. Goetgeluk believes Huang will help Virtuix understand how to “scale the business and build a mass market entertainment brand.”
Griffith is the vice chairman and former CEO of Activision Publishing, one of the biggest video game companies. In addition to “Guitar Hero,” the company owns the blockbuster “Call of Duty” franchise, which has earned it billions of dollars.
Virtuix will rely on Griffith’s expertise as it comes to understand what types of games work best with its products and to find the “killer app” for its technology, Goetgeluk says.