What better way to pitch a virtual or augmented reality startup idea than to strap a bunch of headsets on the heads of venture capitalists and turn a basic presentation into an immersive experience that demonstrates the potential of your company’s technology?
That’s what Pixvana did — and it worked.
The Seattle startup today announced a $14 million Series A investment led by Paul Allen’s Vulcan Capital, with participation from new investors like Raine Ventures, Microsoft Ventures, Cisco Investments, and Hearst Ventures. Previous backer Madrona Venture Group, which led the company’s $6 million seed round, also joined.
Pixvana has developed a cloud-based end-to-end platform called SPIN Studio that helps virtual reality filmmakers edit, process, and deliver video at 8K resolution. Many storytellers are forced to use desktop tools that weren’t built with VR in mind, creating problems like long rendering times, limited editing capabilities, and less-than-ideal resolution. Pixvana’s SPIN Studio utilizes cloud infrastructure and VR-centric editing software designed from the ground up. Early customers range from sports teams to restaurants to media companies that are starting to film and produce VR content.
Pixvana, founded in late 2015, calls its software “the platform for XR storytelling,” which encompasses virtual reality, augmented reality, 360-video, and other next-generation video experiences.
“There is tremendous opportunity in the XR video space and it is clear that outstanding content and storytelling tools will define this new medium,” Stuart Nagae, general partner at Vulcan Capital, said in a statement. “We think that Pixvana has an extraordinary team that really understands how to deliver cinematic, immersive experiences in XR and can build a SaaS business at scale.”
To understand Pixvana’s underlying technology, it’s best to watch content in virtual reality. Pixvana CEO Forest Key knew this, so as he went to pitch the company’s idea to more than 50 investors for the Series A round, he brought headsets with him and showed a version of the video below — essentially a pitch baked into a VR experience from Pixvana’s office.
Key told GeekWire that a traditional way to pitch investors would be to show a PowerPoint presentation and then move to a VR demo.
“We found that when you do that, someone goes in and out and just tries a little,” he said in an interview at Pixvana’s HQ in Seattle’s Fremont neighborhood. “They don’t really experience it.”
Instead, Pixvana wanted investors to immerse themselves with the video, which shows clips from Seattle Sounders matches; ballet performances; restaurant tours; and more, all to demonstrate the type and quality of content that Pixvana helps create.
Key, who previously sold Seattle hotel marketing startup Buuteeq to Priceline in 2014, would ask investors what they saw — many noted the soccer or ballet.
“I’d tell them that the main thing they saw was a 15-minute corporate presentation,” Key said. “They kind of got lost in it.”
And that was the point — to show investors how Pixvana’s software enables any storyteller to produce “XR” content.
“It was a way to differentiate,” Key noted. “It worked in a way where we got to put our money where our mouth is and use our own technology.”
Key detailed the making of the pitch video in a blog post here.
A marathon, not a sprint
While Pixvana may have a robust platform for “XR” storytelling, it remains to be seen if virtual and augmented reality reaches mainstream consumers despite the hype and investment in the industry over the past few years.
Key tells investors that Pixvana won’t single-handedly create a mass market for VR — that will be up to tech giants like Facebook, Microsoft, Google, Samsung, Sony, and others.
But the CEO likes where his 24-person company is positioned. Key said that from the beginning, he and his co-founders predicted 2020 for a breakout year for XR storytelling. The CEO pointed to the continued development of cheaper and better quality headsets.
“We love our timing,” Key added. “If the market was really big already, we’d be too late. I feel like we are right about where we want to be for maximum possible market value creation. Of course I’d like there to be more headsets and for our technology to be more complete, but the truth is, it’s a little more of a marathon than it is a sprint.”
Since it raised its initial seed round two years ago, Pixvana has added big-name customer partners like Valve and expanded to more platforms like Windows Mixed Reality while adding features to its software.
Now the additional cash infusion will help the company go to market. Key said he gets together regularly with CEOs from other Seattle-based VR startups and they all agree that these “next two or three years is where it gets really interesting.”
“We are barely getting going as an industry, but we are not barely getting going as a technology play,” Key added. “Pixvana has a very interesting technology stack and we are very well positioned as leaders in this part of the market.”
The quality of Pixvana’s Series A investors is also notable, with companies like Microsoft and Cisco getting involved. Investors are clearly still excited about the potential of VR; VentureBeat noted that investments in entertainment VR is up 79 percent over the past year.
“We’re very excited to be working with this set of investor partners — together they bring a collective passion for VR and expertise in building and scaling technologies that are fundamental to the immersive media future in VR and AR,” Key said.
Though Key’s last company was involved with online hotel booking, he spent a good chunk of past few decades working in digital media. After studying film history at UCLA, he started his career at Lucasfilm on the visual effects team before moving on to places like Adobe and Microsoft where he helped develop important web-based video technologies like Flash and Silverlight.
Key’s co-founders have impressive resumes, too, with expertise in software platforms, visual effects, video production, codecs, and content creation. Chief Technology Officer and Creative Director Scott Squires is a well-known Sci-Tech Academy Award winner known for his visual effects work and also a veteran of Lucasfilm. Chief Product Officer Bill Hensler was previously the senior director of engineering at Apple where he worked on photo apps and imaging technologies, while VP of Product Management Sean Safreed is the co-founder of film and video software startup Red Giant.
Pixvana, a Seattle 10 company in 2016, is one of many new up-and-coming virtual reality startups in the Seattle area. Others include Pluto VR, HaptX, VRStudios, VREAL, Endeavor One, Nullspace VR, Against Gravity, Visual Vocal, and several others. Those are in addition to larger companies like Microsoft, Valve, HTC, and Oculus that also are developing virtual and augmented reality technologies in the region.