Niantic rises $300M at a $9B valuation to build the ‘real-world metaverse’

Niantic rises $300M at a $9B valuation to build the ‘real-world metaverse’

Niantic, the augmented reality platform behind Pokémon GO, has secured $300 million from Coatue, valuing the firm at $9 billion. This money will used to construct the “real-world metaverse,” according to the San Francisco-based business, which was spun out of Google. Niantic founder and CEO John Hanke has called the metaverse a “dystopian nightmare” since August, at least the one that binds us to VR headsets like in “Ready Player One.” 

Unlike Facebook, which changed its name to Meta to reflect its involvement in virtual reality technology, Niantic wants to create technology that connects individuals to the outside world. Niantic announced the Lightship AR Developer Kit (ARDK) earlier this month, which makes tools for developing AR games publicly available free to anybody with a basic understanding of the Unity game engine.

“At Niantic, we think that the happiest humans are those whose virtual world leads them to a physical world,” Hanke stated at the time. “Unlike a science fiction metaverse, a real-world metaverse will employ technology to enhance our understanding of the reality we’ve known for thousands of years.”

The money will go toward expanding the ARDK, which has already used to build augmented reality experiences for Coachella, Historic Royal Palaces, Universal Pictures, SoftBank, Warner Music Group, and the PGA of America. As a result, rather of relying on technology like VR headsets, which are currently out of reach for the majority of the public, AR initiatives mostly, rely on smartphones to inspire people to explore their surroundings. 

For example, you may pass by the same painting every day, but in Pokémon GO, a user-generated Pokéstop description may reveal what that artwork means. Tens of millions of users play Niantic’s games each month, walking more than 10.9 billion miles since their introduction, according to the company.

“Niantic is developing an augmented reality platform based on a 3D model of the environment that we believe will be essential in the next computing revolution,” said Matt Mazzeo, a general partner at Coatue. “We’re pleased to collaborate with Niantic because we envisage this infrastructure enabling a metaverse for the real world and powering the internet’s next generation.”

Although Hanke considers the VR metaverse to be “dystopian,” AR, like any technology, has flaws. Pikmin Bloom, Niantic’s newest game, built around walking, which may be off-putting to older or handicapped gamers. Disabled gamers in Pokémon GO exist, but they have had to speak up about how tiny in-game changes may make the game far more accessible for those with restricted mobility.

Nonetheless, Niantic’s vision is a viable alternative to Meta’s headset-reliant strategy. According to app analytics firm Sensor Tower, Pokémon GO is still a tremendous hit, with sales exceeding $1 billion in 2020 and on course to exceed that this year. Not all of its games are as popular; the business just announced that Harry Potter: Hogwarts Mystery will discontinue.

Wizards Unite has seen a 57 percent reduction in in-app consumer expenditure and worldwide installations year over year. We will see how far the notion of a “real-world metaverse” can go once independent developers get their hands on Niantic’s Lightship ARDK.