Don’t quit your job to do an AR/VR Startup yet
Every few years a new building block of technology starts to take shape and with it comes a wave of enthusiasm, not only from early-adopters but early-builders. Early-builders are the entrepreneurs and developers who just can’t resist the appeal of building something with the new technology. This year, we’ll have ARKit as the new shiny tech to build on top.
I won’t talk about the technology aspect of ARKit, but I’ll give the same advice to entrepreneurs and developers I gave when the Apple Watch came out: Don’t bet on it!
Numbers don’t lie
If you are doing anything direct-to-consumer, meaning, you’ll make money by either people paying directly to you or by monetizing the audience size (e.g. advertising), ARKit will not allow you to build a sustainable business. The numbers are not there yet.
First, it’ll take a while for adoption to take hold. Even though it might be available in hundreds of millions of devices in the first month, it’s not like hundreds of millions of people will know about it. Even if they do, how many will take the time to look for apps that support it? Your app will be competing with hundreds of other apps for the attention of this small subset of enthusiasts.
Second, the first generation of apps will not be that great. It takes time for us to learn how to build appropriate interaction modes and content that fits the medium. You might remember how early websites looked like digital brochures and early mobile apps looked like shrunk websites.
The best AR app won’t be an AR app
With a few exceptions, the technology is not the destination. People won’t be looking for an AR app. However, if you are building a new app in which AR is part of the experience (even if a critical part), you’ll have a better chance. Usually, these type of apps are about something else: fashion, home decor, engineering, astronomy, medical, construction, etc.
The companies positioned to make the best use of it are not the new ones trying to make AR the thing, but those that already have a product and that’ll be significantly enhanced by AR.
For example, when Home Depot, Ikea, Celestron, Nordstrom, Amazon, and others add AR features to show you how your room will look in a different color, a new sofa in the corner of your living room or a French beret on your head, it’s when AR will become mainstream. Not when you launch the “Hat AR App.”
But what about the infrastructure…
Yes, there is a platform play here. One in which you can help other companies more easily include ARKit into their apps. The Twilio of AR. The companies that will be very well-known and create the first generation of services to support the use of AR have been founded already. If you are just starting a company for AR Analytics, AR modeling, ARKit abstraction for multiplatform use, AR optimized cloud storage, etc., you are too late!
What’s the opportunity?
Time is your enemy. There is no short-play in AR. If your goal is to build something that could get significant traction in just a couple of years, you might be better off looking somewhere else. If you are in it for the long-run, be prepared for 3–5 years of a slog, just like it took Bitcoin about five years to cross the chasm.
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