At Greenlight Insights’ recent 2016 Virtual Reality Strategy Conference, RYOT co-founder, Bryn Mooser and moderator Patricia Glovsky of Polygon Capital discussed RYOT’s acquisition by AOL for an M&A Fireside Chat. The discussion covered a number of topics with an added focus on what fueled RYOT’s growth, the success of RYOT’s acquisition, and what helped RYOT to stand out in the diverse field of 360-degree video content studios.
As Facebook and YouTube were expanding 360-degree video capabilities, RYOT identified these mediums would need content to continue the growth of their services. RYOT recently raised over $3M which was largely fueled by the parallel growth that was going on in these social channels, which allowed RYOT to share their 360-degree videos.
As consumers are exposed to more VR experiences, 360-degree video content will need to be compelling and meaningful to maintain an audience. Greenlight Insights’ 2016 Virtual Reality Consumer Report suggests 47% of those who have experience with both VR and 360-degree video reported they prefer VR experiences. RYOT strives to capitalize on compelling and meaningful content as documentary film is the company’s top mission.
During Mooser’s conversation with Glovsky, Mooser reflected on his first VR film, which followed the aftermath of the April 2015 earthquake in Nepal. The reaction people experienced after viewing it on a Samsung Gear VR inspired Mooser to continue connecting with people. He reflects on people viewing it:
“I remember showing it just on the street in a Samsung Gear VR and... half the people who took off the headset were crying. It’s very rare, as a filmmaker, that you get a line of people to see anything that you make. I think if we had been standing there holding a cell phone and saying ‘Hey! We just shot a video, here’s the YouTube, does anybody want to see it?’ nobody would have wanted to see it.”
When Glovsky asked what Mooser’s “secret sauce” was, he said it was just him and his team being willing to take a calculated gamble. Looking at the number of other companies developing 360-degree content, RYOT could see that a lot of content was being priced way higher than outlets were willing to pay. RYOT was able to capitalize on the space by speeding up the shooting process, editing, and stitching. This allowed RYOT to charge prices closer to what companies were used to paying for non-360-degree digital media.
Additionally, what RYOT’s acquisition shows is that VR/AR company acquisitions are taking place pre-VC funding or during very early funding rounds. According to Crunchbase, RYOT had received no VC funding prior to its acquisition by AOL. This holds true for a number of other large acquisitions that took place in 2016 in the VR industry and demonstrates that as established companies are looking to bring on VR capabilities, they want to get in and grab companies before valuations rise, even if the companies are less market-tested.