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VR Startup Snags Europe's Largest VC Funding of 2017

By ValueWalk
Venture Capital

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Improbable, the London-based maker of a platform used by developers to build enormous virtual worlds, recently announced an equity financing in excess of half a billion dollars at a reported valuation of more than $1 billion, pushing the company squarely into unicorn territory.

Announced on Thursday, the transaction is one of the biggest VC deals ever for a European startup. Add that to the company’s place at the forefront of the burgeoning VR industry—and the fact that the round is being led by SoftBank, which has itself been the subject of recent headlines—and it becomes even more noteworthy.

The largest Europe-based venture deals of 2017

VR startup VC funding

*iZettle’s €165M round did not make the top list because only €60M of it was raised in 2017

A measuring stick in Europe

The $502 million investment in Improbable is among the largest VC fundings for a European startup in recent years—and the very largest since the beginning of 2017, according to the PitchBook Platform.

SoftBank’s push continues

Japanese telecom giant SoftBank (TKO: 9984) led the financing for Improbable, with executive Deep Nishar joining the company’s board. The conglomerate has become increasingly involved in tech investing, with several large-scale deals under its belt over the past few years. SoftBank struck again on Friday, leading a $360 million investment in Guardant Health, the developer of a tool used to treat cancer.

As of now, SoftBank’s investment in Improbable won’t come from the company’s Vision Fund, a massive tech vehicle that’s reportedly nearing a $95 billion close. But Improbable could pick up backing from the vehicle at some point in the future. The partnership with SoftBank means Improbable could raise even bigger rounds from the telecom company in the years to come.

VCs continue to flock to VR/AR

Improbable is deeply immersed in the VR world. The company’s platform, called SpatialOS, relies on data centers to help users create massive simulations, with the ultimate mission of creating virtual situations as large and complex as the real world.

Applications of Improbable’s technology include video games, of course, but the platform has also been used for larger-scale projects, including an in-depth simulation of a city, per The New York Times. “We are already working on projects with telecommunications companies, governments and other enterprise clients to explore the ability of massive, detailed simulations to drive better decisions using real-world data,” the company said in a blog post announcing the funding.

The VR/AR sector has been the focus of much attention in the tech world in recent years. Well-known companies to receive significant funding include Magic Leap, a developer of AR eyeware, and NextVR, the maker of a virtual reality platform for enhancing live sports and entertainment.

You can learn everything you need to know about the VR/AR space in our recent VR/AR Breakdown.

Article by Dana Olsen, PitchBook

This article was originally published in ValueWalk.

Photo: Rock Cohen

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