The technological innovation of the Metaverse still needs to wait for key nodes

The Metaverse is still far away, as difficult as landing a man on Mars.

The technological innovation of the Metaverse still needs to wait for key nodes

The technological innovation of the Metaverse still needs to wait for key nodes

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GGV Investment Notes is what GGV Capital has seen, heard and thought about investment, business, and technology, and discusses everything about the world.

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The following is issue 124 of the GGV Investment Note .

Source | Blue Hole Business (ID:value_creation)

Written | Zhao Weiwei Guo Chaofei

No one can accurately predict the development form of the Metaverse, but this does not prevent the investment foundation of this industry from being found first, that is, technology and investment bets.Then explore the technical path in this direction and its landing point, and finally “see the technology-driven thing that brings enough quality difference”.

In the past two years, GGV did not take the “Metaverse” as the track, but aimed at the track of “entertainment technology”, and bet more than a dozen startups around the technology path. Such asCocos game engine, game content and engine developer Buming Technology, entertainmentintelligent AI Kaiyuan World , virtual production company Suihua Technology , next-generation social engine BUD , graphics algorithm platform Taichi Graphics , virtual human Gemsouls , etc.

Investment is the unity of rationality and sensibility, and the future of the Metaverse and entertainment technology is also a community intertwined with technology and aesthetics.

The following is Luo Chao, executive director of GGV Capital, sharing his views on entertainment technology:

The technological innovation of the Metaverse still needs to wait for key nodes

Waiting for a critical turning point

Q: When did you start watching the Metaverse track?

Luo Chao: At the end of 2019, we set up an internal project to look at entertainment technology, and we did not use the term Metaverse. Previously, we did not invest much in the field of entertainment technology, but in the two years since then, we have deployed more than ten companies in this sector.

Q: If you don’t vote, you’re done, and the shot will be very fast.

Luo Chao: On the one hand, when judging whether early-stage projects are valuable, a very important vision is to make digital life better. Digital life is constantly increasing its penetration rate, especially after the epidemic, the migration of physical life to digital life is more and more obvious.

At the same time, it also brings some concerns, how can we make digital life better? The essence of entertainment technology is to make people’s online life, including social, game, work and other experiences, richer and better, even beyond offline experience.

On the other hand, we have seen a general trend driven by technology, and front-end and back-end technologies are constantly maturing. Front-end technologies, such as physical simulation, graphics rendering, multi-model interaction, etc.; back-end, such as cloud architecture, server engines, and high-performance databases, will generate value in a wider range of fields.

Fortunately, after our investment committee reached a consensus in this field, companies such as social platform Roblox and game engine Unity Software went public. The concept of Metaverse began to enter everyone’s field of vision and attracted a wider capital circle. Some of the companies are also growing rapidly and making significant progress.

Q: Some companies in the entertainment technology industry focus on technology, and some do content. How do you divide them by field?

Luo Chao: If we use a tree as an analogy, the bottom layer of our investment is the code layer, the core is the underlying technology engine, cloud and server technology architecture; the middle layer is the operating system, editor, tools, similar to BUD they do. Part of the things, that is, the bottom part of the tool; further up is the application layer, including some games and social applications. In particular, the bottom two layers, the operating system and the application layer, are the ones we invest the most.

Q: Do you prefer the bottom layer and technology?

Luo Chao: The entire entertainment technology is still in the early stage, and we still need to wait for some key inflection points.

In 2021, the global sales of consumer VR headsets are expected to be about 12.5 million units. I think 50 million or even hundreds of millions of active devices will be a real change, and the platform will generate more new applications.

Therefore, today we are more cautious in the application layer, and the fluctuations are relatively large, while the technical layer can see the real accumulation and can make bold moves. Of course, this does not mean that the application layer has no value, but to choose the right time to enter. Once the technical software and macro equipment as a whole reach a state of 80 points, a hundred flowers will bloom.

The technological innovation of the Metaverse still needs to wait for key nodes

Entrepreneurial teams are most afraid of collapse

Q: The Metaverse is on fire, and many projects have begun to use the concept of the Metaverse. Are there more options for investment?

Luo Chao: We still keep talking with the entrepreneurial team. It’s not enough to just look at the BP (business plan). The screening rate of this track is 1%-2%. It’s not bad if 100 families can vote for one or two. My investment philosophy is, first, a sense of mission to empathize with entrepreneurs, and second, diligence, that is, to run more, see more, and talk more.

Q: What qualities do you value more in the entrepreneurial team?

Luo Chao: The first thing we value is the technical path, which is more important than anything else, that is, the technical value and product accumulation of the startup company. Because the Metaverse is a long-term thing, to achieve the ideal state of extreme experience, seamless connection, rich layers, and no delay barriers, I personally think it will take at least 20 years, or even longer.

The second is the team, which includes the original intention and complementarity. The original intention is to be in the field of entertainment technology, and it has been done for a long time, and the complementarity of the team is the chemical reaction of the team members. I don’t particularly believe that a 100-point technical master with a group of 50-point people is not as good as a few 80-point and 90-point people working together. The latter’s entrepreneurial success rate is much higher.

When I meet the team and do executive interviews, I pay special attention to these points. Everyone chats individually to see if their ideas are on the same page. Entrepreneurial teams are most afraid of collapse, jumping left and right in unrelated fields. This is one type of collapse; the other type of collapse is conflicts between teams.

Q: When it comes to BUD, how do you judge the team?

Luo Chao: BUD essentially lowers the threshold for creation, allowing more users to join to build richer content, making people’s virtual life better. To a certain extent, the creator platform BUD is benchmarked against Roblox, but the quality is higher and the crowd positioning is different. The underlying engine, Cocos, targets Unity Software.

Talking to the BUD team, I remember asking them a question, if there is only $300,000 left, what will you use it for? They replied that it is definitely not used to acquire customers, but to continue to do infrastructure and optimize products. This is in line with my values.

The founding team of BUD is very good. The two founders, Risa and Xiao, have rich overseas experience. They used to work at Snap. They understand both technology and social interaction, and they are doing global things. The advantages are obvious.

Q: You said earlier that you would be attracted by the enthusiasm of the entrepreneurial team and the ability to combine technology and aesthetics. Aesthetics is very abstract. How do you understand it?

Luo Chao: Take investing in BUD as an example. I was hesitant at first. The tangled point is, is it a little too early to vote? Can the team do it? I tend to vote, but not 100% sure.

Until one night, when I opened the BUD, the product was still rough, and my three-year-old daughter was beside me. She came over to see me pinching a virtual person in the BUD, driving bumper cars to collide, and she said, this little girl is really cute.

I opened another product and asked her, is this cute? She said she didn’t like it. She opened another one, and she still didn’t like it. At that moment, I made a decision.

It sounds like this investment decision was based on my daughter’s love of the product, but it was the “last straw” that made my decision. Looking back, BUD mainly focuses on the female market, whether in Asia or Europe and the United States, they need a variety of high-end aesthetics.

Assuming the product and technology accumulation are at the same level, then aesthetics wins out in the end. In fact, you ask me to be a straight man, but I can’t see it. A three-year-old girl can see it more intuitively. This may be the inexplicable part of aesthetics.

The technological innovation of the Metaverse still needs to wait for key nodes

Giants are the biggest variable

Q: On the entertainment technology track like the Metaverse, big companies such as Byte and Tencent have all come to an end. Whether they are investing or leading projects, do they form a competitive relationship with startups and investment institutions?

Luo Chao: In the field of many sub-tracks of entertainment technology, some big manufacturers have already started to set up projects internally. Giants are the biggest variable faced by startups. Since it is certain that the giants will end, they will face the competition.

Q: As for the subdivision of virtual humans, there are virtual idol Luo Tianyi and various virtual humans that have emerged later. Is there still a lot of room?

Luo Chao: In the long run, virtual humans are valuable, and their commercial value has been proven.The core of this is not whether the painting style is two-dimensional or hyper-realistic, etc., but how much wisdom needs to be added to the virtual human, that is, the AI ​​power behind the virtual human.

The virtual human is still on the eve of a quantitative change to a qualitative change. We have successively invested in subdivided tracks such as virtual human interaction, virtual human driving engine, and virtual fitness and social networking, all of which are closely related to virtual humans.

Q: If you vote for a virtual person, what are your standards?

Luo Chao: Virtual human is an indispensable part of the future virtual social space, and there is a lot of room for imagination. The standard I judge today is also very simple, that is, technology.

Today, many virtual human beings are still made by general-purpose game engines. The difficulty lies in the artificial labor in the later stage. There is a lot of human labor behind an excellent virtual human. It is necessary to optimize the facial expressions, even the light, and modify it frame by frame.

We have seen some virtual human teams that lead because of more manpower input, not technical differences. So, we’ll just wait a little longer and hope to see something technologically driven that makes enough of a difference in quality.

Q: The virtual human is the first thing users feel, including collaborative development platforms such as TeamCode, is also an indispensable part of the Metaverse?

Luo Chao: Compared with “Metaverse”, I agree more with the translation of “Full True Internet”, which was proposed by President Ma Huateng. The reason is that he saw through it that it is not a universe, but an Internet in essence, which is more immersive and real than today’s two-dimensional Internet.

According to the solution of the true Internet, everything is code, and no matter what you do, the underlying “bricks” of the infrastructure are code.

This involves remote collaborative development and zero-deployment testing of a large number of microservices. These are all things TeamCode is doing. There is another startup company, Merico , an open source community that serves developers. The quality of the “bricks” in the Quanzhen Internet, and whether the “bricks” are good or not, depends on AI tools to review the code, just like cover It is the same for the house to be supervised.

This is also how we look at the true Internet, targeting the bottom and middle layers first.

Q: From an investment perspective, has the Metaverse bubbled?

Luo Chao: Any hot concept will face the problem of “overheating”. I’ve had some interesting BPs.For example, there is a person who has worked on O2O, blockchain, and Metaverse in the past five years. Recently, he has been working on carbon neutral projects, and he has only worked on everything for one year.

An industry will always have a shock cycle, and there will be an upward curve and a downward curve.When going down, many opportunists do other things, not because they are wrong, but because they don’t accumulate enough, and a large number of such people will be screened out.

Just like when we invested in many companies, the hot concept had not yet emerged, which was a good time. At this point in time today, and moving on to the next stage, we also need to cultivate patience, because we have expectations for this matter.

Posted by:CoinYuppie,Reprinted with attribution to:
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