The beauty of technology is evident in how it is utilized. Our world is at a point where with each new day, we get to learn about some technology that has the potential to change the world.
Augmented and Virtual Reality—along with associated platforms and devices—is one significant example of how technology embodies the potential to bring about revolutionary changes in how we experience our surroundings.
Companies focused on the AR and VR space are increasingly leveraging novel innovations to propel the industry toward new horizons. This foreshadows a future in which end users of AR/VR technology will discover wonderous possibilities.
One prominent name among the aforementioned companies is Paracosma, an Augmented and Virtual Reality solutions provider founded in 2016 at the outset of commercial VR.
The company offers custom AR and VR Application Development as well as 3D Content Creation Services, including photo-realistic 3D models, Digital Twins and 360 video production and distribution services. The company has grown to 75 employees across its US headquarters, Japan sales and technology office, and Nepal development center.
Over the last three years, the share of Paracosma revenues derived from repeat business of existing clients has increased from 37% in 2018 to 78.5% in 2019 and fully 97% in 2020. This expansion of share of repeat business was accompanied by large overall revenue gains, with repeat client revenues increasing 95% from 2019 to 2020. Such gains are a testament to Paracosma’s clients’ trust and loyalty.
In the following interview, Ken Ehrhart, Paracsoma’s Founder and CEO gives us detailed insight about the current landscape of the AR/VR industry and how Paracosma has gained a strong foothold within the market it is associated with.
Below are the highlights of the interview:
What makes your company a preferred choice over your competitors? List the products and your expertise that you want to highlight in this article.
Because of our large team and broad capabilities, Paracosma has the resources to keep up with the fast pace of innovations in AR, VR, and 3D design. Therefore, we can offer a one-stop-shop for clients seeking AR, VR, and 3D services.
With nearly 50 artists and 25 engineers and developers, Paracosma provides deep specialized expertise to match client requirements. We also have the ability to scale our project teams as needed to meet demand, all with in-house employees.
AR projects range from AR machine maintenance applications for manufacturing companies that guide engineers through maintenance and inspection steps to consumer facing AR effects for branding and marketing.
VR projects range from laparoscopic surgery training in VR to VR board and brain training games. Modeling projects range from photorealistic 3D models for rendering to replace studio photography to full-scale industrial digital twins for the display of IoT data. Simulation and game engine projects range from creation of synthetic images for machine vision training to virtual movie production.
Being in a leadership position, what is your opinion on the impact of the current pandemic on the AR/VR products industry? And what developments can be expected in the near future?
The pandemic has had a mixed impact on AR and especially VR. Initially VR headset availability was cut because of supply chain disruptions. We saw a dramatic collapse of location-based VR, along with all other retail and entertainment. We also saw industrial training programs planning to deploy VR in company classrooms shutter with those classrooms.
At the same time as the pandemic lengthened, we saw record video game sales, the introduction of the excellent Oculus Quest 2 VR headset, and the success of dozens of hit VR games and applications.
We have also seen a complete worldwide shift to virtual business conferences and tradeshows and virtual entertainment, music, and film festival events, many adopting immersive VR capabilities. We have also seen a sustained rise of VR collaboration, virtual meeting, virtual campus, and virtual training lab solutions.
With long-term adoption of work-from-home and a corresponding outmigration from urban centers to remote living and working locations, the opportunities for VR to play a permanent and central role for business communications is becoming more apparent.
With the Quest 2 headset and VR business software an order of magnitude cheaper than the costs of attending an in-person business tradeshow, there is potential for mass adoption of VR with distribution of headsets to every remote worker.
What is your opinion on the necessity for AR/VR companies to align their offerings with latest technological developments, especially when it comes to catering to the ever-evolving consumer needs and preferences?
The most pressing need in the AR/VR sector is continued improvements in ease of use. Creating, deploying, and accessing AR/VR content is still prohibitively difficult. As an example, 360-degree cameras, photos and videos are hugely beneficial for travel, news, family, social and other use cases.
But, despite rapid improvement in the quality of cameras and the drop in prices, it is terribly difficult to share and view 360 content. In contrast, we constantly click, text, share, edit and post smartphone photos with the click of a button.
Innovation in ease of use needs to catch up to technical innovation. Yet there is reason for optimism. A good measure of the success of the Quest 2 is its ease of use.
As an established busines leader, what would be your advice to the budding entrepreneurs aspiring to venture into the AR/VR industry?
Plan for the long term. Numerous AR/VR companies have failed because they misjudged the timing and size of market segments. They over-spent resources in an unsustainable way. Many of those that have survived have been flexible in pivoting to new market segments.
But the most successful have been building for the distant future, betting on future innovations, while shepherding current resources to sustain ongoing long-term growth.
How do you envision on sustaining your company’s competency in this ever-cutthroat business ecosystem? Where do you see your company in the next five years?
Paracosma’s revenues and employees have been growing faster than the broader AR/VR market, in large part due to ongoing and increasing demand from existing clients. Through delivery of innovation and quality of execution, we have maintained a very happy and loyal customer base. We believe we can continue to grow as fast as we can recruit, onboard, equip, and train new employees.
About the Leader
As a venture capitalist since 2000, who has invested in more than two dozen companies, cofounded ten, and established just as many international distribution partnerships, Ken Ehrhart has been pitched thousands of times and witnessed hundreds of technology and business transformations that created enormous new opportunities.
Ken founded and served as CEO of Paracosma, because he believed the transformation, that we are experiencing in moving from 2D to 3D computing goes beyond any other prior transformation and creates even more opportunities.
“Augmented and Virtual Reality are enabled by this widescale transformation to 3D computing, but this move to 3D is independent of AR and VR adoption. It can be seen in the development of 3D printing, self-driving cars, even deep-fake videos,” Ken expresses.
“Our largest client is replacing studio photography costs through the generation of photo-realistic rendered images of artist-created 3D models. As we push the limits to make virtual worlds that are indistinguishable from real ones, these models become too complex for use with current AR or VR. We are also using these fully realistic virtual scenes for machine vision training of AI systems and virtual movie production,” he adds.
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