Avataar.me, a 3D and augmented reality (AR) platform, has raised $7 million (Rs 51 crore) in its Series A round of funding from Sequoia Capital India.
Avataar’s AR technology seeks to boost on-screen buying/browsing experience.
The startup will utilize the capital towards further R&D. A part of the money will be also deployed for strategic growth acceleration for brands across digital and digitally-influenced commerce industries globally.
"To put the opportunity into perspective -- by the end of 2019, there were about 1.65 billion handsets with built-in AR capabilities in consumers’ hands. This is creating an opportunity for AR/VR that didn't exist 12 to 18 months ago," said Sravanth Aluru, a co-founder.
The startup was launched in 2016 by Aluru, Gaurav Baid, and Mayank Tiwari.
Aluru, an alumnus of IIT-Bombay, was working with Deutsche Bank. Tiwari and Baid were associated with KKR & Co Inc and Deutsche Bank, respectively.
The platform currently works with e-commerce, consumer electronics, auto original equipment makers and FMCG majors across the US and Southeast Asia besides India.
The platform claims that it has already empowered over 150 million end-user impressions for enterprise customers in the last 7 months. It also has a global AR partnership with Instagram and Facebook to collaborate on AR/VR integrations.
Avataar is looking to enter other major AR markets such as the UK, Germany, and Japan by next year.
"The spend on AR tools for creating social engagement for brands along with try-before-you-buy experiences was $1.5 billion – this is expected to grow 10x by 2023," said Shailesh Lakhani, MD at Sequoia Capital India.
Sequoia raised a record corpus of $1.35 billion for India and Southeast Asia investments in July.
It has invested in more than 130 startups in India including unicorns such as Ola, MuSigma and Zomato, though it was not an early investor in any of them and came in at the growth stage.
Investor interest in the virtual, augmented and mixed reality segment has grown in recent years, with startups across sectors concentrating on layering their services with digital offerings that add value to their end products.
For example, in August this year, Cusmat Technologies Pvt Ltd, which operates a training systems-focussed augmented and virtual reality firm, raised seed funding in a round led by startup incubator and accelerator Venture Catalysts.
In November 2019, Flipspaces Technology Labs Pvt. Ltd, a VR interior design and contracting firm, raised $1.15 million in venture debt from UC Inclusive Credit Pvt Ltd and Alex Group of Companies.
In May 2019, Dalmia International, the overseas arm of the Dalmia Group, along with a group of international investors, invested in an AR education company.