Alibaba

Alibaba makes Metaverse bet in China

Technology

Alibaba Group Holding Ltd. spearheaded a $60 million investment in Chinese augmented reality glasses company Nreal, joining competitors Tencent Holding Ltd. and ByteDance Ltd. in a bet on the metaverse’s future.

The Series C+ investment round takes Nreal’s total raised in the last 12 months to $200 million, the Beijing firm said in a statement, without providing its latest value. CNBC stated at the time that the business was valued at $700 million in a prior round launched in September 2021, citing an anonymous source.

Alibaba’s investment follows similar efforts by other Chinese internet behemoths interested in the metaverse, a possible future version of the internet that combines parts of virtual reality, social networking, and other digital technology. According to Bloomberg, TikTok owner ByteDance purchased virtual reality gear company, Pico, last year, while Tencent is close to an agreement to acquire gaming handset firm Black Shark.

Xu Chi, a former developer of American AR firm Magic Leap Inc., established Nreal in 2017. Magic Leap launched a lawsuit against Xu in 2019, accusing him of stealing the company’s secrets, but the case was eventually abandoned after a US judge decided in Nreal’s favour.

Alibaba invested in Magic Leap in 2016, when the business was one of the most highly heralded US companies, with investors including Alphabet Inc. However, the Florida-based firm struggled to sell its consumer headgear and has subsequently shifted its focus to business services.

According to the business, Nreal presently has roughly 400 workers and has marketed its glasses through carriers such as Verizon Communications Inc in the United States. Among its backers are well-known venture capital companies and IT titans such as Kuaishou Technology, iQiyi Inc., Sequoia China, Hillhouse, and Jack Ma’s Yunfeng Capital.