In less than a decade we’ve moved from early versions of smart glasses like Google Glass to virtual reality gaming headsets like Oculus. This takes us ever closer to a digital reality that is often referred to as the metaverse—and as we look for investment opportunities around the metaverse, we’re focusing on it as an enabling technology.
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In less than a decade we’ve moved from early versions of smart glasses like Google Glass to virtual reality gaming headsets like Oculus. This takes us ever closer to a point where we can do everything we do in the physical world within a digital ecosystem. This digital reality world is oftentimes referred to as the metaverse.
In the future, when the metaverse reaches its end point, all of your life is going to be lived in digital form.—Drew Buckley, CFA
In the future, when the metaverse reaches its end point, all of your life is going to be lived in digital form. That’s where your kids will go to school; that’s where you’ll do your work; and all of your leisure time will be spent inside this simulation. Even senses—like touch, smell, and taste sight—can be replicated and delivered to you from the digital reality.
We’re not quite there yet; we’re in this kind of in-between state that most people would call a kind of “mixed reality,” where the virtual world and physical worlds are increasingly becoming interconnected. Pokémon GO is a good example. More complex examples in the future will be fixing machines or the human body.
But there’s no denying the trend, and each day we get closer and closer to the metaverse being a reality. Hardware and software continues to evolve and get better, and connectivity, like 5G and 6G after it, promise faster speeds and lower latency. If nothing else, just look to the younger generations and how much technology they’re adopting and how they’re using it. We definitely can say that the metaverse is coming in our opinion.
As we look for investment opportunities around the metaverse, we’re really focusing on it as an enabling technology.—William Benton, CFA
As we look for investment opportunities around the metaverse, we’re really focusing on it as an enabling technology. It’s a great tool in e-commerce. It helps reduce customer uncertainty, and thus can improve sales of products as well as reduce return rates where there is a more specific customer requirement, like with clothes or furniture. These tools should enable further penetration, ultimately, of online spending.
And you’re going to see it in areas you don’t see it in today, like education or surgery. That should ultimately expand its total addressable market. And it will ultimately then thus impact many of our existing investments as well.
It could ultimately be very disruptive to companies that don’t adopt the technology, because ultimately, if you don’t, somebody might move your cheese—or take your your customers, effectively.
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