October 14, 2021  |  Global Equity
Enabling Technologies in Digital Reality

Global Research Analyst

Drew Buckley, CFA, partner, is a global equity research analyst. He covers small-cap technology, media, and communication services companies. Before joining William Blair in 2008 as a global research associate focused on technology, media, and telecommunications stocks, he spent two years as a senior associate in Ernst & Young LLP’s investment management assurance practice. Drew is a member of the CFA Society Chicago. He received a B.S. in business from the University of Colorado–Boulder.

Global Research Analyst

William Benton, CFA, CPA, partner, is a global equity research analyst. He covers small-cap consumer companies. Previously, he covered mid- and large-cap technology, media, and communication services companies. Before joining William Blair Investment Management in 2007, William was a technology research analyst with the firm’s sell-side research group for 10 years. In this position, he was twice named “Best on the Street” in The Wall Street Journal’s annual analyst survey. Before joining William Blair in 1997, he worked at SBC Warburg, U.S. Cellular, May Company, and Monsanto. He is a member of the CFA Society Chicago and holds the CMA designation. William received a B.S. in finance from the University of Illinois Urbana-Champaign and an M.B.A. from Dartmouth College’s Amos Tuck School of Business Administration, where he was a Tuck Scholar.

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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 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.

Watch the video or read the recap below.

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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Global Research Analyst

Drew Buckley, CFA, partner, is a global equity research analyst. He covers small-cap technology, media, and communication services companies. Before joining William Blair in 2008 as a global research associate focused on technology, media, and telecommunications stocks, he spent two years as a senior associate in Ernst & Young LLP’s investment management assurance practice. Drew is a member of the CFA Society Chicago. He received a B.S. in business from the University of Colorado–Boulder.

Global Research Analyst

William Benton, CFA, CPA, partner, is a global equity research analyst. He covers small-cap consumer companies. Previously, he covered mid- and large-cap technology, media, and communication services companies. Before joining William Blair Investment Management in 2007, William was a technology research analyst with the firm’s sell-side research group for 10 years. In this position, he was twice named “Best on the Street” in The Wall Street Journal’s annual analyst survey. Before joining William Blair in 1997, he worked at SBC Warburg, U.S. Cellular, May Company, and Monsanto. He is a member of the CFA Society Chicago and holds the CMA designation. William received a B.S. in finance from the University of Illinois Urbana-Champaign and an M.B.A. from Dartmouth College’s Amos Tuck School of Business Administration, where he was a Tuck Scholar.

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