Movie studios are glancing behind their backs to see if virtual reality gains enough traction to impact their business. More daring ones are putting money there first.
Take Vrse, a startup that has established a name for itself as a VR film producer. Today it’s raking in $12.56 million in funding from a collection of tech and media venture capital sources, such as Vice Media, as well as major film studios like Legendary Pictures and 21st Century Fox.
And it’s changing its name: The Los Angeles-based production and software company is now Within, a name that "represents storytelling as human experience," writes CEO Chris Milk, a filmmaker familiar to the TED conference and Sundance circuits.
The name change is also an attempt to shake the trappings of the term "VR." Despite the influx of attention from tech giants, the young virtual reality field is still mostly tied to gaming and, to a lesser extent, to live video, which Google and Facebook are pushing.
The term is also tied, in many corners, to bubbles. While exuberant startup funding has dried up, VR companies have no problem raising cash. Yet there is plenty of skepticism about the field's potential to become mainstream.
"There’s a lot of hype recently," Aaron Koblin, Milk’s co-founder and CTO, told Recode. "For us, it’s less about the term ‘virtual reality.’ We still call film film even though it has nothing to do with film."
As creators of some widely distributed VR short films — like those for the New York Times Magazine and the United Nations — Within (née Vrse) would like to see VR cinema take off. "We’re trying to create a visceral incarnation of dreams and things that actually couldn’t be in existence," Koblin said. "Calling it virtual reality is aiming too low."
The startup is also in the content game: It’s announcing the release of an app, which showcases its work, on the pricey VR hardware from Facebook’s Oculus and HTC.
That operational model — production studio plus distributed content — puts Within in competition with several other players, including the well-funded Jaunt.
(Technically, Within provides the tech tools for these films; Vrse.works, a sister company that Milk also runs, is the production company.)
That doesn’t faze Andreessen Horowitz, which led the startup’s seed funding and this Series A. "This is the first great team we saw that could keep up with anyone technologically and really tells stories," said Lars Dalgaard, the partner leading the round.
Koblin said that its new funding will go to improving its products and expanding its staff, now at 19. Its business model is pre-revenue, as they say in the Valley (which means they aren't making any money yet).
Are its investors worried about that? "No, we’re not," said Dalgaard. "It’s very early days."
Here's an example of the company's work:
This article originally appeared on Recode.net.