Matterport: Creating a Real Estate VR Platform
Matterport provides a platform to transform real estate into virtual reality experiences, consumable both in an internet browser and a virtual reality headset.
Although virtual reality applications are currently in the infancy stage and mostly focused currently on gaming experiences, the expectation is that virtual reality will spread quickly across a number of verticals to grow into an $80 billion market by 2025, according to Goldman Sachs. Of the many potential use cases of virtual and augmented reality, one that I find most interesting is in the real estate vertical, and a company that is successfully leading the charge to bring virtual reality experiences to the real estate market is a company called Matterport.
Matterport provides an online platform for suppliers of real estate to create virtual reality replications of real estate, and for purchasers of real estate to view and experience real estate in virtual reality. Additionally, Matterport has created a camera that can scan a piece of real estate and transform it into a virtual replica. It is an interesting approach to take because Matterport has two value capture models: it charges real estate vendors a monthly fee to use the virtual reality platform to give to their customers, and also it sells the virtual reality camera to individuals who want to make a living capturing real estate and converting it into 3D. The monthly subscription to use the VR platform ranges from $500 – $1,500 a year and the camera Matterport sells to capture spaces in VR costs $3,600.
By having these two complimentary value capture models, Matterport is able to push the development of its platform further by profiting on the growing adoption and acceptance of VR while at the same time profiting on the increased use of the Matterport platform. Another way that Matterport helps drive adoption of VR is that the Company’s platform allows for virtual real estate to be viewed on an internet browser or a VR headset. By providing these two offerings, Matterport is recognizing that VR may be the future, but it will be a slow transition to get there. Providing opportunities to see virtual real estate renderings on a web browser is an important first step in VR adoption for real estate, and allows Matterport to build a sustainable business during the transition to VR, not just when VR (potentially but likely) takes over as a dominant computing platform. Allowing customers to view real estate in virtual reality is a highly enhanced experience and reduces the need to see real estate in person before making purchasing decisions.
Matterport’s opportunity to bring VR to the real estate market is indeed a strong opportunity, as existing home sales in the U.S. reach near record highs, but it is also not without risks: real estate can be highly volatile, and thus Matterport’s business will rise and fall along with real estate sales. In order to protect itself from volatility in real estate and to further drive VR adoption in this space, Matterport should seek to increase partnerships and expand across use cases in the real estate market to reduce risk. Beyond current offerings for virtual reality mapping of residential real estate and construction sites, Matterport can expand into opportunities such as partnerships with Airbnb and hotels around the world to provide VR experiences for customers seeking to rent real estate both for full-time living as well as vacationing. Furthermore, Matterport can enter opportunities with event space rentals and sporting/concert venues to offer services that provide customers the opportunity to experience the event space or seat at a venue that they are looking to rent or purchase. I believe such opportunities would allow Matterport to continue building on its strength that allows owners of real estate to provide enhanced previewing opportunities to their potential customers, while also reducing the risk of being tied to any one particular use case that may be volatile over time.
Hey Brandon, thanks so much for the blog post! It seems like the use of virtual reality could entirely disrupt and displace real estate agents. I’m curious if/how this institutionalized industry is thinking about this competitive threat and how to respond. Also, as Matterport considers additional ways to create value, perhaps the company could offer a service that provides home sellers with recommendations about how to best stage their homes for the most flattering VR experience for potential buyers (similar to how real estate agents provide staging advice).