Virtual-reality property startup Inspace XR has raised $750,000 in funding, with co-founder and chief Justin Liang drawing on his past in venture capital to avoid some common early-stage pitfalls.
The round was led by early-stage investment group Investible, and also included Artesian, Taronga Group and angel investment group Sydney Angels.
Inspace XR was founded almost two years ago, after Liang left AMP Ventures, the venture arm of financial services firm AMP, which shut down in January 2017.
He joined forces with co-founder Eric Fear, former VR lead at the Academy of Interactive Entertainment.
Inspace XR uses its River Fox VR technology to allow architects and builders to present building designs, meaning clients can walk through a virtual mock-up of their finished product.
It’s intended to reduce the risk of costly design errors, Liang tells StartupSmart.
As soon as he tried out a VR headset for the first time, the founder realised “a really obvious application was to be able to put someone inside a building before it exists”, he says.
“That changes the way you design, construct and sell that building.”
Already, River Fox is being used by real estate giants including JLL, CBRE, Charter Hall, Folkestone and Macquarie Bank.
The startup also has an Inspace Labs consulting arm, which delivers bespoke augmented reality and VR projects and other hardware solutions, and which is “very profitable” and growing quickly, Liang says.
According to Liang, the founders started building relationships with investors before they necessarily needed funds, in order to get early feedback on the business.
“When we needed cash, we said we were open,” he says.
Ultimately, a few different investors offered to lead the round, but the founders chose Investible because they’re “the right kind of investor to help us grow here and elsewhere as well”.
But it wasn’t a purely professional decision. The pair had also found friends in Investible co-founders Creel Price and Trevor Folsom, who are both former startup founders themselves, Liang explains.
“It’s really important for investors to be able to have that founder empathy,” he says.
The funds will be used to further develop River Fox, and then to launch additional products.
“We’re starting to dabble in the AR space,” Liang says, looking into both the building industry and engineering sector.
It’s also looking at expanding internationally. Australia only represents 2% of the global market for Inspace XR, Liang says.
Within two to three years, “we really want to have a pretty prominent global presence”, he adds.
“It’s ambitious, but our next two markets are the US and China, so if we can get those locked down we’ll be pretty happy.”
Having worked at AMP Ventures, Liang had some insight into the startup ecosystem before he started his founder journey.
This gave him a heads up on everything — from what should or shouldn’t go into a pitch deck and what investors actually care about, to which business models are challenging and which are more easily scalable.
These are “pitfalls that are really obvious to me now”, he says.
It also made him realise the importance of timing.
“There is a lot of stuff that is cool, great tech, but perhaps too early or too late,” he notes.
However, the thing that has actually had the most impact on the business has been finding the right people, Liang says.
“As cliche as it is, as a founder, it’s your job to pick the right players … to first understand the game you’re playing, and to pick the right players to win that game,” he explains.
As well as bringing staff on board, Inspace XR is building a network of advisors and strategic investors.
“All of that is really helpful for our journey,” Liang says.
