Virtual reality might have been around since 1968, but it didn't hit the mainstream until the 21st century. Virtuix is one active VR company seeking to capitalize on its growth, but is it doing so publicly?
Currently, retail investors won't find any available Virtuix stock on the public market. While the company isn't publicly traded, it does have a thing for crowdfunding and venture capital alike.
Why Virtuix isn't a public company after its "mini IPO."
In 2016, Virtuix performed something called a "mini IPO." The company raised $2.5 million during the first 24 hours of the process, but it wasn't the public offering you might be thinking of. Instead, it was more of a funding round that consisted of five institutional investors:
- 2020 Ventures
- Scentan Ventures
- Western Technology Investment
- Tekton Ventures
- Scout Ventures
So, why did Virtuix call it a public offering? According to Digital Trends, "Thanks to new regulation under Title IV of the JOBS Act, which passed through congress in June 2015, the general public can now invest in private tech startups right alongside the heavy hitters."
Virtuix started by offering 6.4 million Series A preferred shares at $2.33 a pop (for a total potential of $15 million raised). The company used the capital to help fund the Omni system, which is made up of a treadmill, harness, and shoes. It allows for an active VR experience while retaining safe stationary positioning.
The first investors in Virtuix came from Kickstarter.
Virtuix launched on Kickstarter in 2013. The company raised $1.1 million in funding on Kickstarter alone before raising another $20 million from private and institutional investors.
Virtuix is still working through crowdfunding platforms. Recently, the company used the site SeedInvest.
Investors can buy Virtuix Omni preferred stock on SeedInvest
SeedInvest is a platform where private companies can offer preferred stock to public investors. As of March 22, Virtuix is on a Series A-2 round. The company raised a total of $13.3 million in funding in this round alone, with a minimum investment of $998 per investor. The preferred equity shares are priced at $2.99 each and the round is set to expire sometime in April.
SeedInvest investments aren't based on any exchange and can't be done through a traditional brokerage. After all, the company isn't public.
Investors include billionaire and Shark Tank investor Mark Cuban, who said, "I believe in the Virtuix team and product. Now is the time to bring the popular Omni gaming experience to the home."
Will Virtuix go public via an IPO?
Hi, we are offering shares of Virtuix right now: https://t.co/4C4sccqZHN As a tech start-up, our two main exit opportunities would be going public (IPO) or getting acquired. Otherwise, we would continue to build a great company and aim to go public one day (as Peloton did).— Virtuix Omni (@VirtuixOmni) February 12, 2021
After the current Virtuix funding round, the company will be well-acquainted with selling preferred equity. However, the company hasn't offered its shares up on a public exchange through a traditional IPO, direct listing, reverse merger, or anything of the like.
It's likely that the seed funding rounds serve as a kind of pre-IPO for Virtuix, so I wouldn't be surprised for its next move to be submitting a registration statement with the SEC. Until Virtuix finds the right fit, this active VR company is holding on to a bit more exclusivity (and with that, a bit more risk for the average investor).