"AR Glasses Maker Secures Huge Funding, Reviving Industry Momentum"

On September 25, 2024, consumer-grade AR glasses manufacturer Thunderbird Innovation completed its Series B+ and B++ financing rounds, with joint investments from Jiaxing Nanhu Keying, Jiaxing Nanhu Jiaxin Chuanghe, Wuxi Hui Kai Zhenghe, and Wuxi Huishan Kechuang, among other institutions. Notably, Thunderbird Innovation has raised over 500 million yuan in total financing within the past six months. It's not just Thunderbird Innovation; consumer-grade AR glasses, as a portable wearable device, offer a more natural and intuitive interaction method and are considered the best carrier for AI implementation. This year, domestic AR glasses manufacturers have been active in the capital market.

Several industry insiders, in interviews with journalists, stated that although there are not many investment and financing cases in the current consumer electronics market, the AR glasses track has attracted much attention mainly because AR technology, as a cutting-edge technology, has a broad market prospect and application potential. With the increasing demand for smart wearable devices among consumers, AR glasses, as a new generation of smart wearables, can provide a richer interactive experience and a wider range of application scenarios, such as entertainment, education, and healthcare. In addition, AR glasses also have the potential to integrate and develop with cutting-edge technologies like AI and 5G, and are expected to become an important growth point in the consumer electronics market in the future.

Heavy Investment in the Market

The latest research report from Bank of China International points out that the mass production challenges and insufficient user demand issues for AR glasses are gradually being resolved. It is predicted that the market size of AR glasses will reach the level of 1 billion units in the future and grow into the next generation of computing terminals. The report compares Meta's first-generation AR glasses, expected to be launched in 2025, to the iPhone 1 of the smartphone era. By 2027, Apple's first AR glasses may, like the iPhone 4 of its time, push the entire industry into a new stage of rapid development.

In addition to the entry of giants such as Meta and Apple, in the first half of 2024, the AR industry has seen a wave of new product launches. Many leading AR companies, such as Thunderbird Innovation, XREAL, INMO, and Rokid, have all launched their latest products.

The heat of the consumer-grade AR glasses track has also boosted confidence in the capital market. According to data from IT Orange, as of September 10, 2024, there have been 21 investment and financing events in the domestic AR/VR industry in the primary market. Despite a year-on-year decrease in investment events, the total estimated investment amount is 2.3 billion yuan, showing a year-on-year increase.

Moreover, the reporter noticed that in this round of financing, institutions with government backgrounds are the main participants. Gree Group invested in Mojie Technology, Hefei High Investment funded Shoujing Technology, and the Hefei Municipal Government also made a capital investment in Rokid. Thunderbird Innovation's total financing amount in the past six months has exceeded 500 million yuan.

The B+ and B++ financing rounds of Thunderbird Innovation were also jointly invested by institutions such as Jiaxing Nanhu Keying, Jiaxing Nanhu Jiaxin Chuanghe, Wuxi Hui Kai Zhenghe, and Wuxi Huishan Kechuang.

Yang Yang, Deputy Director of the Economic Development Bureau of Jiaxing Science and Technology City (Jiaxing Nanhu High-tech Zone), said: "The Zhejiang Provincial Committee has clearly defined the struggle goals of 'three again' and 'five more' around the implementation of the spirit of the third plenary session of the 20th Central Committee of the Party, one of which is 'more advanced'. As the leading enterprise on the AR industry chain, Thunderbird Innovation carries the mission of promoting the development of AR technology. As the number one consumer-grade AR brand in the country, it will usher in a new era of smart glasses entering the mass market."

Zhou Yi, General Manager of Wuxi Hui Kai Zhenghe Capital, said: "With the infinite possibilities derived from the combination of AI and AR, the prospects for consumer-grade AR glasses are becoming increasingly clear. Thunderbird Innovation exclusively owns the core optical solution full link self-research and mass production capability in the industry, and actively promotes the deep integration of AI and AR; with leading technical strength and forward-looking strategic layout, Thunderbird Innovation has quickly occupied the domestic market in just three years since its establishment, showing great growth potential."In response to this, Wang Peng, a researcher at the Beijing Academy of Social Sciences, stated that in this round of financing, investment institutions with government backgrounds hold a significant proportion. This is primarily due to the government's emphasis on and support for emerging technology industries such as AR/VR. This move indicates the government's recognition of the strategic position and development potential of this field, hoping to promote the rapid development of the AR/VR industry through policy support and capital investment, thereby facilitating the economic transformation and upgrading. At the same time, investment institutions with government backgrounds often have stronger financial strength and longer investment cycles, which can provide more stable financial support for AR/VR companies, aiding in their long-term development.

Zhan Junhao, founder of Fujian Huace Brand Positioning Consulting, pointed out that the government hopes to accelerate technological innovation and industrial upgrading through capital guidance. This move not only injects stable and long-term funding into the industry but also strengthens the market's confidence in the future development of AR/VR, helping to attract more social capital to jointly promote industry prosperity.

AI+AR Becomes the Main Trend

It is reported that the funds raised in the B+ and B++ rounds of financing for Lei Niu Innovation will mainly be used for AI+AR technology research and development and the expansion of the AR research and manufacturing base. Li Hongwei, founder and CEO of Lei Niu Innovation, stated: "With the continuous breakthroughs in key technologies, the accelerated advancement of AI large models, and further reduction in supply chain costs, the AR glasses industry is approaching a critical juncture before market explosion. This round of financing will help us upgrade in technology research and development and production capabilities, and will also promote our further expansion of global market influence."

In fact, since the outbreak of generative artificial intelligence technology, the integration of artificial intelligence with various industries is being fully rolled out, and "AI+hardware" is a direct manifestation of artificial intelligence at the application end. The integration of AI and AR technology is widely regarded as the next potential hot spot in the consumer electronics market. As a portable wearable device, AR glasses are considered an ideal carrier for the implementation of AI technology. AI+AR is becoming the main trend for consumer-grade AR glasses.

Guo Tao, an angel investor and artificial intelligence expert, believes that first, AR technology overlays virtual information onto the real world in real-time, allowing users to interact with virtual objects in the real environment, which is more in line with human natural habits. Secondly, with the continuous development of artificial intelligence technology, AR devices can achieve more intelligent functions, such as voice recognition, image recognition, etc., providing users with more convenient services. Finally, as a new type of intelligent terminal, AR devices can connect and work in coordination with other intelligent devices, forming a complete intelligent ecosystem.

This trend can also be seen in the new products launched by consumer-grade AR glass manufacturers. In the first half of 2024, several leading AR companies such as Lei Niu Innovation, XREAL, INMO, and Rokid have all launched their latest products. Among them, Lei Niu Innovation's Air 2s "Lie Lie Mirror", XREAL's Air 2 Ultra and Beam Pro spatial computing terminal, INMO's Air 2 and INMO GO, as well as Rokid's AR Lite spatial computing suite, most of these products have some experience with AI functions.

Among them, Lei Niu Innovation also released the first AI+AR glasses operating system RayNeo AI OS, providing an efficient, convenient, and multimodal interactive experience for AR glasses, and supporting various AI applications and scenarios such as intelligent assistants, AI translation, and image recognition. In addition, Lei Niu Innovation also provides developers with AI Studio low-code development platform and AI Store co-creation community, further promoting the diversified development of AR applications and laying the foundation for the arrival of "killer apps" in the AR industry.

Zhan Junhao stated that with the continuous development of AI technology, finding the right landing scenarios and carriers has become key. AR glasses, with their portability and real-time interactivity, can deeply integrate with AI technology to provide users with more intelligent and convenient service experiences. Therefore, AR glasses are expected to become an important promoter of the popularization and application of AI technology, driving the progress and development of the entire technology industry.