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Emergence Monthly: The HoloLens has arrived

Emergence
03/01/19

What we're seeing in the market

Earlier this week, Microsoft revealed the HoloLens 2, a mixed-reality visor designed to overlay a virtual reality on top of the real world.

Amid tough competition from Oculus and the Google Glass, Microsoft has aggressively positioned the HoloLens for one target demographic: the Deskless Workforce, the millions of workers around the world who don't sit at a desk all day.

The HoloLens 2 was announced earlier this week.
The HoloLens 2 was announced earlier this week.

The product – a lighter, improved version of the HoloLens 1 – isn't far from what anybody expected, coming with an increased field of view (where images can appear) and better resolution (from 720p to 2K).

The target customer: businesses. With a hefty $3,000 price tag and a suite of enterprise-focused demos, Microsoft is clearly hoping businesses use their new device to teach and guide blue-collar workers with interactive AR tutorials and efficient AR communication.

2.7 billion workers around the world don't sit at a desk. Despite taking up 80% of the global workforce, the Deskless Workforce only garners a significant minority of software spending every year.

Spending for these workers is rising. We surveyed 100 IT buyers: 82% of Deskless Workforce employers planned on increasing software spending in the next year, focused on tools helping employees be more productive and happier at work.

Our biggest question: will enterprises give AR a shot? The success of every AR software startup focused on selling to businesses relies on the adoption of AR hardware like the HoloLens, Google Glass, or even the Magic Leap One.

Right now, this cohort of AR software startups have been forced to focus on one thing: minimizing cash burn as they wait for the killer hardware to support their vision. Any startup's attempt to sell AR-enabled learning or productivity tools will fail if there is no light, comfortable, and high-fidelity headset to support it.

Based on the initial reviews, things are looking up for AR. With Microsoft's powerful sales engine behind it, the HoloLens 2 could drive the adoption of AR and the accompanying softwares to millions of workers across the country and world.

VR software companies – a different cohort than those focused on AR – should be similarly excited, with Facebook's Oculus Quest coming later this year. The stand-alone VR headset is the most advanced yet, with no powerful gaming PC required. And while their marketing has been targeted to consumers, businesses haven't shied away from using Oculus hardware in the past.

The horizon is bright for these companies. With the wave of AR and VR headsets coming to market, we're excited to see AR companies come out of the woodwork and begin selling their dreams.

Other news we're watching.

Slack confidentially filed to IPO. Uber and Lyft are both racing to IPO, and some drivers might get stock. Spotify spent $340M to acquire a podcast empire (Gimlet Media & Anchor). Nuro raised $940M from Softbank to build autonomous vehicles. Figma raised a $40M Series C to put design tools in the cloud. Better Mortgage raised $70M from Amex. Fintech startup Tink raised $64M. Illumio raised a $65M Series E. ProductBoard raised a $8M round. ServiceMax acquired EmCap portfolio company Zinc. And Elon is in the news: Tesla layoffs, $35k Model 3 now available, he keeps tweeting, and SpaceX is putting astronauts in space.

What we're hearing from GTM leaders

It feels like everybody is hiring a CMO. The reasons are obvious: as startups compete for business with multi-billion dollar conglomerates, telling your brand's story clearly and effectively can differentiate your business from your competitor's.

But... not everybody is ready for a CMO. We recommend companies wait until they hit ~$5M in ARR to bring on a superstar CMO.

Top-tier CMOs are in high-demand. When CMOs get dozens of recruiter emails every day, the overwhelming majority won't risk their career and time on a company that isn't clearly destined for success.

Instead of hiring a CMO at your stage, focus on hiring an up-and-coming marketing leader that's managed a small team before and is willing to put in the hours to scaling your business beyond your initial cohort of customers. They'll want to grow with and deeply engage with your business, rather than bounce to the next big opportunity.

Tactical Advice from the Emergence Team

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Words from the team

1. Coaching Networks: Humanity's Fighting Chance

Just published: a deep-dive into our investment thesis behind AI-powered SaaS companies designed to augment humans, not automate them out of jobs. Read here.

2. The Next Wave of Unicorn Startups

The up-and-coming generation of unicorns looks nothing like the past. Jason Green sat down with the New York Times to talk about underappreciated markets and their impending unicorns. Read more.

3. The Deskless Workforce Opportunity

The constant moving of public tech stocks is always a hot topic, but we're not fazed. Kevin Spain sat down with Forbes to talk about building sustainable, scalable businesses for industries and sectors often overlooked by traditional technologists. Read more.

4. Superhuman, Figma, Guru, KeepTruckin, and 53 more

57 companies all destined to boom in 2019. Santi Subotovsky, Kevin Spain, and Jake Saper spoke with Business Insider about their favorite startup picks and predictions. Read more.

5. Satya & The Rise of Microsoft

"He interrupted and changed the course of Microsoft in a fundamental way." Gordon Ritter sat with CNBC to talk about Satya Nadella's impact on MSFT & where to go from here. Read more.

Where we're headed

Rainmaker 2019 – March 11-13, Atlanta

A three-day deep dive into Sales Engagement. Learn from Square's Ashley Grech, HBS's Mark Roberge, & more. Sign up.

Empower 2019 – May 7-9, Philadelphia

Collaborate and learn alongside other Revenue Team execs. Featuring the Miami Heat's Shane Battier, Slack's Christina Kosmowski, Square's John Ley, and Guru's Rick Nucci. Sign up.

Traction – Aug 7-8, Vancouver

Get actionable sales & growth strategies from Twilio's Jeff Lawson, Eventbrite's Julia Hartz, Trello's Michael Pryor & more. Sign up.

Zoomtopia 2019 – Oct 15-16, San Jose

Learn about the future of frictionless communications with the entire Zoom team and community. Sign up.

Find your new home

Head of Product – Crunchbase is the leading destination for millions of users to discover industry trends, investments, and news about global companies – from startups to the Fortune 1000. They're looking for a Head of Product with  Apply here.

VP of Customer Experience  – Guru helps everybody get the knowledge they need in seconds. Instead of relying on random documents and shared notes across your organization, Guru surfaces what you need exactly when you need it. They're looking for a customer experience leader with 7+ years experience. Apply here.

Finance Director – Drishti helps factory workers do their jobs better. Their AI-powered Coaching Network identifies the best processes across an entire workforce, then serves up context-sensitive advice to every worker as they do their job. They're looking for a finance director to oversee their accounting and finance teams. Apply here.

Associate – We're looking to bring on a new Associate to our Investment team, focused on driving our sourcing process and the development of new investment themes. Apply here.

Or... join the Emergence Talent Network for priority access and referrals to 700+ jobs in our portfolio. Apply here. 👈

What we're enjoying right now

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Congratulations to Clearbanc on their recent $120M fundraising 👏
Congratulations to Clearbanc on their recent $120M fundraising 👏

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