At a special event today in San Francisco, Microsoft announced
that it has acquired social VR app AltspaceVR.

The virtual reality social networking app allows users across
headset and web platforms to join 3D chat rooms to play games,
watch videos and attend events.

In July, the startup announced it was shutting down after a new funding round had
fallen through at the last minute, leaving the startup out of
runway. Just weeks later, the company announced that it was
keeping the lights on after help from a
“third party.”

We now know that third party to be Microsoft.

“Microsoft is excited to incorporate communications technology
into our mixed reality ecosystem. Today’s social experiences
can be one sided: text, photos, and videos are posted by a
single person, to be consumed by others later,” a Microsoft
spokesperson told TechCrunch in a statement. “But AltspaceVR
takes social networks, combines them with real-time
experiences, and leverages immersive presence to transcend
beyond sharing posts to sharing situations. Situations of
people, places, and things have deeper meaning and in turn, are
more memorable.”

Terms of the deal were not disclosed. AltspaceVR raised more than $15 million in
venture funding from Comcast Ventures, GV, Formation 8 and

As of July, the startup detailed that it had just 35,000
monthly active users. Following the shutdown announcement, the
startup let go a significant number of employees, leaving what
it referred to as a “skeleton crew” to keep the service

The startup joins Microsoft as the company is aiming to
distinguish its “mixed reality” platform for VR headsets
running Windows 10. The company is releasing a slew of headsets
with OEM partners this holiday at a more aggressive price point
than its competitors, with headsets starting at $299.

Many have referred to social experiences as the “killer app” of
VR, but the competition has been stiff as smaller startups go
head-to-head with Facebook for control of a market that has
just a few million users in total.