Benjamin O'Brien, CEO of StretchSense, on his motion capture gloves and how his company is changing the industry of motion graphics and the way we interact with technology. Video / NZ Herald
“We are working toward being the future of the human-machine interface for virtual worlds - giving people a natural, human presence inside virtual worlds,” says StretchSense co-founder and chief executive Ben O’Brien.
The Auckland-based maker of motion-capture gloves, has raised $13 million to continue its comeback, and expand intothe metaverse.
The round was led by Edinburgh-based venture capital firm Par Equity, supported by Kiwi VC outfit Global From Day 1 (an existing investor) and Scottish Enterprise, Scotland’s national economic development agency.
StretchSense hit headlines in 2019 after a $29.6 million deal with Japanese retailer Start Today fell apart and most of its 180 staff were laid off. Auckland University’s commercialisation arm, Uniservices, the Government-backed NZ VIF (now NZGCP) and other investors were left out of pocket.
Neither was it a great look for Callaghan Innovation, which had been awarded up to $15m in matching R&D funds - although with StretchSense now hiring again, and developing fresh lines of business, the Crown agency could still potentially bank it as a win.
StretchSense and Start Today had been collaborating on the futuristic “ZoZo” - a bodysuit packed with sensors, the better to get perfect body measurements for online clothes shopping. The initial development effort was hit by glitches.
An obvious take was that the Zozo Suit, which was pushing the boundaries of wearables and online shopping, was always going to be high risk.
O’Brien says probably the biggest lesson was to be in control of your own product, and not be dependent on decisions made by a partner.
With its reboot, StretchSense has gone in the opposite direction, shooting for a niche in an already-established market and aiming to make it better - and keeping full control of its hardware and software.
But in 2020, the firm began what could be termed a Hollywood comeback. Backed by GD1, the reborn StretchSense bought a two-person Seattle company called MoCapNow, maker of the MoCap Glove - a close relative to StretchSense’s original product before it over-reached with the ZoZo.
Benjamin O'Brien, CEO of StretchSense, a wearable technology group. Photo / Dean Purcell
Motion-capture technology was already well-established with movie studios and computer game makers - but O’Brien had noted that hands were a weak point. After painstaking, expensive efforts to capture facial expressions and body movements through actors wearing sensor-suits, hands could be “like paddles” - necessitating costly animation after-the-fact.
StretchSense has addressed this market with new MoCap gloves (priced from US$4990 ($8432) to US$8900 ($15,000) per pair), coupled with Hand Engine software licensed at US$1490 ($2500) per pair of gloves per year.
The firm won’t reveal any financials, but business has been good enough to build back up to 60 staff (mostly in NZ) and sufficiently impressive pull in the $13m in new funding from GD1 and the Scots at a time when venture capital is suddenly scarce. And while he won’t give a post-money valuation, O’Brien said the Scots took a minority stake (GD1 is the largest shareholder, with 31 per cent of shares, plus 21 per cent through GD1 Nominees (a vehicle for smaller co-investors).. O’Brien has a 5 per cent holding. Scottish Enterprise has a 6 per cent stake and Par 4 per cent).
O’Brien says Auckland will remain his firm’s centre of operations, but that it will also hire in Edinburgh - in part because NZ is the wrong end of the global tech talent squeeze, but also because StretchSense has a number of customers in Europe. It will help for round-the-clock support, too.
Par Equity analyst Claire Cramm (left), Stretchsense co-founders Professor Iain Anderson and Dr Ben O’Brien, Par equity partner Paul Atkinson and Par Equity senior investment manager Tom Croy.
The Scottish connection came via GD1, whose partners Chintaka Ranatunga (Asia), Vignesh Kumar (the US) and John Kells (the UK) developed expansive networks during their time working offshore before they returned to Auckland to found their VC fund.
What’s next? O’Brien sees a big metaverse play in StretchSense’s future - and that’s what much of the $13m in fresh capital is earmarked for.
Meta founder Mark Zuckerberg has struggled to gain traction with his version of a 3D virtual community, accessed via virtual reality goggles and hand-held hand controllers. Users, and investors are unconvinced, to put it mildly.
O'Brien wearing motion-capture gloves. Photo / Dean Purcell
But for O’Brien, that’s the whole point. The Metaverse needs “an iPhone moment”, the StretchSense founder says - a breakthrough in user-friendliness that mirrors the way Apple’s handset, and its App Store, revolutionised the smartphone market. His company hopes to oblige.
“We believe that technology-enabled garments are needed to humanise access to virtual worlds,” O’Brien says.
“We have already proven this model by revolutionising how studios capture highly precise, detailed hand movements in the gaming and VFX [movie visual effects] industries. With this investment we are expanding into the metaverse, focused on the key partnerships, new technology, and investments in scale needed to build the future of how people will create, learn, work, and play.”
