Metaverse Academy: Working

Key points: 

• The ”Working” sub-theme of the Metaverse showcases an exciting evolution of the global marketplace
• More industries can access increasingly sophisticated collaboration, efficiencies, and scale
• Opportunities for both business-to-business (B2B) and business-to-customer (B2C) end users

We have already visited the Metaverse themes which highlight increasingly sophisticated and immersive capabilities in the entertainment and communication space. Now it’s time to get down to business and delve into pioneering virtual capabilities creating exciting opportunities for the future of industry and the workplace, against a backdrop of unprecedented potential scale less inhibited by the limitations of physical space, supply, and logistics.

WFH - Working from Hyperspace?

The promise of the Metaverse as a tangible investment opportunity is closely linked to the growing convergence of the virtual and physical worlds, and the working sub-theme is no different. Just as we saw with the gaming and socializing sub-themes, the concept of remote working has gained significant traction in recent years. Hybrid remote working via Citrix or virtual private networks (VPNs) was already increasing in popularity pre-2020 due to the rise of affordable high-speed broadband and WiFi, rising levels of sustainability awareness and initiatives to lower carbon usage for travel, and the increasing move away from traditional, static office environments to hot desking.¹ Remote working uptake by individuals and investment from corporations was ultimately forced to accelerate overnight during the COVID-19 pandemic and lengthy lockdown periods. Telecommunication companies such as Zoom Video Communications were well placed to take advantage of this rapid user base expansion, and in a post-pandemic environment, the company continues to invest in Metaverse initiatives to not only replicate face-to-face meetings and workplace environments but to improve upon them. The company developed a new app, Welo, which aims to create a ”mini-Metaverse” for dedicated virtual reality (VR) meeting environments.²

Make it with the Metaverse

Of course, not all industries are suited to home-based working and some need to be more imaginative when seeking to harness the power of the Metaverse. This is where opportunities with tremendous potential are emerging in industrial engineering, manufacturing, and design companies within a B2B context, aiming to increase efficiency and drive the future of augmented, collaborative working. Similarly, opportunities within the working sub-theme include those connecting with end users to provide a service or benefit, such as healthcare (discussed below). Both types can use the scale and the lack of physical constraints afforded by the Metaverse to work with and provide services to a global customer base.

Autodesk is a major developer and provider of computer-aided design (CAD) and engineering software for architecture, manufacturing, engineering, and construction industries. The company is investing in Metaverse capabilities to create a ”digital twin,” or an identical digital copy of a complex physical object. The company has recently partnered with Epic Games (the developer behind popular gaming titles such as Fortnite) to further develop its capabilities for activities such as architecture, city planning, and machinery design to enable real-time collaboration from disparate locations. Autodesk’s CEO has stated a clear intention to utilize best-in-class Metaverse capabilities from other developers and build vertical value on top of them to drive the evolution of what he coins as an “industrial Metaverse.”³ More and more companies share this sentiment, such as Cadence Design Systems, which provides software solutions for the design and simulation of integrated circuits and chip design. Its investments in machine learning and artificial intelligence (AI) have afforded the company a strong set of capabilities such as Tensilica, a digital signal processor (DSP) – or specialized microprocessor chip – designer which facilitates improved, real-time AI design for complex products. It also developed Cerberus, a machine learning system that addresses the issue of increasingly complex chip design with the aid of advanced AI capabilities and automation. As with Autodesk, the company has recognized the potential of digital twins modeling and has brought out its own Computational Fluid Dynamics system that can be used in this manner with applications such as aerodynamics, fluid flows, or acoustics.

A Good Prognosis for Growth

One of the most exciting developments with the rise of virtual capabilities is the future of healthcare and how therapies and resources can be deployed safely and efficiently around the globe with low latency. The healthcare sector has long been a prime source of innovation and research but has been constrained by the physical limitations of logistics, supply, and capacity. The evolution of the Metaverse has prompted a rise in virtual healthcare opportunities, whereby certain medical needs can be addressed via immersive VR connections. This may sound incredible, but it is simply a logical continuation of the accelerating shift to virtual healthcare such as video General Practitioner appointments. The digital healthcare company Livi is well known for its partnership with the UK National Health Service and has already provided virtual appointments to over three million patients.⁴ The Metaverse healthcare market takes this to the next level, providing treatments within the virtual space and the size of the potential market is expected to grow to $5.4bn between 2024-2030, driven primarily by the US market.⁵ Penumbra is a US-based company that produces medical devices. In 2017, it partnered with Sixense Enterprises, which specializes in VR hardware and software to create the REAL system.⁶ This pioneering collaboration saw the expertise of technical developers and clinicians combine to deliver a virtual rehabilitation tool for patients with specific therapeutic needs, as well as a wide range of conditions addressing a market of over fifty million patients in the US alone.⁷ In a 2022 press release, Penumbra claimed it had “…upgraded hardware and sensor technology to address needs spanning a wider range of rehab patients. The expanded content library includes activities that address motor skills, cognition, core and balance, functional tasks, activities of daily living (ADLs), vision, and wellness.” Dassault Systemes is another example of a 3D software design and simulation provider which utilizes visualization and digital twins. An example of its significance for the future of healthcare can be seen in its Living Heart Project, in partnership with the United States Food and Drug Administration (FDA), aimed at enabling physicians and surgeons to use advanced simulation technology for the ultimate aim of improving patient care and safety by testing the outcome of medical procedures before they are carried out physically.⁸ This safe and innovative approach to surgical education is growing apace globally. In August 2022, the UK NHS Guy’s and St Thomas’ Trust began training junior surgeons in virtual lectures and operating theaters. In the words of consultant specialist surgeon Adil Ajuied, “Virtual reality is not just for gamers entering an electronic world. This type of surgical training is very much like an aviation simulator – pilots learn how to fly airplanes on the ground before they ever get onto an airplane with passengers. The benefit for our patients is that they will be cared for and treated by surgeons who have had the opportunity to rehearse, practice and run through their surgical procedures.”⁹

Of course, it’s not just physical medicine that can benefit from the capabilities of the Metaverse. Demand for mental health professionals has long outstripped supply and is headed toward a crisis. Almost seven in 10 psychologists (68%) with a waitlist reported that it had grown since the start of the pandemic.¹⁰  Research and development into utilizing the scale and accessibility of the Metaverse are being carried out by esteemed institutions, such as the University of Oxford, to address the needs and improve the lives of patients requiring mental health assistance. Numerous projects are underway designed to promote immersive VR activities to benefit the health of patients suffering from anxiety, worry, confidence, sleep disorders, psychosis, and many other afflictions.

See the Whole Picture

The opportunities for this so-called “industrial Metaverse” are as diverse as they are abundant. while there are clear trends across such industries as telecommunications, design, manufacturing, and healthcare, there are also established design companies such as Adobe. Its advances in 3D object creation and augmented or virtual reality are helping to improve the immersive experience for the end consumer in a variety of markets. Overall, this level of interconnectivity and sophistication requires a strong infrastructure and other enablers to protect the present and drive the future of the Metaverse – our final Metaverse Academy sub-theme edition will focus on these sometimes overlooked – but crucial – Metaverse heroes.

Companies shown are for illustrative purposes only as of 19/10/2022. It does not constitute investment research or financial analysis relating to transactions in financial instruments, nor does it constitute an offer to buy or sell any investments, products or services, and should not be considered as solicitation or investment, legal or tax advice, a recommendation for an investment strategy or a personalized recommendation to buy or sell securities. There is no guarantee that the strategy will be successful in pursuing any individual investment mentioned.  

Risks

No assurance can be given that our equity strategies will be successful. Investors can lose some or all of their capital invested. Our strategies are subject to risks including, but not limited to: equity; emerging markets; global investments; investments in small and micro capitalization universe; investments in specific sectors or asset classes specific risks, liquidity risk, credit risk, counterparty risk, legal risk, valuation risk, operational risk and risks related to the underlying assets.