Go time on YDreams (YD.V): Canaccord gets behind immersive tech player

Last week I was in Toronto for the Cantech Investor Conference and had a blast at what has quickly become an important date on the North American investor conference calendar.

(And when I say ‘had a blast’, I mean it. Shots and a blood sugar crash at after-after party. Missed flight home. Lost time. Lost phone. Lost lunch. Apparently now I’m married to a Samoan housekeeper and am the new CEO of a blockchain company. Lessons learned.)

Anyone who didn’t attend because “I’ve been there before and it’s cool but kinda small” hasn’t received the memo that today’s Cantech conference is no such thing. Several thousand attendees hit the show floor with what looked like around 60 exhibitors, and a lot of business was being done.

While the majority of the event had a distinct blockchain focus, there was a corner of the floor dedicated to virtual reality/augmented reality that, at least for a short while, looked like a bummer.

The VR guys don’t really understand public markets yet, so subsidized booths get them out, but they’re not sure who they’re talking to or why.

And then I tried the new multiplayer VR experience developed by YDreams (YD.V) and everything changed.

Look, I’ve tried a ton of VR experiences and technologies and listened to all the sales pitches and the promises, and all the way back to the movie Lawnmower Man in 1992 we’ve been hearing how VR is ‘just around the corner.’

It isn’t. Not effective, widespread, highly adopted, monetizable VR. Augmented Reality (AR) is likely to be a big thing long before VR is (indeed, the Pokemon Go phenomenon of last year was a good example of the possibilities there), and Microsoft’s upcoming Hololens looks like it might shake things up a lot in that respect.

So is VR dead?

Nah. But VR has issues. One of those is, nobody wants to put on a helmet and have all their senses blocked from the world around them..

Until they do. Then they lose their fucking minds.

So the YDreams ‘Arkave’ multi-VR demo was empty for a few hours of the Cantech exhibition. They’d got there at the last minute, didn’t have a lot of marketing materials at hand, and the money guys were busy talking to GlobalBlockchainTechCo and FirstBlockCryptoMine. The VR corner was a wasteland.

So I threw on a headset with a buddy and tried the YDreams game. And I died.

VR is fun and all, but a multiplayer VR game is next level fun. Being immersed in a strange world is so much better when you have a friend in the world and you’re working together and being attacked from above by stormtrooper-style robots in a space station, and the walls in the game match the walls in reality.

Think paintball without the pain. Think lasertag in space. Think escape rooms without the boredom, and with water rising as time ticks away.

If you’ve ever really wanted the TRON experience, YDreams has done it. As soon as your helmet is on, your backpack is on, and you’ve calibrated, you’re on that space station and your arms are guns and you’re under attack. Drones fly about the room zapping you with lasers. Doors open behind you and robots roll in. From above, bad guys zap away at you, causing you to take cover under walkways.

You’re moving around but not getting sick because the walls in the game correspond with the space you’re in. One of the big issues with VR is when you lose your frame or reference, you lose your balance. I tried a skiing game a few days before this and literally fell over while standing on a flat surface, because I couldn’t tell which way was up. The Arkave fixes that, which allows you to move around without worrying you’ll get wacked in the nuts, and the moving around turns out to be the fun bit.

After I reemerged from the Arkave, I tagged Cambridge House boss Jay Martin to come try it with a Canaccord broker who happened to be standing nearby. It was a tough sell. Nobody wants to be in a goofy helmet in the middle of a business conference, so they gave me two minutes and were floored.

So floored, Canaccord literally set up and filled a $2m financing for YDreams immediately. You want in? Tough, it’s been filled. Big hitters. The right people. The sort of people who turn companies around.

Jay came out of the YD game with a huge grin and group texted everybody he knew at the show to get there and try it right away. From that moment on, you couldn’t get near the game without a one hour wait. When the rest of the exhibitors had wrapped up and left, there was still a line at YDreams.

We’ve talked about this company many times over the last few years because what they do is what most VR companies say they’re going to do – eventually. YDreams has been doing it for fifteen years. They’ve worked with A-list corporate clients like Audi and Nike and the World Cup and Coca Cola. And they have a thick catalogue of immersive tech that they can utilize when needed, for whoever wants it, without needing to develop more.

So why is the stock at $0.15? Because it came to market too early and because Brazilian currency isn’t worth nearly what Canadian currency is, and they haven’t yet made that jump between being able to sell here the way they do there.

But they have the tech. They have it in spades.

If they’d RTOed today into the Canadian markets, the valuation they’d bring would be stratospheric. But they arrived early and underfunded, so it’s a rehab play now.

Which is great for you, because you get to buy in at today’s share price and max out your profit potential, which is what I’m doing.

— Chris Parry

FULL DISCLOSURE: YDreams is not an Equity.Guru marketing client, but the author is buying in.