(Bloomberg) -- Billionaire Mikhail Prokhorov is betting that party lovers may have to get by with virtual reality in this time of lockdowns and pandemics.
The Russian mogul who sold the Brooklyn Nets basketball team last year is backing a startup that streams concerts of famous DJs in a wager on the still-nascent virtual-reality industry. The company, Sensorium Corp., is controlled by Prokhorov, one of the investors who’ve poured a combined $100 million since it started in 2018, the firm said Monday in a statement.
“Sensorium looks like one the best funded VR-related experiments out there,” said Joost van Dreunen, an adjunct assistant professor at New York University’s Stern School of Business, adding it’s a risky bet given how early-days the industry is. “We have to ask the question: If Covid-19 benefitted every other aspect of gaming in recent months, where is the evidence that consumer adoption of VR has accelerated?”
Prokhorov made his fortune -- valued at $12 billion by the Bloomberg Billionaires Index -- with metals producer MMC Norilsk Nickel PJSC. His holdings now encompass industries from finance to energy generation, with his latest investments linked to his personal hobbies. He likes to party in places like Spain’s Ibiza, according to some of his associates.
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Sensorium, based in the Cayman Islands, creates party venues in the “Sensorium Galaxy” with the cooperation of partners from the music and entertainment industry. Visitors can enjoy shows, socialize with friends and buy accessories for their avatars using blockchain technology.
Epic Games Inc., the maker of Fortnite, is a Sensorium partner. Yann Pissenem, the electronic dance-music producer behind popular nightclubs Ushuaia Ibiza and Hi Ibiza, is developing a virtual venue in the “Planet of Music” -- the first planet in the “Sensorium Galaxy star systems.”
Virtual entertainment may help avoid some of the pitfalls of in-person events, such as last month’s concert in the Hamptons featuring the Chainsmokers and Goldman Sachs Group Inc. head David Solomon as DJ. The charity show sparked a state probe after New York Governor Andrew Cuomo said he was appalled over “egregious social distancing violations” seen in footage of partying crowds at the July 25 event in Southampton.
While Facebook Inc. and Microsoft Corp. are among the companies that have invested in virtual reality, the technology has yet to take off. Its headsets are far less widespread than desktops or mobile phones, and there’s a lack of content for users to enjoy.
Prokhorov, a 6-foot-8 basketball fan, bought the club known as the New Jersey Nets in 2009 and moved it to a new arena he built in Brooklyn. He sold both last year to Alibaba Group Holding Ltd. co-founder Joe Tsai for an estimated $3.5 billion in one of the largest deals in National Basketball Association history.
Nassau Coliseum, an arena in Long Island operated by Prokhorov’s Onexim Sports and Entertainment, will shut indefinitely while the firm seeks investors to take over operations and pick up the remaining debt on the building, people familiar with the matter said in June.
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