Matrix Partners extends winning streak with huge Oculus sale to Facebook


For Matrix Partners, a storied venture capital firm whose past investments have included Apple Computer and Netezza, 2014 is shaping up to be one of its best years yet, says general partner Antonio Rodriguez.

January saw the IPO of and February included the acquisition of The Echo Nest by Spotify, both of them portfolio companies for Matrix. Now comes the news that virtual reality startup Oculus VR, in which Matrix was an early investor, is set to be acquired by Facebook for as much as $2.3 billion.

See related post: 10 Matrix Partners-backed companies in Boston

Rodriguez, who is based out of Matrix’s Cambridge office, led his firm’s two investments into Oculus last year (totaling $18.5 million), and holds a board seat with the company.

The investments, Rodriguez told me Tuesday, stemmed from his focus on “post-PC interfaces,” a space he says he’s been pursuing since joining Matrix in 2010. “I’ve spent a lot of time going around to different parts of the country looking at augmented reality stuff and virtual reality stuff,” Rodriguez said. “For most of the stuff I had seen, it was years away from anything you’d want to use.”

After being introduced to Oculus by a friend, Rodriguez visited the company at its office in Irvine, Calif., while the startup was running its Kickstarter campaign for the Oculus Rift headset in 2012. Another Boston VC firm, Spark Capital, had independently been looking into Oculus.

Matrix and Spark would join up to lead a $16 million Series A round for Oculus in mid-2013, then went on to both take part in a $75 million Series B for the company in late 2013.

Antonio Rodriguez

Antonio Rodriguez

The acquisition of Oculus by Facebook — the second largest yet for the social networking firm, behind the $19 billion acquisition of WhatsApp — “was unexpectedly fast,” Rodriguez said. “It’s the advantage of getting early to a platform and owning a new medium.”

At the time of the Series A last June, Rodriguez blogged on the opportunity he saw in Oculus: “Many predict that wearables are the next frontier, but most of these devices attempt to coexist with the real world around you … Oculus’ headset, the Rift, brings you directly into a world completely controlled by its combination of hardware and software in a unique way that has been the dream of immersive game makers for decades.”

Rodriguez also posted a blog on the Facebook acquisition here.

Facebook said the acquisition deal includes $400 million in cash and 23.1 million shares of Facebook common stock, bringing the acquisition price to approximately $2 billion. The deal could rise by another $300 million if certain milestones are achieved.

“Oculus has the chance to create the most social platform ever, and change the way we work, play, and communicate,” Facebook chief executive Mark Zuckerberg said in a statement.

For Matrix Partners, the winning streak is not likely to grind to a halt any time soon: 2014 IPO contenders HubSpot and Zendesk are among the other companies in Matrix’s portfolio. Both companies are “working hard to build something big,” HubSpot cofounder and CTO Dharmesh Shah said in a tweet.

Kyle Alspach has worked in journalism in Massachusetts since 2005 and was one of the original staff writers at BetaBoston.
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