Oculus VR went from a $2 million company to a $2 billion company in 18 months

WHAT happens when a 20-year-old college dropout puts an idea on Kickstarter? In this case, he became a billionaire in 18 months. Here’s how.

AS I’M sure you’ve already read, Facebook recently acquired Oculus Virtual Reality for $2 billion.

This is a huge deal, and here’s why:

Brief company timeline:

August 2012: Oculus Rift raises $2.5 million on Kickstarter

June 2013: Oculus Rift raises $16 million in venture capital

December 2013: Oculus Rift raises another $75 million, led by Marc Andreessen

March 2014: Facebook buys Oculus VR for $2 billion.

Palmer Luckey, chief executive of Oculus, went from:

“I’ve got an idea” to “I run a $2 billion company” ... in under 18 months. Ouch!

A few more impressive numbers:

The boss is a 20-year-old college dropout.

The company had only 50 employees at the time of its $2 billion exit.

News_Image_File: Oculus VR’s chief executive, Palmer Luckey, is only 20 years old.

This is one of the more striking examples of exponential growth of late, and hits on many of the lessons we’re learning about at the Abundance 360 Summit.

Let’s break down why this is so incredible.

CROWDFUNDING

As we’ve discussed, crowdfunding can help you secure your seed investment (which for Oculus was $2.5 million) by validating your market and fit. Then, with the momentum you build, you can raise venture capital. In this case, that meant $95 million.

This deal substantiates the claim that the value of crowdfunding is so much more than just the money raised during the campaign. Oculus VR received incredible market validation and curated a massive network of passionate developers to push the technology (and business) forward.

THE USER INTERFACE MOMENT

As we discussed at Abundance 360 this year, the key to monitoring exponential technologies is looking for user interface moments, which herald something big. Very big, (If you are unfamiliar with the term “user interface moment,” think back to the Mosaic web browser created by Marc Andreessen. It was the moment when “the web” became useful to the world).

News_Image_File: Oculus Rift virtual reality gaming headset which Kickstarters helped fund.

THE NOVICE BREAKTHROUGH

There have been many attempts to bring virtual reality headsets to mainstream audiences, and hundreds of millions have been spent in the process. This breakthrough didn’t come from an expert (who normally can tell you what can’t be done) but from a passionate novice who didn’t know what couldn’t be done. So, it would only make sense that Marc Andreessen was the lead investor in Oculus VR — a veteran in spotting the true “user interface moment” and capitalising on timing.

EXPONENTIAL ORGANISATIONS

The story of Oculus VR is another incredible validation of the power of exponential organisations. Like the examples of exponential organisations before it, Instagram, AirBnB and WhatsApp, this story has all the pieces of the exponential organisation puzzle: A massively transformative purpose, a small team, use of exponential technologies, use of the crowd and community, etc.

PASSION TRUMPS ALL

How can a 20-year-old USC dropout succeed where experts of the past have failed? Passion. This story should inspire everyone to pursue his or her passions. Mr Luckey, the founder and creator of Oculus VR, had but one goal: make video games even better than they already were.

Once Palmer realised he could use virtual reality to fulfil his dream, he did everything in his power to make it come true.

News_Image_File: Mark Zuckerberg splashed out $2 billion for the company.

Luckey’s approach to this was simple: “Use virtual reality to make me love something more than I already do.” You need to build things with a purpose. Pursue things with a fiery passion that gets you out of bed in the morning. Don’t just go build something for the sake of building something.

I hope you find this useful. I wanted to bring to life some of the critical lessons we studied together at Abundance 360 so you can remind yourself how to apply them in your own start-up or business.

At the next Abundance 360 Summit, I plan on diving even further into virtual reality and the huge boom it could create across all industries. The potential impact it will have on the cost of business, travel, real estate, etc. is enormous. I hope to see you there.

My massively transformative purpose is: “To empower entrepreneurs to create extraordinary wealth while creating a world of Abundance.”

This story originally appeared on The Huffington Post. It was republished with permission.