Meta spent $83.6 billion on Reality Labs to build Horizon Worlds, but internal memos show even Meta engineers refused to use it. Of 10,000 worlds launched in 2021, only 9% ever got more than 50 visitors. The division lost $18 for every dollar it made because the product solved no real problem.
Meta, Mark Zuckerberg's company, formerly known as Facebook, built an entire virtual universe, famously for $10 billion to create it. But in internal memos that came out later, it famously leaked that even the employees of Facebook didn't want to use it. The product's name was Horizon Worlds, and Mark's vision for it was that over a billion people would congregate and use it to communicate and basically leave reality and live in this new world. And when it launched in late 2021, there were over 10,000 different worlds. That you could go into when you're inside of this virtual reality. But the ugly reality was that consumers voted with their pocketbook, and of those 10,000 virtual worlds, only 9% of them were visited by more than 50 people. In other words, the metaverse was a virtual ghost town. VP inside of Meta, a guy named Vishal Shah, who was in charge of the entire product, and he circulated a memo which was, "Hey, I looked at our dashboards, and, uh, it's clear that the vast majority of us as employees and the engineers working on this thing don't actually want to use it. And like many CEOs at the time, in this case, this executive, he went and told his employees that they were forced to start using the metaverse. It was their job now. And look, this seems mean, but in reality, this was a good business technique called dogfooding, which is basically if you're gonna try to sell somebody something else, you should make sure yourself wants to use it as well, and especially yourself, but also the people in your organization. And if people don't want to use what you've built, well, that's a bad sign that customers probably won't want to use it either. But even with all this bad news, Reality Labs, the division of Meta that was doing all the virtual reality stuff, kept dropping money into building it. Eventually they would spend $83.6 billion, and by many measurements also, they lost $18 for every dollar of revenue that they got. So it wasn't a technology problem, and it certainly wasn't a marketing problem, and it wasn't a vision problem. Facebook was building something that fundamentally people didn't want, and whether those people were inside the company or outside of it, they weren't willing to pay for it. And in case of their employees, Facebook employees weren't willing to get paid to use it either. I did a deep dive, long-form video on the rise and fall of the metaverse. You can find it on my channel. There's a link below.
