Mark Zuckerberg bet $90 billion on the metaverse in 2021, but Horizon Worlds peaked at 300,000 users while Roblox had 60 million. Meta's losses grew from $10 billion to $16 billion annually. ChatGPT's 100 million users showed people wanted tools that augment reality, not replace it. Meta shut down the effort by 2026.
Mark Zuckerberg famously announced that he was going to change the entirety of tech by creating a virtual reality world. It's called the metaverse. In October 2021, he announced that he was going to rename the entire company Meta, backing up his commitment to the vision. Our company is now Meta. The new company Meta, formerly Facebook, would go on to invest $90 billion to create the metaverse. But in March 2026, as I'm recording this, they they shut the whole thing down and threw in the towel. The context is, is back in October 28th, 2021, Facebook had actually been working on virtual reality after its purchase of the Oculus Rift headsets for nearly 7 years. But Mark needed a message, and the reason he needed a message about the future was that the current reality was bad for Facebook. Leaked documents found by the Wall Street Journal showed that basically Facebook knew that Instagram was harming teens, especially teen girls, and they'd also been critical in helping spread misinformation. For years. Like many CEOs faced with bad news, they needed a narrative reset. The narrative reset was, "We're going to reshape everything people know about technology by creating the metaverse and virtual reality." So Facebook started pouring massive amounts of capital expenditures to create it. They lost $10 billion in 2021, $13 billion in 2022, and $16 billion in 2023. The flagship product would be called Horizon Worlds, a virtual reality that you or I would go into. The bad news was it peaked at just 300,000 users. To put that into comparison for you, Roblox, the game played by teens including my kids, has 60 million users per month. Later in 2022, Mark would post probably the biggest product of Horizon Worlds, which was an internet meme. He posted himself with a selfie inside of a virtual world of Horizon Worlds. It looked chunky, blocky, and he looked kind of dorky. In other words, the main product of $10 billion of investment was people making fun of him. Then in 2022, he and his company were blindsided. OpenAI released ChatGPT, which would reflect what people really want from the internet, which is to make the internet make the world better rather than replace it with virtual reality. And ChatGPT, their product, would be the fastest product in history to reach 100 million users. The reality is Mark, as rich as he is, has pressure from outside folks. He has to pivot. And in March 2026, they announced that the entire $90 billion virtual reality initiative by Facebook, now Meta, would be shut down for good. The fascinating thing where he invested more than the GDP of Morocco. Human beings and the products you offer them, you have to understand, you got to build something that goes with human nature. And virtual reality, by its nature, pushes people away from reality. And that's not something we each want. In the end, consumers are great. No matter what they tell you they're going to do, what they do with their pocketbook is what they truly want. And in this case, Mark finally got the message that virtual reality wasn't something that people wanted. I did a long-form video about the rise and fall of the metaverse and Web3. If you're interested in it, there's a link to it in the comments below.
