Insights from Martin Herdina (ex-CEO, Wikitude; former Global Lead XR Partner Ecosystem at Qualcomm), in conversation with Samira Advisors.
For more than a decade, Augmented Reality has promised to change how people work, shop, learn, and navigate the world. Yet commercialization has been slower than many expected. The reason is straightforward: AR is both technically difficult for users to adopt. The technology must work reliably in real-world environments, and users must learn a new way of interacting with digital information in physical space. Now the AR market may finally be moving toward something more practical and investable.
In our recent conversation with Martin Herdina – who has spent more than 15 years building AR platforms, including leading Wikitude until its acquisition by Qualcomm – one message stood out: The industry is shifting away from large, fully immersive AR visions toward simpler smart glasses that people already understand. These devices are increasingly combined with AI assistants, which changes both how the technology is used and how companies think about acquisitions.
AR’s long arc: why progress took longer than expected
Augmented Reality is difficult to build because it requires many technologies to work together: sensors, hardware, tracking, computer vision, algorithms, and a comfortable device design. Even when individual technologies exist, they must be integrated into a reliable product that works consistently in everyday environments.
Another challenge is adoption: AR introduces a new user interface. People are not yet used to interacting with digital content that appears directly in their physical surroundings.
This is why the market has repeatedly experienced periods of excitement followed by disappointment. Expectations were often high, but product development took longer than expected. These expectations were sometimes amplified by broader technology trends such as the “metaverse”. Entering 2026, the industry is becoming more pragmatic. Instead of pursuing the full AR vision immediately, companies are taking smaller steps – launching simpler products that are easier for users to adopt. This approach is gradually narrowing the gap between what the technology promises and what products can actually deliver today.
Market maturity in 2026: VR plateaus, smart glasses accelerate
To understand where the market stands maturity-wise, a distinction across the XR spectrum should be made.
1. VR: mature technology, constrained growth
On the virtual reality side, the core technology is largely mature. Fully immersive headsets are improving incrementally, but there are fewer fundamental breakthroughs. VR hardware has also become increasingly commoditized. Consumer growth appears to be stabilizing. VR remains strong in specific areas such as:
- training and simulation
- enterprise workflows
- gaming and location-based entertainment
For M&A, this means fewer transformative acquisitions and more selective acquisitions of specific capabilities.
2. Smart glasses: an easier path to adoption
Smart glasses represent a different opportunity because they have a much lower adoption barrier. People already wear glasses or sunglasses. If a device looks normal and offers a clear benefit, users are more likely to try it. Early smart glasses have succeeded by focusing on simple features such as taking photos or videos, sharing content, and hands-free interaction.
These are easy for users to understand. Over time, these devices can expand their capabilities. Increasingly, smart glasses are evolving into personal AI assistants – devices that allow users to interact with AI through voice while receiving contextual information about their surroundings. This means smart glasses can start with practical functions and gradually introduce more advanced AR features such as visual overlays.
For the market, this has an important implication: Market growth will depend less on impressive demonstrations and more on whether people actually use these devices in daily life.
From an M&A perspective, the market is still forming
So, where is the market today? Early experimentation, first consolidation, or already defined winners?
According to Martin Herdina, 2026 is a period of active experimentation and repositioning: Companies are building ecosystems rather than focusing on single products. As a result, M&A activity is currently less about acquiring revenue and more about acquiring capabilities. Companies are buying technology, teams, and intellectual property that help them build future AI-driven wearable platforms. This means the market is pre-consolidation. However, consolidation is already happening at the technology component level, even though it is not yet clear which end-to-end platforms will dominate.
Who is buying and what are they really acquiring?
There is a wide set of potential acquirers converging on the same prize: ownership of the next primary interface for A:
1.Big tech platform players
The Apple / Google / Meta cohort is motivated by ecosystem control: distribution, OS-level integration, developer leverage, and default access to the user. The goal is to ensure their assistant, services, identity layer, and monetization model remain central as interaction shifts away from phones.
2. Computing and enabling technology providers
Semiconductor and infrastructure companies such as Qualcomm and NVIDIA are active because smart glasses are compute-constrained, power-constrained devices where architecture decisions matter. Their acquisition logic ranges from owning critical IP to moving up the stack into enabling software layers, reference designs, and ecosystems.
3. AI-native and new interface entrants
As AI platforms compete to become the default assistant, wearable distribution becomes strategically attractive. AI-first players are seeking to extend their presence beyond smartphones and desktops into always-on personal devices.
4. Capital with conviction
While strategic buyers dominate, certain financial investors with long-term horizons are also positioning themselves selectively. What is being acquired includes technology, IP, teams, and time-to-market acceleration. The primary objective is capability build-up rather than near-term profitability.
Acquisition strategies in this market often combine several motivations:
Defensive positioning
Companies want to avoid losing relevance if user interaction shifts from smartphones to wearable devices.
Capability development
Buyers are filling technology gaps in areas such as optics, perception, power management, and human-computer interaction.
Platform positioning
Companies want to secure a strong position in what could become the next major computing platform. Because the future leadership of the market is still unclear, many companies feel pressure to act early.
Where consolidation is likely next: components first, use cases second
“Personal AI” devices, whether glasses, pins, pendants, or other wearables, require a stack of capabilities. This creates consolidation hotspots across the technology stack, including:
- Optics and display technologies
- Sensors and perception
- Voice and multimodal interaction
- Data interpretation layers
- Miniaturized user interfaces
A clear sequencing dynamic is emerging: capability acquisitions first; use-case differentiation later.
Once many players can build technically viable personal AI devices, differentiation becomes harder at the hardware level. Competitive advantage will increasingly shift toward use cases and sustained engagement.
This suggests a two-wave market:
- 2025-2026: capability and component accumulation (M&A-heavy, roadmap-driven)
- 2027 onward: use-case ecosystems, distribution, and competing for retention
Valuations and deal structures
When it comes to valuations, Pricing is often driven less by traditional financial metrics and more by strategic importance and scarcity.
In early-stage AR/smart-glasses M&A, the key valuation drivers being:
- Tech assets and defensibility: optics/display breakthroughs, tracking/perception IP, power-efficient architectures, on-device inference enablers, and hardware-software integration know-how.
- Talent density: “brains” and execution teams that can ship in a product environment.
- Strategic fit with a roadmap: the buyer’s ability to deploy the asset into a product within a defined window.
Revenues don’t really count at this point. Many acquisitions are not buying products with predictable cash flows; they’re buying components that enable future products. Given that uncertainty, one might expect earn-outs and milestone-heavy pricing. But the opposite might actually be true in an environment where performance milestones are hard to define when the acquired assets are not revenue-generating products. Buyers frequently prefer clean ownership structures, typically combining cash and equity. This approach simplifies integration and accelerates execution.
Founder playbook 2026: keeping strategic exit options open
For founders building in AR, smart glasses, or enabling layers, use cases will become a scarce asset. If a company focuses only on technology without building real usage, it may struggle later when large platforms have already secured the core capabilities they need. By contrast, companies that build products people actually use can create strong independent businesses – and keep strategic options open for the future.
Smart glasses and personal AI are not immune to the hype cycle. Expectations are high, and major launches are coming. If projections are not met, sentiment and investment could cool quickly.
So what will define the next phase?
- Real-world performance at scale: reliability across varied lighting conditions, environments, and social settings
- Sustained usage metrics: retention, daily active usage, and repeat behaviors beyond initial novelty
- Comfort and social acceptability: form factor, battery life, heat, and visible privacy cues
- Clear “killer workflows”: moments where glasses are the best – or only – interface
- Platform lock-in dynamics: which assistants become the default, and how they achieve distribution
Closing perspective
2026 is a period of unusually high strategic activity across smart glasses, personal AI, and the long-term path toward mass-market AR. The market structure is still fluid, with multiple plausible platform outcomes. In that context, acquisition activity focuses on assembling the technological and organizational building blocks required to compete, followed by an increasing emphasis on use cases that drive sustained adoption.
If you own scarce enabling IP (optics, tracking, low-power perception, interaction primitives), 2026 can be a seller-friendly window because multiple strategics are buying speed.
If you own a widely adoptable use case that fits the constraints of early smart glasses and scales into richer AR, you may become disproportionately valuable in the next wave, when differentiation shifts from “can you build it?” to “will people actually use it?”
The industry is finally narrowing the gap between vision and reality – not by jumping directly to the final vision, but by building a credible path toward it.
In Conversation with Martin Herdina
