Following the last workshop with National Initiatives on the Business models of Virtual Worlds , this session pivots the perspective onto SMEs and Startups. This session mapped the issues and patterns that have been noticed across the European XR landscape, particularly in the business ecosystem. Several players were brought to the table on 25 February 2026, opening the conversation by inviting the participants to share their views and experiences in their participation in the networks and activities of National initiatives. While the demonstrated works of these essential players are important, removing survivorship bias and focusing on main issues experienced regarding the network are equally important.
SMEs and Startups as the cornerstone of Virtual Worlds
The different projects done by participating enterprises were inspiring but still bring about difficult topics regarding funding. Constraints such as lower budgetary capabilities of these enterprises usually mean relying on collaboration to pull resources together or share expertise. As such, this provided positive pathways towards solidifying reliability in networks by prioritising collaboration. Partnerships in this scenario then allowed for collective growth, and for companies to have better opportunities in locating and securing grants.
The workshop highlighted the important contribution of the SMEs and Startups in an industry dominated by Big Tech and discussed their experiences navigating National Initiatives Ecosystems as lean enterprises. Understanding the pain points of smaller and impactful players in the Virtual Worlds is paramount for the growth of the industry.
Key consensus among participants
Industry players agree that community networks, both national and international, are important for growth and scaling of the companies as they provide a wealth of information and contact points which promotes cross-border collaboration and improves the functioning of the EU Single Market.
Described as a “firehose of information” by one of the representatives, the network provides a vast array of valuable resources for companies. Conversely this wealth of knowledge and contacts can at times be overwhelming especially for new entrants.
Underscoring these positive aspects, several issues remain pertinent for these players, such as:
Access points and contacts
The main bottleneck is experienced before joining the network, where they do not have knowledge that the network exists. While the network is important, referral to the right contacts is also equally crucial due to the overwhelming knowledge and contacts available.
Navigating the funding process
Funding is not as straight forward on the European level compared to the national level. Small teams are sometimes unable to afford additional resources towards the application of EU level funding due to the necessary regulations. In relation to the contacts, it is also difficult to know if there is a coordinated activity that is targeted towards a specific EU proposal.
Short term funding issues compared to long term technology development
One of the problems faced by companies is the lack of funding, especially in lean environments like SMEs and Startups in emerging industries. Technological developments are often long-term projects which requires consistent funding, thus leading to precarity for smaller companies who have proof of concept or market-tested pilot.
Clearer pathways toward procurement
The precarity for smaller companies are also contributed in part due to unclear pathways towards procurement. This can be due to the lack of demand in the domestic market, which can be remediated by utilising networks such as the one built by OPENVERSE to connect across national markets.
Importantly, some companies have initiated to coordinate efforts in order to address issues of navigating through bureaucracy to access the funds at the European level as well as network sharing to aid each other.
Trudging on
This workshop affirmed that smaller companies are key in creating vibrant networks in national initiatives’ ecosystems, but it also helped shine a spotlight on crucial weaknesses faced within the industry. Companies from different national markets still have difficulties accessing networks and applying for funds. Coordination on the European level also poses a problem for them. Although the XR community is very open to collaboration, they have trouble finding the right connections. This is where the proactiveness of industry players and wide European networks like the one built by OpenVerse can play a pivotal role.
OPENVERSE can be seen as a reference point for clustering information and stakeholders and creates and ecosystem of XR talent and networks that will help this industry thrive in the EU. The OPENVERSE observatory can also be useful in enhancing the visibility of smaller companies whereby it can be useful to provide the first level of access and initial step towards collaboration.
For a deeper dive, the full report can be downloaded here.