There are good reasons to be skeptical that virtual reality will change technology the way smartphones did, at least in the near term. While the latest headsets and software can make for dazzling demonstrations, even many fans of virtual reality say they still have not experienced a must-have game or application. The required headsets are expected to cost $300 to $500, in addition to the $1,000 or more it will cost for a powerful PC that some will require. And the virtual worlds inside the headsets have induced motion sickness in some people.

What makes the virtual reality investment craze even more speculative is that few members of the general public actually own or have tried the headsets.

High-profile products from Oculus, owned by Facebook, as well as HTC and Sony will not go on sale until next year. (More rudimentary, less expensive devices that rely on a user’s smartphone screen are now available, such as Gear VR, from Samsung, and Google Cardboard.) By the time many top investors began putting money into mobile start-ups, in contrast, there were already millions of smartphones in use.

But none of that is stopping the enthusiasm or the outpouring of money.

In the first nine months of this year, virtual and augmented reality companies raised a total of $408 million, up from $145 million during the first nine months of 2014, according to CB Insights, a research firm that tracks venture capital investments. Since the start of 2012, companies in the sector have raised nearly $1.5 billion in total, the firm estimates.

One of the biggest players so far is Magic Leap. The company’s plans for a large new funding round, revealed in a corporate filing obtained last week by VC Experts, a provider of private market data, is on top of $542 million the company raised last year in an investment led by Google. Augmented reality devices like the one Magic Leap is developing do not block users’ view of their physical environment the way virtual reality headsets do, but instead insert game characters and other images into a person’s field of vision.