Mike Hayes, former CEO of Sega and current head of the e-commerce division at Mercia Fund Management, is one of those people who when they speak, people listen. So when he says the VR video game market will be worth “$5 billion to $6 billion” in the next “two or three years,” you better pay attention because he could very well be right.

Right now Virtual Reality is in a bit of an aqueous state, in terms of the consumer market, nobody knows for sure what will happen when Oculus releases the CV1 in however “many months” or even when Samsung Gear VR comes out next month, but a number people are making some educated guesses, and the numbers are extremely promising.

A recently published report by the advisory firm, Sophic Capital titled Virtual Reality: A Virtual Goldmine for Investors had similar projections for the VR market as the ones reported by Mike Hayes, predicting that by 2018 the VR market could reach $7 billion “with room to grow.” This figure is taking into account a predicted $2.3 billion VR hardware market and a $4.7 billion VR software market. The report went further, predicting HMD sales to grow from 200,000 to “about 39 million over 5 years.”

These projections, coupled with the rapidly growing video game market, projected to reach $111 billion next year, up about 20% from this year, make the market one incredibly enticing for investors. With venture capital firms like Rothenberg Ventures lining up to put needed funding into the space, things are about to get accelerated at a breakneck pace.

So how do these predictions for the growth of the VR market stack up against the last big platform release, the smartphone? Quite favorably actually. When the iPhone was released in 2007, it sold 1.39 million units, 3 years later those sales were up to nearly 40 million units, an increase of over 2750%, which seems high – because it is. The iPhone is one of the most lucrative products ever created, which makes what I am about to say even more poignant… according to these projections, sales for HMDs are expected to increase 13,150% over the next 3 years. Let that sink for a moment, thats an adoption rate nearly five times faster than the iPhone. VR is coming, soon, and is going to take the world by storm in a way never before seen. Batten down the hatches, it’s gonna be a wild and crazy ride.

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Graph courtesy of KZero Worldswide.