Franklin Lyons’ virtual reality company all started with a foam yoga block.

Lyons, the CEO and founder of San Antonio-based Merge Labs Inc., transformed the block into a prototype for a virtual reality (VR) headset in his garage and built a profitable multimedia business. The San Antonio startup was among the first generation of companies to roll out mobile virtual and augmented reality (AR) headsets. While VR immerses a user in an experience, AR adds to the existing one – usually through the use of a smartphone device.

Lyons started Merge Labs in 2014, taking it from local tech startup hub Geekdom to one of the fastest-rising tech companies in San Antonio with its VR and AR products finding their way into classrooms across the world.

“Based on our [app] downloads, we think we’re in most school districts in the U.S.,” Lyons said. “We’ve had more than 150,000 downloads in India in one week. It seems to catch on quickly. … We’ve seen it happen all over the world.”

Since 2018, Merge’s VR and AR apps have been downloaded 20 million times, he said, a milestone the company just celebrated in January.

The Boerne-born San Antonio resident lived in several Texas cities growing up, ranging from the Rio Grande Valley to Castroville, and was in part inspired by observing his father’s entrepreneurship and inventiveness growing up.

A lifelong tinkerer himself, Lyons went on to get an art degree from San Antonio College and planned on a career in video game design. After graduating, Lyons held several web design and animation jobs, including working for Nokia on AR apps.

Facebook-owned Oculus Rift has had VR headsets on the market since 2012, but most of the headsets released at the time were fitted with their own screen. Merge headsets allow a user to insert his or her phone into the front and, through VR apps, act as the headset’s screen.

This smartphone-friendly headset was one of the first of its kind on the market and helped make VR more accessible, Lyons said. Whereas an Oculus headset and system may cost anywhere from $150 to $605 depending on the model and age, a Merge headset is about $40. It is available in major retailers such as Walmart.

“In this world, it’s a big deal when one of your apps or software programs launches, but I think it was a really surreal moment to go into a Walmart and see a Merge headset there on the shelf,” said Andrew Trickett, co-founder of Merge.

With the headset launched, Lyons said he wanted to work on making VR applicable beyond games and entertainment. Married to a high school English teacher, Lyons was inspired to start working on educational VR applications.

Lyons’ latest invention, the Merge Cube, was released in the fall of 2017. The foam cube allows users to physically hold and interact with 3D objects through AR. The cube works with a smartphone camera, replacing the cube on the phone’s screen with a projected image – from a beating heart to a moving model of the solar system.

Thomas Andrews, a biotechnology teacher at the John Jay Science and Engineering Academy High School, introduced his students to the Merge Cube this school year.

Paired with a class iPad, the Merge Cube allowed students to interact with 3D models of DNA, chromosomes, and molecules, strengthening their understanding of organic material the unaided eye can’t see, Andrews said.

“While I imagine education may not have been [Lyons’] first intended use, as a teacher I appreciate him thinking about ways of adapting it,” he said. “Seeing my students completely immersed in the lesson was really something.”

Today, Merge VR is an ed-tech company, Lyons said. With its own app store titled the “miniverse,” Merge hosts around 50 apps, more than a dozen of which have been made in-house.

Merge VR employees work in the company’s downtown office. Credit: Bonnie Arbittier / Rivard Report

With two homeschooled children of their own, Lyons and his wife Stephanie were able to test a lot of their novel ideas for apps on their 13-year-old daughter Lilah and 16-year-old son Gavin. Franklin recalls bribing them to play the educational VR and AR apps with $1 for any “bug” or error they found.

Lyons wants to be part of a shift in the VR space toward educational applications. VR has the potential to immerse kids in other worlds and inspire future scientists, doctors, engineers, and mathematicians, he said.

Market research predicts the virtual reality market in the education sector will grow by more than 59 percent by 2022, according to a 2018 Technavio report.

Within a new three-story downtown building housing startups such as FloatMe and venture capital firm Active Capital, Merge has taken over the entire bottom floor, with the company’s 20 employees of software developers, designers, and creators working around an open-concept layout.

Active Capital CEO Pat Matthews said he personally invested more than $100,000 in Merge during its early stages. Tech entrepreneurs such as Lyons that have made San Antonio their home are a boon to the local tech scene, Matthews said.

“I would characterize [Franklin] as a creative genius, he said. “He’s innovative and creative and amazing in that aspect. I’m glad to see he’s stayed in San Antonio.”

Lindsey Carnett

Lindsey Carnett

Lindsey Carnett reports on business and technology for the Rivard Report.