There's a lot of talk about metaverse stocks and the future of gaming, social interaction, and work. But there's no clear definition of what the metaverse is. Some think it's a fully digital virtual reality (VR) world we will immerse ourselves in on a regular basis, others feel it's more an expansion of our current digital worlds, and still, others see it as something new entirely. 

No matter what you think the metaverse will look like, it's likely to include more digital objects, improved social digital spaces, and new technologies like virtual and augmented reality in one shape or form. No matter what the metaverse looks like, the company positioned to profit from its growth is Unity Software (U -3.72%)

Droids in the metaverse.

Image source: Getty Images.

Why Unity is key to the metaverse

If digital places are a growing part of our future, those spaces need to be built by someone. Artists need to create 3D models and developers need to build the world and define its rules (gravity, how interactions with objects work, etc.). Most of the time, the best place to do this is within a game engine like Unity or Epic Games' Unreal Engine.

Unity is already the most popular tool for developers of mobile games with 61% of developers using its software. According to a survey by VisionMobile, 59% of VR developers are using Unity. It's Unity that's the development tool most companies use to make experiences for Meta Platforms' Oculus VR headsets. 

Accessibility is key for developers

Unity's business model is a key to its success long-term. As the metaverse is built, it isn't just big companies like Meta and Microsoft that are building digital spaces. Small projects are being built for companies and even non-fungible token (NFT) projects, which may only ever have a few developers and a few thousand users. But Unity's pricing structure of being free for personal use and then starting at just $399 per year per seat for projects with very little funding makes it accessible to developers building innovative projects.

The upside for Unity is that it has a big funnel of users coming into the ecosystem with the potential of growing entire businesses on top of Unity's software. Schools are even teaching Unity as a way to give students skills that can be used in the metaverse marketplace. 

Making powerful, easy-to-use tools for a wide range of platforms has made Unity a go-to piece of software already, and its growth potential is only growing. 

The toolkit is growing

Over time, Unity is adding to its software toolkit for developers, which both increases the potential base of users and locks in existing users. This is similar to the strategy Autodesk used over the last 25 years, starting with simple 2D computer-aided design tools and then expanding into 3D, animation, project management, engineering, and much more. But it started with a core group of users and then bolted on acquisitions that made its software both more valuable and stickier in the market. 

Unity recently did something similar with the $1.6 billion acquisition of Weta Digital. The high-end software has been used to make movies including The Lord of the Rings trilogy, various Godzilla films, and several Marvel films, but only a small group of developers used the software because it was under Weta's control. Under Unity, this powerful tool will be unlocked for potentially millions of developers, expanding Unity's reach into high-end games, movies, and metaverse worlds. 

What's key to understanding Unity is that it makes tools that will build almost any kind of 3D world, whether that's on a mobile device, PC, or in AR or VR. That's why this is the key company to the metaverse, no matter what the metaverse looks like. 

Unity stock is looking cheap

I like Unity's position in the market, and its stock is cheaper than almost any time since it went public. Twenty-six times sales isn't cheap by traditional metrics, but for a company that grew revenue 43% last quarter, it's not a crazy price to pay.

U Chart

U data by YCharts

I think this is a great buying opportunity for a company with a wide moat in 3D game development and an extremely bright future in building the metaverse. That's why I think it's the only metaverse stock you really need right now.