Facebook has announced it will buy Oculus VR, a Californian company which specialises in virtual reality products, for around $2bn (£1.2bn).
The start-up’s flagship product, the Oculus Rift, is a goggle-like “immersive” headset for video gaming.
It was developed with funds raised through crowdfunding site Kickstarter, and subsequent investment.
Facebook’s boss, Mark Zuckerberg, said Oculus’ technologies could “change the way we work, play and communicate”.
The Oculus Rift has yet to be released, but more than 75,000 orders for development kits have already been placed, according to the social media giant.
In a statement released on Tuesday, Facebook said it plans to expand the use of Oculus technologies to include “communications, media and entertainment, education and other areas”.
Oculus’ crowdfunding campaign raised $2.4m (£1.5m), 10 times the amount originally sought.
It subsequently received a further $75m from investors.
The Rift headset was widely heralded at the CES technology show in Las Vegas in January, where Sony also announced a rival product.
The deal includes $400m in cash and just over 23 million Facebook shares, valued at $1.6bn.
Oculus employees will also receive an additional $300m if the company achieves certain targets.