Interview, Fireside Chat, Other
Founding Stories: Sandbox VR
- Sandbox VR co-founders Steve Zhao and Siki Chen built a full-stack, location-based entertainment model from scratch because existing VR technology, content, and retail spaces were unavailable at the time.
- The founders drew a strategic analogy to the Hollywood motion picture industry (1910s–1948), noting that early cinema required the creation of studios, distribution networks, and a vertical integration model before consumer adoption.
- Initial fundraising efforts in Asia (Hong Kong, China, Japan) failed because investors could not visualize the product without physical access to a location, as their perception of VR was limited to home-based headsets.
- Investors initially rejected the business model due to the difficulty of scaling a physical retail operation combined with custom content creation and proprietary technology.
- In early 2017, with only one month of runway remaining, CEO Steve Zhao invested his entire life savings to keep the company alive and convinced the six-person team to work for six months without salary increases.
- The team built the first prototype and launched a location in a low-traffic 16th-floor high-rise in Hong Kong in late June 2017, relying on organic word-of-mouth and social media virality for initial traction.
- The product differentiates itself from home VR by supporting up to six simultaneous users with body tracking, allowing for physical social interactions like high-fiving and handshakes within a shared virtual space.
- Unlike home VR which focuses on visual immersion, Sandbox VR prioritizes "embodiment" and social agency, allowing users to interact with each other's avatars and physical movements.
- The first successful title, "Deadwood Mansion," was a zombie shooter that achieved top-20 Steam sales numbers but lost over 90% of its potential revenue due to insufficient user adoption in the in-home VR market.
- The shift to location-based entertainment allowed the team to achieve a working business model with a high-quality, 30-minute AAA title produced in less than six months with minimal capital.
- Alibaba Hong Kong Entrepreneurs Fund led the seed round after the lead investor tried the product and confirmed the experience caused zero motion sickness, stating it "felt like real life."
- Siki Chen, initially an external angel investor and skeptic who called the pitch "the dumbest pitch," committed to the company only after personally testing the experience and observing the "holodeck" reality.
- The company secured a Series A term sheet within four days of opening its store, driven by immediate market traction and a concentrated fundraising strategy targeting over 400 investors in the Bay Area.
- Andreessen Horowitz (A16Z) investment thesis relied on the team's "games DNA" and focus on interactivity, viewing the product as a hybrid of movies and games rather than a passive media experience.
- The founders plan to move away from shooting-centric gameplay in the near term, introducing non-weapon props and new genres to cater to a wider audience beyond shooter fans.
- Long-term technology goals include eliminating physical walls to create immersive spaces for dozens or hundreds of concurrent players and integrating immersive actors into the experience.
- Future content development aims to evolve beyond the "silent film" era of VR shooters toward diverse genres including e-sports, narrative dramas, dance, and training simulations.
- Key technical investments focus on deep learning and computer vision to translate body language, facial expressions, and non-verbal cues into the virtual environment without requiring facial cameras on the user.
- The founders view the current state of VR as analogous to the early Western genre in cinema, anticipating the emergence of new conventions, storytelling formats, and media categories over time.