Photo by Giu Vicente on Unsplash

Last October, we wrote about a startup called Sandbox VR, which had raised a funding round from investors including Katy Perry, Justin Timberlake and Will Smith. Its focus was on ‘location-based virtual reality’ – VR installations that people could visit and use, as an alternative to having their own VR headset at home.

There are a number of these startups running VR gaming centres in shopping centres in the US (and other countries) but guess how the Covid-19 pandemic has impacted their businesses. Yup: horribly.

“We went from a relatively healthy business to zero revenue,” Sandbox VR boss Steve Zhao told Protocol, for a feature about the sector’s problems. “Literally, 100% of the revenue is gone.”

As the article explains, Sandbox VR has laid off 80% of its staff, and is now ‘trying to figure out not only how to reopen existing locations but survive’.

The wider story here is that VR centres were supposed to be one of the things that would reignite growth in virtual reality: a way for people to try out the tech without buying a headset.

The revenues have disappeared during Covid-19, but there are also longer-term fears over people’s willingness to visit these centres even when the pandemic eases. “When you go somewhere where you have something that you put on your face that someone else has put on their face… that’s a challenge,” as one analyst quoted in the piece puts it.

Photo by Giu Vicente on Unsplash

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Stuart Dredge

Music Ally's Head of Insight

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