After years of hype, virtual reality still hasn’t achieved mainstream consumer adoption. But it sure helped my group of friends have a ton of fun earlier this month.
We spent a weeknight at Sandbox VR in Seattle, one of more than 45 locations worldwide where the San Francisco-based startup offers virtual reality experiences for groups of 2-to-6 people.
VR arcades are not new, though the technology has improved over the years. Sandbox survived the pandemic shutdowns and is now growing quickly after raising $37 million two years ago. It added 12 locations this year with plans for more in 2024. Its investors include firms such as Andreessen Horowitz and celeb investors including Justin Timberlake, Katy Perry, and Kevin Durant.
After our group arrived at the South Lake Union location in Seattle, we spent 15 minutes for training and setup. It takes some time to strap on motion sensors to your wrists and ankles, and get comfortable wearing the vest and headset, all powered by HTC technology.
We moved into an empty room lined with overhead sensors. We strapped on our headsets and soon saw each other as virtual avatars. We laughed and commented on how trippy it was to be together in a physical space but interact in this “metaverse” of sorts.
Sandbox offers an array of games it develops in-house, including “Squid Game Virtuals,” one of the company’s newer experiences based on the hit Netflix show. It launched in September and quickly gained popularity, generating $4.5 million in revenue for Sandbox in two months.
“Squid Game Virtuals” runs through various mini-competitions, just like in the show, though instead of being eliminated you get to respawn if you happen to move excessively in “Red Light, Green Light” or fall through the glass bridge.
There was a slight glitch to start but a few minutes later, the Squid Game began.
Players collect points throughout the experience and a winner is crowned at the end. There’s a fun element of both teamwork and potential sabotage that keeps things interesting.
The motion-capture tech worked pretty well, accurately sensing your body movements — key for something like this to really work.
After 30 minutes of gameplay, we took off the headsets and watched video replays of our experience. We had a lot of fun — which seems to be a common review, according to Mason McKean, a Sandbox employee who helped our group.
“My favorite part is seeing people come in from tech companies that are mainly introverts or typically more reserved, and seeing them come out of the experience with this big smile on their face,” McKean said. “You can tell that they’re elated and relaxed and unwound a little bit, which is wonderful.”
I would love to come back and try all the other games Sandbox offers. But I probably won’t.
Sandbox typically charges $50 to $55 per person for just 30 minutes of play. (Editor’s note: GeekWire received complimentary admission for purposes of this review.)
This might make sense for companies looking for a team-building event, or big groups celebrating birthdays or bachelor/bachelorette parties, as advertised on the company’s website.
But for me, it’s just too steep a price for too little return. The VR is definitely cool, but $50 could go a long way at a traditional arcade, pinball joint, or other forms of live entertainment. Or, I could invest in my own VR headset and play at home.
Whether Sandbox keeps growing remains to be seen. There are several competitors in the Seattle region, including Hive VR, Dimension XR, and Zero Latency.
Tim Harader, a longtime Seattle tech exec, founded a VR arcade company called Portal with his wife in 2017. The company, which had locations in Ballard and Bellevue, announced plans to shut down earlier this year.
Portal’s business was growing and reached profitability just before the pandemic began in 2020, which hit physical retail and entertainment venues hard given restrictions on indoor gathering.
Harader cited other pandemic-driven impacts — people staying at home more and the shift to remote work — as well as increasing labor costs that contributed to Portal’s demise.
He isn’t sure if the VR arcade business is sustainable moving forward.
“For location-based entertainment venues, it’s a balance of reaching your maximum capacity versus your operating expenses,” he said. “It may work in some places but not others.”
Offering food and beverage could help boost revenue, he added.
Other Seattle-area venues offering VR arcades have shut down in recent years, including VR Go, Virtual Sports, and Odyssey Virtual Reality.
Harader, a former longtime Microsoft exec, is now a vice president at Librestream, which develops augmented reality technology for industrial companies.
While there are some established enterprise use cases for VR and AR, the consumer market still lacks a breakout app and headset sales dropped nearly 40% this year, according to CNBC.
Even with Apple set to release its Vision Pro headset next year and Meta continuing to invest heavily in the sector, Harader believes we’re still years away from mainstream consumer adoption. The technology just isn’t good enough, he said.
“When you think about the required power and battery life and visual clarity you need for a device that you’re going to wear for more than an hour or two — nothing is there yet,” he said. “They still have to develop better battery technology, better display technology, and more powerful compute.”
In the meantime, companies such as Sandbox — which opened a new development studio in Vancouver, B.C., this year — will try to draw customers into their locations. In a statement to GeekWire, Sandbox CEO Steve Zhao said people are “gravitating towards immersive experiences and VR is a conduit to that.”
“You see companies continue to invest in VR,” he said. “There are a lot of folks everywhere hedging on this bet because immersion is something that gamers want, and is a natural progression.”
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