Home Virtual Reality News Celebrity-backed VR Destination ‘Sandbox VR’ Falters as US Subsidiary Files for Bankruptcy

Celebrity-backed VR Destination ‘Sandbox VR’ Falters as US Subsidiary Files for Bankruptcy


Virtual reality arcades and other out-of-home VR destinations have been some of the worst affected businesses during the COVID-19 pandemic. Sandbox VR, one of the most well-funded in the industry, has been no exception, as the company’s US-based subsidiary filed for bankruptcy recently.

Sandbox VR does business in the United States under the name Glostation USA Inc., which has filed for Chapter 11 (along with a number of associates) at the U.S. Bankruptcy Court in Woodland Hills, California. The news was first reported by The Wall Street Journal.

Sandbox operates multiple locations in North America and Asia, and hosts both branded VR content such as its Star Trek: Discovery experience and in-house developed games. Experiences last around 20 minutes and can accommodate up to six people per session.


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Despite having already reopened a handful of locations recently it appears the damage of staying closed for such an extended time has taken its toll on the company. Back in early June, Sandbox VR CEO Steven Zhao told Protocol that the company had effectively lost “100% of the revenue,” something that led Sandbox to lay off 80% of its staff. Former CEO Siqi Chen and a number of the company’s developers also left the company.

Since its founding in 2016, Sandbox has garnered over $80 million in outside funding, with the most recent round led by celebrities such as Justin Timberlake, Katy Perry, Orlando Bloom, and Will Smith. Sandbox was also funded by Andreessen Horowitz, Alibaba, Floodgate Ventures, Stanford University, Triplepoint Capital, and CRCM.


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According to WSJ, the company was close to securing over $50 million in equity funding prior to the pandemic lockdown. This was put on hold back in March, which ruined plans for the company to open around 20 new locations.

Still, Sandbox says its reached a deal with the company’s lenders to restructure debt and reopen its locations once things eventually get back to normal. Whether there will be a ‘normal’ in the short term still remains to be seen though. Many VR arcades, like Hologate have put in more visible cleaning and sanitizing regimes that they hope will ease the public back in, but it’s sure to be an uphill battle any way you slice it.

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