Sandbox VR Series-A

This is the Sandbox VR pitch deck to raise their $68m series-a round in 2019.

So according to my friend who knows a founder, Sandbox VR was doing great and then COVID came, and well. Do the math.

Interestingly, Justin Timberlake, Katie Perry, Kevin Durant, Orlando Bloom and other famous people invested.

About

Funding rounds

Announced Date	Transaction Name	Number of Investors	Money Raised	Lead Investors
Oct 22, 2019	Series A – Sandbox VR	14	$11M	Andreessen Horowitz, David Sacks
Jan 29, 2019	Series A – Sandbox VR	8	$68M	Andreessen Horowitz
Dec 14, 2017	Seed Round – Sandbox VR	5	$3M	Alibaba Entrepreneurs Fund
Nov 22, 2016	Seed Round – Sandbox VR	2	—	—

Video on their fundraise

They go slide to slide, so to be honest, watch the video and ignore me 😉

Structured summary review

Words

It’s a tad on the short side. They should add sub headers on each slide at least. The deck really feels like it is meant to be talked to. I presume the founders know investors already.

Slide length

It’s good enough to get a meeting. It’s not a deck I would have written, but it certainly does the job.

Headers

They use their headers (though they aren’t where I would put them, which is like, in the header) well to tell a story. All the slides flow pretty well. The wording is a little terse for my liking.

Appearance

The design is super basic, but it’s how I like it. They only have what they need. It’s also easy for anyone marginally proficient with PowerPoint to do so similarly.

Narrative

The only reason I like this deck is that there is a story in it. They have a vision and it doesn’t make me want to barf or roll my eyes.

Structure

There are no slide numbers.

Everything is structured simply and well.

Slides

They touch on but they don’t really get into aspects such as market size, go to market, defensibility etc in detail. They have this vision vibe which is “we will figure everything out because we are already doing cool shite”. I sort of buy into it too. That’s not to say I’m going to dig in more, have meetings, try them out etc. Of course their investors did.

Pitch deck review

The cover is fine. You will notice in the deck there are nods to a lot of nerd culture. The holodeck is obviously from Star Trek and aspirational.

The context is that a tonne of money had gone into VR and all VCs knew that. Rather than trying to ignore a 2000kg elephant in the room, they call BS and say it.

The slide is overly simple, but eh, so is the whole deck. They’re going a vision sell, rather than one based entirely on logic. And frankly, if you are raising money to do VR, well you probably need to.

The vast majority of founders want to gloss over or ignore bad things entirely. The founders made a bold call to totally lean into the negative.

Continuing on the theme of sucking, they explain adoption has been garbage. 120m people could use VR but only 5m headsets have been sold.

VR headsets do suck. I got an Oculus Go a few years back from Christmas and I used it once and never again. Great thought from my parents, but it was a terrible product that made me feel ill and had almost no content.

Normally I want slides to be a little more academic, but with the story they are telling, do they really need to explain in more detail?

This slide is a bit lame. It’s aspirational though and I guess it fits into their story.

The slide is a little ugly. The text looks like a weird raddish. My usual rules don’t apply as much as this deck is very non-normal. They could have explained the disappointment in a few ways, but this is one.

Here we have another pop culture reference. Family Guy crossed with Star Trek in a Holodeck. They’re playing into full-on nerd. The wording plays to that too. This really won’t work for most startups.

This is a very aspirational slide without having to say it.

It’s impossible to know but these are photos from two of their locations. The slide is a bit eh, but there is a story.

The narrative sort of continues on that they’ve made AAA games in ‘your neighborhood’. There are 3 examples. They make very little effort to really prove anything. The slides are a statement of fact you have to buy into and check.

It’s really simple to want to just flick past this slide. The point is about the games being social. I imagine it is to get users to share on social networks to drive user adoption. There is this element they are selling around being fun to watch. It’s not terribly obvious.

On a small scale what they are doing is already working well. They’re the top activity in HK and SG. And if you have 1000+ reviews on anything with a 5.0 you’re doing well.

I don’t like superlatives like “blown away” but there you go.

The font is a little small, but the slides are consistently structured well.

Note that the slides link together well. People love the product and this is linked to their demand.

If you look at the chart, the growth looks lame. It’s actually cool as that flat line is in fact near 100% occupancy. They should call that out on the slide.

Cool, they are using sub-headers now. Sub-headers are a great place to add commentary to the body of the slide. Ok, they do mention only having one location for 8 months. Feel like that would have been a useful notation.

So to tie everything up they are getting into unit economics. We can’t see the numbers, but I presume they are strong.

Unit economics are great if you have them… hopefully.

Note the slides link together again. The unit economics help them facilitate growth, which is starting to sound like a flywheel.

I don’t know about this slide. Sure, demand has enabled them to open more locations.

Ok one thing to notice is the legend is absolutely tiny. I had to strain to notice that the red line is the number of rooms that they have.

Slide flows again here, with growth enabling them to make content. I don’t know what revenue for studio partners means? Is this a revenue share?

They should use the subheader to explain. I feel the deck is very much designed to be talked to.

As I thought, here we have a fly wheel that links the slides together. They could have started with this and shown how it all ties then broken it down, but it’s nitpicking. Normally you would explain each of the parts of the flywheel, but really this is a summary of the previous slides, highlighting there is a link between it all.

My guess is that they started with the notion of communicating a flywheel and then build the deck around those 4 points.

They’re raised and are raising money. I’m not sure how bootstrapping applies here.

They are constantly selling the dream in the deck. A new medium is the aspiration.

Don’t put in interstitial slides. They are annoying.

Timing slides are important and very hard to do well.

The core question investors have is why now. Why not 5 years ago? why not in 3 years’ time? It is a fair question.

If you are doing a startup based on hard tech and software then you will need a real reason. There is a tonne of startups that failed because the timing was not right.

Stating the time is right because “this is all just barely possible” is absolutely correct. They break out 4 technical aspects which are pertinent which is about as well as you can explain things.

This is the first slide which I don’t understand what the point is? So, retailers need to draw people back to them? And secondly, Americans want to buy experiences?

I would have two charts, with the new one proving retailers need experiences and have a proper header above it. There is no source for experience spend.

The deck is interesting because the founders call bullshite. If you watch the video one of the founders says they told Andrew “we told you why you should not invest!” I’ve noticed that some smart founders literally tell investors to talk them out of what they are doing. All startups have risk factors and investors know that. Why not bring them up and discuss them? That way you have some control over the narrative.

They are setting up physical bases. This is not scaleable like software. This means it is a ‘capital intensive’ business and that makes things go flacid fast. Why? Becaause capital intensive startups are harder and more expensive to scale.

The founders attempt to preempt by saying they need to be the most scaleable. Their x-axis puts them explicitly in a scaleable box. Without seeing the other companies, it’s hard to see if this is true. Small point, but immersiveness is a subjective point.

I don’t like people trumping horns. Let investors decide. The slide is solid. I don’t like paragraphs. Use bullet points and cut every word with a scalpel.

The big vision is in every neighborhood. They mention on slide 4 that they put one in a neighborhood, so they want them everywhere.

Why not. I hate the vision stuff, but this is a solid goal. I mean, why not? I’d try it.

Note it beats the shite out of writing “thanks” on a slide.

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