South Korean startup Kakao Entertainment announced today it has acquired Wuxiaworld, an Asia fantasy fiction platform, via its serialized fiction app subsidiary Radish to bolster the mobile storytelling business. The transaction size is $37.5 million.
Wuxiaworld, which has grown through word-of-mouth, claims it is now the largest English-language Asia fantasy platform in the U.S. in terms of the number of users. The fans have translated more than a hundred thousand Chinese and Korean fiction chapters into English. Approximately 30% of its users are from the U.S and Canada, while 30% and 20% are from Southeast Asia and Europe. The rest are scattered across the globe.
The announcement comes nearly seven months after Kakao Entertainment’s two U.S-based storytelling platform acquisitions, Radish and Tapas Media.
Wuxiaworld was founded in 2014 by Jingping (JP) Lai, a former American diplomat and passionate fan of Chinese fantasy martial arts novels, or Wuxia, who started translating Chinese martial arts fiction into English out of his love for these works. Wuxiaworld does not have physical offices, although it is headquartered in Hong Kong, Lai said. It will continue operating 100% work-from-home as it has been since its founding, with founder Lai remaining CEO of the Asia fantasy storytelling platform, Lai told TechCrunch.
Wuxiaworld expects to launch more content in its platform with Kakao Entertainment’s broad access to the best original stories and intellectual properties in Korea’s fast-growing online serial fiction market and Radish’s strong marketing team (in the U.S.), Lai said. Wuxiaworld also has partnerships with Chinese digital publishers that can create additional synergies.
Wuxiaworld has millions of page views daily in over 100 countries via its website and app with a majority male audience. In contrast, Radish’s audience is primarily female-driven, which perfectly complements to diversifying Kakao Entertainment’s web fiction portfolio in the U.S. market, according to its statement.
“Wuxiaworld is a truly gem of a company. Supported by strong word-of-mouth and an active community, 85% of Wuxiaworld’s total revenue comes through content purchased by a monthly subscription model. The company continues to grow impressively, with annual year-over-year profit growth of up to 40%,” said global strategy officer of Kakao Entertainment and CEO of Radish and Seungyoon Lee, who led the acquisition of Wuxiworld.
Image Credits: Kakao Entertainment/ Radish/ Wuxiaworld
Wuxiaworld’s subscription system allows users to read ongoing episodes free, but all completed episodes are paywalled. It also offers a monthly ad-free subscription model that enables users to read various completed series for free each month and a novel-specific sponsorship program that lets readers access the next chapters of ongoing episodes.
Kakao Entertainment’s popular martial arts and fantasy fiction contents such as “The Second Coming of Gluttony” and “Overgeared” already account for approximately 5% of the Wuxiaworld library among the top-grossing intellectual properties, driving almost a quarter of its revenue.
“Both companies [Kakao Entertainment and Radish] are committed to creating high-quality mobile fiction, which forms the basis for their strong market leadership in the U.S. and Korea,” Lai said.
Kakao Entertainment, which owns a slew of collections of Korean web fiction, will accelerate its business growth in English-speaking markets with Radish’s expertise in delivering mobile novels to U.S. consumers and Wuxiaworld’s commitment to translation excellence, as per its statement.
“Radish and Kakao Entertainment hopes to further realize Wuxiaworld’s infinite growth potential to reach a new and wider demographic in the U.S. market,” Lee said.
Following the acquisition, Kakao Entertainment now has three storytelling platforms: Radish, Tapas and Wuxiaworld. Having launched across Asia and Europe this year, the company plans to expand further in international markets next year, aiming to triple its transaction from overseas in the next three years. Kakao Entertainment announced last week its webtoon service launch in France as early as this month.
Kakao Entertainment opened offices in Thailand and Taiwan earlier this year. It also entered Indonesia in 2017 and Indian in 2020. Its sister company Piccoma, formerly known as Kakao Japan, provides web cartoons and novels in Japan.
South Korea’s two largest internet giants Kakao and Naver compete in the storytelling platform market. In May, Naver has also completed an acquisition of Wattpad, a Canada-based web novel platform.