South Korean online gaming giant Krafton, controlled by billionaire Chang Byung-gyu, has invested 120 billion won ($89.6 million) in Spoon Labs, a Seoul-based company that operates a short-form K-drama streaming platform.
Krafton, which develops the popular PlayerUnknown’s Battlegrounds (PUBG) videogame, said on Wednesday that the investment marks its largest in a non-gaming company. In a statement, Krafton said it decided to back Spoon Labs after seeing the growth potential of short-form dramas, the opportunity to secure new intellectual property and the “synergy with existing businesses,” without elaborating.
Founded in 2013 by former LG Electronics research engineer Neil Choi, Spoon Labs started out as an audio social networking platform targeting Gen Zs. Named Spoon, the online platform allows users to communicate with each other via audio, similar to the Andreessen Horowitz-backed U.S. live audio chat app Clubhouse. It’s been launched in Korea, followed by Japan, the Middle East, North Africa, the U.S. and Taiwan. Spoon Labs said it posted a record high revenue of more than 25 billion won in the first half of 2024, with more than 60% of it coming from overseas markets. It recorded a revenue of 45.5 billion won and a net income of 5.6 billion won in 2023, according to regulatory filings.
Spoon Labs in July ventured into video streaming, launching an app for bite-sized K-dramas, with each episode lasting about two minutes. The platform, called Vigloo, has so far released 60 drama series across various genres from romance, thriller to science fiction. It supports seven languages, including English, Chinese, Indonesian, Japanese, Korean, Spanish and Thai.
Spoon Labs plans to double the number of drama series by the end of the year, according to Krafton’s statement. The company will also ramp up marketing efforts in the U.S. and Japan, with the release of Japanese drama series.
“Spoon Labs has already proven its solid overseas business capabilities through Spoon over the past few years,” Krafton CEO Kim Chang-han said in the statement. “We hope that in the newly launched short-form drama platform business, they will discover entertainment that people around the world can enjoy together and also create an industry ecosystem.”
Spoon Labs’ most recent financing was in 2019, when it raised 45 billion won in a Series C round from investors including Korean billionaire Lee Hae-jin’s Naver, the country’s largest internet company by market cap; IMM Investment, which has backed Krafton and billionaire Bom Kim’s e-commerce giant Coupang; and KB investment, whose portfolio includes tycoon Song Chi-hyung’s crypto exchange Dunamu and billionaire Lee Dong-chae’s battery materials manufacturer EcoPro BM. The round valued Spoon Labs at 300 billion won, according to local media reports. The company has also attracted the likes of SoftBank, as well as Altos Ventures and Goodwater Capital, both early investors of Coupang, among others.
Krafton’s investment in Spoon Labs comes as the online gaming behemoth is trying to diversify its revenue stream after years of heavy dependence on its blockbuster PUBG game. The Korea-listed company last month acquired Tokyo-based Tango Gameworks for an undisclosed amount. Tango Gameworks was among the 27 companies Krafton has invested since 2021 in an effort to expand its game portfolio.
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