Kakao Entertainment, a unit of the Korean internet giant Kakao, has acquired Radish, a mobile fiction platform backed by Softbank Ventures Asia, in a $440 million transaction. The South Korean entertainment firm is also acquiring US-based online comic app Tapas for $510 million, Reuters reported.
The acquisition of Radish will strengthen Kakao Entertainment’s global webtoons and web novel business and expand its reach in North America and other English-speaking territories, Softbank Ventures Asia said in a statement on Tuesday. Meanwhile, Tapas’ strength in “webtoons” led to a five-fold jump in sales in 2020, Kakao said.
Softbank Ventures Asia, along with Kakao Page, had led a $63.2 million Series A funding round in Radish in August last year. Radish’s original investors include Lowercase Capital, K50 Ventures, billionaire investor Nicolas Berggruen, former Microsoft executive Charlie Songhurst, BDA Chairman Duncan Clark as well as the bestselling author Amy Tan.
Founded in 2016, Radish is a Netflix of sorts for reading. Its stories are serialised and published in bite-sized installments for reading on a smartphone. Readers can access thousands of serials across genres for a fee and also connect directly with their favorite storytellers in live community chat rooms.
Authors can publish their own original stories, revive backlist titles with a mobile readership, and pre-release upcoming books.
The company claims that it experienced explosive growth following a strategic move in 2018 to begin producing in-house “Radish Original” series alongside curated content. In 2020, revenues grew over 10 times, compared with the previous year.
“We see even greater growth potential. Radish has found enormous success with fast-paced, original mobile content and undergone dramatic growth with a ten-fold increase in annual revenue last year,” said Jinsoo Lee, CEO of Kakao Entertainment. “Combining Kakao’s expertise in the IP business and Radish’s strong North American foothold, we are excited about what we can achieve together,” he added.
After the acquisition, the company will maintain management autonomy and continue to operate under the Radish brand. In addition to continuing to helm the company, founder and CEO Seungyoon Lee will serve as the global strategy officer of Kakao Entertainment.
Kakao Entertainment operates mobile content platforms in Korea, providing users access to over 80,000 IPs, including the most extensive library of original content in the country. It has a presence in Japan, North America, Greater China, Southeast Asia, and India.
In April, Kakao Corporation acquired Croquis, the operator of fashion shopping platform ZigZag, for an undisclosed amount. The plan is to spin off Kakao’s style business division from its subsidiary Kakao Commerce and then merge it with Croquis.
Kakao Entertainment is planning an IPO on the Korean exchange and also looking at New York as a secondary listing location, its chief executive Lee Jinsoo told Bloomberg last month. A float could value the company at more than 20 trillion won ($17.8 billion), the CEO had said at the time.