Japanese billionaire Masayoshi Son’s SoftBank is investing $150 million in Asia’s busiest metaverse platform, the nascent but sizzling virtual world where people work and play through avatars.
SoftBank’s Vision Fund 2 made its investment in metaverse platform Zepeto, operated by Naver Z, a unit of Korean billionaire Lee Hae-jin’s internet giant Naver, according to media reports. The investment values three-year-old Zepeto at more than $1 billion, according to the Wall Street Journal. Zepeto’s other investors include Korean billionaire Bang Si-hyuk’s HYBE, which manages K-pop boy band BTS.
The Japanese tech investment giant invested in Zepeto because of the company’s large following, says Rajiv Biswas, Asia-Pacific chief economist with research firm IHS Markit. Zepeto has about 2 million active users a day, making it Asia’s busiest metaverse platform with about 2 million active users a day, according to the Wall Street Journal report. Market research firm Sensor Tower says Zepeto was downloaded 400,000 times in July this year alone.
“This is an investment in the future of the internet and a prayer for a strong position in the precipice of Web3, which may reach quadrillions in value,” says Sean Su, an independent tech sector analyst in Taiwan, referring to a decentralized online ecosystem based on the blockchain.
“Major companies are now engaged in a race to define the standard for virtual environments, or metaverses, and firms like SoftBank are vying for an early lead,” Su says. “All this is a huge market that any corporation with a long-term strategy would love to dominate.”
SoftBank, Su adds, hopes to hold a place for itself among the next generation of consumers, he says. The Vision Fund 2 had already led a $93 million funding round for the Sandbox, a Hong Kong-based blockchain gaming platform.
Korean billionaire Kim Beom-su’s internet giant Kakao as well as fashion labels Ralph Lauren and Gucci have worked with Zepeto, where users can buy and wear virtual fashion items and meet celebrities in virtual spaces, to drive their businesses. According to the Wall Street Journal report, about 70% of Zepeto’s users are female and between the ages of 13 and 24. on Zepeto.
“Zepeto has a large Gen Z and Gen A following in South Korea, which has made it a focus for digital advertising by Korean and international fashion brands,” Biswas says.