Speaker 1: Welcome to Strictly Business, Variety's weekly podcasts featuring conversations with
Speaker 1: industry leaders about the business of media and entertainment Today.
Speaker 1: My guests are movers and shakers in the world of webtuns.
Speaker 1: What is a webtoon? You ask, well, keep listening, But
Speaker 1: in Hollywood shorthand, it's like a graphic novel meets a
Speaker 1: blog scroll meets a soap opera. David J. Lee is
Speaker 1: chief operating Officer and chief financial Officer of Webtoon Entertainment.
Speaker 1: The Los Angeles based company is a big force in
Speaker 1: this growing digital storytelling medium that got its start about
Speaker 1: a decade ago in South Korea. My conversation with Lee
Speaker 1: was held January eighth as part of Variety's annual Entertainment
Speaker 1: Summit at the Consumer Electronics Show in Las Vegas. A
Speaker 1: week later, I got on a zoom with the top
Speaker 1: webtune creator Brandon Chen to get his perspective on this
Speaker 1: cutting edge new format. My conversation with Webtoon Entertainments David
Speaker 1: jay Lee is coming up right after this break, and
Speaker 1: we're back with a conversation from cees with Webtoon Entertainments.
Speaker 1: David jay Lee, let's start a little bit and just
Speaker 1: unpack exactly what a webtune is. The best sort of
Speaker 1: the best shorthand description. Hollywood always loves it's this meets
Speaker 1: this plus this, But the best sort of shorthand description
Speaker 1: of what an actual web tune is is sort of
Speaker 1: a mix between a blog and a manga. That might
Speaker 1: be a little oversimplified, But David, if we could start
Speaker 1: just by really sort of sketching out what when people
Speaker 1: go to webtoon users online, because it's a digital platform
Speaker 1: in terms of the core of the of the business
Speaker 1: and the storytelling, when somebody goes to a find a webtune,
Speaker 1: what user experience is that?
Speaker 2: Yeah, it's a great question. And for those in the
Speaker 2: audience who may not have heard of webtune, I have
Speaker 2: the feeling you may have seen a great live action
Speaker 2: film and didn't realize it came from us. And if
Speaker 2: you have friends and family who are in our core target,
Speaker 2: which is the gen Z target, I know that they're
Speaker 2: familiar with us. Let me explain what the company is,
Speaker 2: but then explain what the experience is. So Webtune is
Speaker 2: a company, is global. We've got one hundred and seventy
Speaker 2: million monthly active users, but We have twenty four million
Speaker 2: creators who are creating over one hundred and twenty thousand
Speaker 2: stories every day right new there for the taking by
Speaker 2: our gen Z consumers, and the experience is truly digital
Speaker 2: and mobile, and it spans way beyond one genre. It's
Speaker 2: more than manga. It's any genre you can imagine. Imagine
Speaker 2: a gen Z consumer in their palm of their hand
Speaker 2: on a mobile device, with a flick of their fingers,
Speaker 2: can scroll and in a fraction of a moment see
Speaker 2: just enough imagery a few words to tell them where
Speaker 2: a story is going. And at the same time, these
Speaker 2: consumers are spending once they find their great story, thirty
Speaker 2: to sixteen minutes a day reading either a web novel
Speaker 2: or what we call a webcomic or a web tune.
Speaker 2: For me, having started in the advertising business, it reminds
Speaker 2: me of a incredible next generation of a digital storyboard,
Speaker 2: which is why we love the one point three billion
Speaker 2: and reported revenue we generate on our platform. But we
Speaker 2: love the consumers get to see these stories as rich
Speaker 2: film adaptations on Netflix or Amazon Prime where you saw
Speaker 2: one that came out recently after Thanksgiving on TB And
Speaker 2: so we're a great untold story. People don't realize they've
Speaker 2: seen our stories. And you know, I'd love to unpack
Speaker 2: a little bit about what we're all about here.
Speaker 1: Absolutely yeah, I think. I mean, you had the audience
Speaker 1: at twenty four million. That is an astounding number. How
Speaker 1: do you even Before we talk about sort of adapting
Speaker 1: into other media, I want to talk just the mechanics
Speaker 1: of sort of how it works. It's user generated, so
Speaker 1: people can upload their they upload their imagery, they upload Now,
Speaker 1: in my understanding of it, it's largely kind of in
Speaker 1: you know, comp graphic form, comic book form. But are
Speaker 1: you finding now people are uploading video as well with
Speaker 1: their with their web tunes?
Speaker 2: Well what they're they're starting to upload if you think
Speaker 2: about it, these twenty four million creators, the vast majority
Speaker 2: have full time jobs. You know. A great example is
Speaker 2: a young woman named Rachel Smythe who was a brilliant
Speaker 2: graphic designer who thought she might have a story to
Speaker 2: tell in New Zealand and she can come to our site.
Speaker 2: She did. It's called Canvas. We've worked really hard as
Speaker 2: a tech and an AI company to make it easy
Speaker 2: for anyone who thinks they might have a story that
Speaker 2: someone wants to see to create that story, either as
Speaker 2: a web novel or or if they have a sense
Speaker 2: of imagery, what we call a webcomic. And so these
Speaker 2: are if you think about our product, just like you
Speaker 2: can imagine going through a digital storyboard. You can scroll
Speaker 2: through vertically this unique format and see where these stories
Speaker 2: are going. In the case of Rachel, she like many
Speaker 2: of our twenty four million creators, didn't realize that her
Speaker 2: story would allow her to be a global creator. She
Speaker 2: is a New York Times bestselling author in print, which
Speaker 2: we helped her enable. And we may be the only
Speaker 2: company that has shared two point eight billion dollars as
Speaker 2: a core function of our business model with creators. That's
Speaker 2: why we have so many, because we're truly aligned to
Speaker 2: the fact that consumers want new stories, they want stories
Speaker 2: from unexpected global sources, and entertainment companies want proven, validated
Speaker 2: with market signal hits that come from places like us
Speaker 2: for them to turn into great pieces of film or
Speaker 2: merchandise or games. So that's the reason why I think
Speaker 2: we have this unique ecosystem of a global consumption on
Speaker 2: our platform, these one hundred and seventy million monthly active users,
Speaker 2: a format that allows anybody to be able to see
Speaker 2: in a fraction of a second where a story is going,
Speaker 2: and a d risked profile for an evergreen source of stories,
Speaker 2: I hope increasingly for the media industry, which we're going
Speaker 2: to talk about more today.
Speaker 1: I mean, you know, there's just no shortage of interest.
Speaker 1: You know, from the beginnings of Hollywood to today. The
Speaker 1: story the kernel. It starts with the story. It's a cliche,
Speaker 1: it starts on the page, but it's it starts with
Speaker 1: the story. And what's interesting in the modern age is
Speaker 1: that so many people are empowered as storytellers. I think
Speaker 1: in the past people felt like, well, I'm not a
Speaker 1: Hollywood screenwriter. I'm not, you know, but this is like
Speaker 1: a forum like so many other social media platforms are.
Speaker 1: But it's such a specific forum. Let me ask us
Speaker 1: again a few more questions about the mechanics of the
Speaker 1: core web tune business. Does your company do you curate
Speaker 1: some of these? Do you see when things start to
Speaker 1: bubble up you curate them and help kind of recommend
Speaker 1: them or is it really.
Speaker 2: Yeah, I think they're think of the experiences. We're very
Speaker 2: much empowering creators, as you mentioned, to be able to
Speaker 2: present the story in a way that everyone can consume.
Speaker 2: So a bunch of our technology, for example here in
Speaker 2: the US we call it canvas, allows a great amateur
Speaker 2: creator to see if somebody might love their story as
Speaker 2: a webcomic or on our wapat platform or web novel.
Speaker 2: But then with one hundred and over one hundred and
Speaker 2: twenty thousand stories arriving every single day, a lot of
Speaker 2: our AI technology is to make sure that as a consumer,
Speaker 2: these gen Z consumers, they want an unexpected story, but
Speaker 2: they have to find it. So having AI based personalization
Speaker 2: engines to allow we call her Mattie as our target consumer.
Speaker 2: You know, she's maybe just out of college, or maybe
Speaker 2: she's getting a cup of coffee, and Mattie loves the
Speaker 2: story that she's reading. But we know so much about
Speaker 2: what she loves that presenting her the ability to see
Speaker 2: the next story is a big part of our underlying technology.
Speaker 2: And then there's a large amount of this also which
Speaker 2: is geared around ensuring that we protect both the creator
Speaker 2: and the consumer to ensure that the content is safe.
Speaker 2: But also we all as content generations generators, fight piracy.
Speaker 2: So a large amount of our tech is to make
Speaker 2: this ecosystem healthy and because we're global, that's required us
Speaker 2: to be a tech company at origin, which we were
Speaker 2: bored out of, a global tech company, but a media
Speaker 2: and entertainment company in reality as now that we're generating.
Speaker 2: We have over nine hundred adaptations of stories outside our platform,
Speaker 2: one hundred of which are rich film releases in TV
Speaker 2: and movies. You know, two of Netflix's all time top
Speaker 2: ten projects ever came from us, right, what are those titles? Yes,
Speaker 2: so all of Us are Dead was one of them.
Speaker 2: And Through My Window, which was an unex affected web
Speaker 2: novel that came out of the Spanish and language creators,
Speaker 2: was amazing. But you know, every quarter this happens, right,
Speaker 2: Love Me, Love Me in Italy, you know, seeking me
Speaker 2: votes from Spain. We talked about last quarter Sideline, the
Speaker 2: Quarterback and Me. The day after Thanksgiving here in the
Speaker 2: US was a top five hit on two B which
Speaker 2: start no a back this great social media star. So
Speaker 2: more and more, I think the world is waking up
Speaker 2: to the fact that people love a good story, and
Speaker 2: they love it in all formats on our platform, as
Speaker 2: a webcomic or a web novel, but certainly as a
Speaker 2: rich film release, a live action release on either TV
Speaker 2: or on the big screen.
Speaker 1: How do you with over one hundred thousand stories coming in?
Speaker 1: Did you say every day?
Speaker 2: Every day?
Speaker 1: I can't even imagine, you know, the ranks of studio
Speaker 1: executives that it would take to process that. How do
Speaker 1: you deal with content moderation? I got to believe that
Speaker 1: not every one of those people are good citizens. And
Speaker 1: you know, maybe there's some stuff that you don't want
Speaker 1: on the platform. Do you reserve the right to say, hey,
Speaker 1: this isn't right for web tune?
Speaker 2: I mean, this is where our technology comes into play.
Speaker 2: I used to be in businesses in mobile gaming and
Speaker 2: other consumer businesses where we were relying on a lot
Speaker 2: of hard work by a lot of humans. But while
Speaker 2: we have that, we have the benefit of cutting edge
Speaker 2: AI technology our own, but we're very happy to partner
Speaker 2: with whoever has the best, and we like to think
Speaker 2: that we provide a real advantage for creators on piracy
Speaker 2: and consumers on safety. But a large part of it
Speaker 2: is also market signal. You know, when you have one
Speaker 2: hundred and seventy million monthly active users across multiple languages
Speaker 2: across the globe, and they are so protective of the
Speaker 2: community that we have, they're a big part of our
Speaker 2: warning system as well. And you know, we can talk
Speaker 2: about all the policies, the technology. We like to think
Speaker 2: we are cutting edge here, but I think the core
Speaker 2: is what's differentiating is the technology we have and the
Speaker 2: community base we have and the track record. You know,
Speaker 2: Protecting creators and consumers has been our story since its origin,
Speaker 2: and it's taken us over ten years to arrive as
Speaker 2: now a public company at scale. But now that we are,
Speaker 2: we can have these one hundred and twenty thousand stories
Speaker 2: that we think are readable and safer consumers arrive every day.
Speaker 1: I could imagine that that with that kind of volume,
Speaker 1: you'd have to have an AI tool, you would have
Speaker 1: to have something so you have certain red flags that
Speaker 1: they're looking for. Not to hammer on this, but you know,
Speaker 1: content moderation is a big subject for us. Let's talk
Speaker 1: about so how does it work with the creators and
Speaker 1: the business model. The more people read, the more it's
Speaker 1: basically a revenue share.
Speaker 2: Yeah, so we share in the success of amateur creators
Speaker 2: as they become superstars. And there are so many examples
Speaker 2: of folks who didn't realize that they had a voice
Speaker 2: that deserve to be heard. Our model, while simple, is
Speaker 2: really hard. You know, it is difficult for a company
Speaker 2: to do what we've done because this to twenty million
Speaker 2: dollars we've shared means that we're in it with them.
Speaker 2: And from a consumer standpoint, you know, we don't force
Speaker 2: heavy subscriptions. You know, Maddie as our gen Z target consumer.
Speaker 2: By the way, over seventy percent of our consumers in
Speaker 2: North America say they can't find the stories they find
Speaker 2: anywhere else. Same percent says that their experience on our
Speaker 2: platform is more fun than great companies like Roadblocks and TikTok.
Speaker 2: And the reason why that's true is Maddie can serve
Speaker 2: her as long as she wants, and when she finds
Speaker 2: a story, it feels like her discovery, a bit like
Speaker 2: discovering a real or a video that she feels no
Speaker 2: one else has seen. She only pays fifteen to seventy
Speaker 2: cents to see the latest breaking episode of the story
Speaker 2: that she picked, and we are patient. We let our
Speaker 2: Maddie's take all the time they want to find the
Speaker 2: story they want, and she doesn't have to always pay.
Speaker 2: She can watch a video, maybe it's an advertisement that's
Speaker 2: akin to the genre. Maybe she's watching true beauty and
Speaker 2: there's a you do a beauty ad that she finds
Speaker 2: relevant that allows her to see that next episode. So
Speaker 2: we make it super easy for our consumers to be
Speaker 2: as empowered as our creators to pick on their own
Speaker 2: time what they want to read and see. And I
Speaker 2: think that's that patience over the last decade plus is
Speaker 2: the reason why we feel gen Z is we're not
Speaker 2: reaching them. They're reaching out to us for stories they
Speaker 2: can't find anywhere.
Speaker 1: That's a good way to put it. Very much so
Speaker 1: with with gen Z, what are the metrics for the
Speaker 1: for the part of the platform that does have advertising
Speaker 1: or some kind of sponsor message, what are the metrics
Speaker 1: that matter? Is it just total clicks? Is it time spent?
Speaker 1: And kind of curious about the intricacies of the business model.
Speaker 2: Yeah, you know, it's a great topic for those who
Speaker 2: are interested in this. A lot of the businesses that
Speaker 2: I've been a part of, you know, you basically canbalize
Speaker 2: your content business if you shove your ad business up.
Speaker 2: You know, I think about my mobile game days where
Speaker 2: I'm pushing gotcha for paid content at the expense of
Speaker 2: time spent on an ad. This is the only business
Speaker 2: I've ever seen where deep engagement helps both sides. Let
Speaker 2: me explain. So first, who's looking at the content matters.
Speaker 2: We like to think we have demographic goal because while
Speaker 2: we got a lot of users, we have users spending
Speaker 2: thirty to sixty minutes per day, and they're the attractive,
Speaker 2: somewhat hard to reach users. This gen Zjen, Alpha and beyond.
Speaker 2: By the way, plenty of fifty year olds like me
Speaker 2: love our content too, because we have every genre a
Speaker 2: creator could imagine on our platform. But then, in addition,
Speaker 2: just as I mentioned, if Maddie or if I are
Speaker 2: not feeling like I want to pay fifteen to seventy cents,
Speaker 2: if I watch an AD and I get to see
Speaker 2: the next episode without having to pay, we know that
Speaker 2: our cohort data suggests once they read more because they
Speaker 2: have more confidence that one of the next one hundred
Speaker 2: and twenty thousand stories could be the one for them.
Speaker 2: This is the only evergreen source of content I've been
Speaker 2: a part of. If you think about every other business,
Speaker 2: I've been a part of the content static. So you're
Speaker 2: either monetizing in ads or you're monetizing and content, but
Speaker 2: that content has a shelf life. Here, I have one
Speaker 2: hundred and twenty thousand stories arriving every day from a
Speaker 2: growing global set of creators, curated and benefited from AI
Speaker 2: and technology. It's the reason why this growing at business,
Speaker 2: and we were really not focused on our advertising business
Speaker 2: until very recently here in North America. We're solely focused
Speaker 2: on our creators and our consumers and content. It's why
Speaker 2: I'm so hopeful that we can actually increase our household
Speaker 2: penetration by offering relevant ads as an alternative for people
Speaker 2: who may not want to pay to see the content
Speaker 2: that that arrives on the platform.
Speaker 1: And when people in the pay model, is it a
Speaker 1: monthly subscription or is it a pay as you read?
Speaker 2: Yeah, so there are two ways, and we like to
Speaker 2: make it super simple. We want Maddie to only have
Speaker 2: to pay a micro payment of fifteen to seventy cents
Speaker 2: for an episode that she wants to read she picks
Speaker 2: by the way. You know, everyone likes this idea of
Speaker 2: having access to a library of content. So this first thing,
Speaker 2: these micropayments for the late breaking episode is called a
Speaker 2: fast pass. And then we have another way, which is
Speaker 2: called a daily pass. So if someone wants to see
Speaker 2: a bunch of content where episodes are not being written
Speaker 2: live every week anymore, because we have an immense library
Speaker 2: of proven hits in our platform, hits from all parts
Speaker 2: of the world. It turns out, by the way gen
Speaker 2: Z likes seeing stories from unexpected sources and from cultures
Speaker 2: and languages that are not their own. It's a wonderful
Speaker 2: consumer trend that we benefit from. So these are the
Speaker 2: two ways. The majority, though, I would say the majority
Speaker 2: of our pay content is when Maddie has pre identified
Speaker 2: it a great story and she knows that the next
Speaker 2: one is coming out in a week or so, and
Speaker 2: she wants to be the first to see it along
Speaker 2: with anybody else. That fast pass is the very simple
Speaker 2: way that we keep the experience fresh.
Speaker 1: That's great. To your point about just you know you
Speaker 1: want to go, you want to take this avenue, Take
Speaker 1: this avenue, Take this avenue. My mom, let me ask
Speaker 1: you do you do you with You can't possibly host that,
Speaker 1: you can't keep things on the platform in forever. Do
Speaker 1: you kind of periodically call through and you know older
Speaker 1: things maybe are not are not either not available or
Speaker 1: not platformed as much. How do you manage the volume?
Speaker 2: Well, we our origin, We are an independent public company
Speaker 2: listed in the summer on Nasdaq, but for years, our
Speaker 2: origin was out of this great company based in Korea
Speaker 2: called Navor, and many of you may not have heard
Speaker 2: of it, but Navor is the Google and Amazon Plus
Speaker 2: of Korea, amazing technology. So because our heritage was tech,
Speaker 2: our ability to manage large amounts of data is the
Speaker 2: core capability of the company. We You know, I can't
Speaker 2: claim to say that we will keep every piece of
Speaker 2: content forever, but we certainly have the capability of bringing
Speaker 2: back content that has been serialized for years. So one
Speaker 2: of the things I wanted to mention is if a
Speaker 2: creator has a great story, this vertical scrolling format means
Speaker 2: that on a weekly basis, they're seeing episodes We've seen
Speaker 2: hit stories span over a decade of life with i'ming new,
Speaker 2: fresh episodes hitting every week. Because by serializing, you continue
Speaker 2: the journey of the storyline versus a static piece of content,
Speaker 2: which has a shelf life that is defined by the
Speaker 2: user experience. And that's why we always try to extend
Speaker 2: the life of the content we have, because we know
Speaker 2: that it can be serialized or brought back as one
Speaker 2: of these great film releases that I've mentioned, and so
Speaker 2: we again, we have a patient headset and we're so
Speaker 2: data driven that we know that stories don't die easily.
Speaker 1: I want to talk about a bit an exciting film
Speaker 1: project that you all have coming up, but I want
Speaker 1: to ask you a question. I think a lot of
Speaker 1: people are probably thinking, who owns the copyright the creator webtune?
Speaker 1: Do you share it?
Speaker 2: Yeah? We want our creators to feel like they own
Speaker 2: their content, but at the same time, we want to
Speaker 2: share and enable their success so much. You know, when
Speaker 2: a young creator is writing in a language and doesn't
Speaker 2: have the resources to know how to present it across
Speaker 2: the world to a global audience in multiple formats and
Speaker 2: multiple languages, that's where we like to think.
Speaker 3: Are you do bring a lot to the table? Yeah?
Speaker 2: And so as a result, generally, when a creator has
Speaker 2: a voice that's clearly being heard, we convert them to
Speaker 2: what's called a professional creator and we voluntarily enter in
Speaker 2: agreement where we generally have distribution rights in our platform,
Speaker 2: but we want them to own their content so that
Speaker 2: if they can be a great Netflix film release, that
Speaker 2: we can do it with them. And you know, we
Speaker 2: have relationships. We want to article that was recently written
Speaker 2: claimed that we may have been the source of over
Speaker 2: half of a major streamer's film releases in a country,
Speaker 2: and you know I can already tell you that, and
Speaker 2: we're going to talk about it increasingly in North America.
Speaker 2: I think twenty twenty five is going to be the
Speaker 2: year where, now that you know that we're the source
Speaker 2: of these stories, you're going to see more and more
Speaker 2: of our great platform stories arrive as live action films,
Speaker 2: either on TV or on the big screen. One of
Speaker 2: which we're going to talk about for the first.
Speaker 1: Time, got a pretty cool partner lined up in Margo
Speaker 1: Roby and her Lucky Chap Productions is developing a property.
Speaker 1: Tell us about it.
Speaker 2: Yeah, we're excited as a feature film. I mean, listen,
Speaker 2: I want to make sure we're clear. We're excited about
Speaker 2: all the live action films that are going to come
Speaker 2: out in the next few months. But one that's particularly
Speaker 2: interesting is stack Town. Stacktown started as a horror webcomics
Speaker 2: story had over eighteen million views. It's the story of
Speaker 2: three protagonists that arrive in Stacktown, and you'll have to
Speaker 2: watch it to see the rest. Read it on our platform.
Speaker 2: But partnering with Lucky Chap, Margo Roby's production company and
Speaker 2: their notable success with Barbie.
Speaker 1: And the other little movie we heard about last year.
Speaker 2: Yeah, I think it goes to show that our stories
Speaker 2: can live in any format, and it goes to show
Speaker 2: that our creators have the ability not just to be
Speaker 2: very successful in our platform, but that we're really aligned
Speaker 2: to that creator's success now as a live action release.
Speaker 1: I gotta believe. I just still can't get over this
Speaker 1: creator database. I gotta believe every literary agent in Hollywood,
Speaker 1: the smart ones are calling through your platform on a
Speaker 1: daily I wish.
Speaker 2: I think our almost maniacal focus on our platform, more
Speaker 2: and more creators, more and more consumers, more and more content,
Speaker 2: has meant that the upside I think we see in
Speaker 2: advertising and the upside and crossover ips just what we
Speaker 2: call these books that we're enabling, these films, these video
Speaker 2: games and merch we're just getting going. In fact, in
Speaker 2: North America, our web team Watpad Studio is really only
Speaker 2: less than two years old. We have a great studio
Speaker 2: called Studio en based in Asia that has been further along,
Speaker 2: which is why so many more consumers in Asia know
Speaker 2: about the films that originate on our platform. I think
Speaker 2: it's an exciting time, because I would love, you know,
Speaker 2: in the next few years for every literary agent or
Speaker 2: anybody else to be scrolling with us through our stories
Speaker 2: because you know, we have proven data around these digital
Speaker 2: storylines that we know resonate and we know who loves
Speaker 2: them across the globe. So I'm very hopeful that we'll
Speaker 2: have a bigger presence outside of our platform.
Speaker 1: Do you ever if something is really strong and has
Speaker 1: a has a you know, volume, do you ever create
Speaker 1: like dedicated ebooks around because that would seem like you
Speaker 1: could do that pretty easily.
Speaker 2: Yeah, we're just beginning to explore it. You know, we
Speaker 2: now have as reported, over five hundred million dollars of
Speaker 2: capital in the bank and going public in the last
Speaker 2: couple of courses, we generate positive operating cash flow, so.
Speaker 1: Your phone is going to ring so much.
Speaker 2: Well, we finally have that balan shaping that number out
Speaker 2: there to be able to consider in a very careful
Speaker 2: prudent way, using our own capital to speed up adoption.
Speaker 2: The good news for US is I think this organic
Speaker 2: adoption here in North America and in Europe where we're
Speaker 2: just getting going, is happening without heavy investment. But I
Speaker 2: certainly am interested in finding interesting creative ways to speed
Speaker 2: up how creators can present more stories to consumers here.
Speaker 1: And very little, very little off you know what you'd
Speaker 1: call off air marketing. I mean, it's been such a
Speaker 1: word of mouth business. It seems like are there markets
Speaker 1: or regions where you do any kind of advertising or
Speaker 1: marketing push?
Speaker 2: Well, in North America, we've just begun to partner with
Speaker 2: other great companies. So for example, one that I thought
Speaker 2: was interesting is we partnered with a company called Duelingo,
Speaker 2: who shares this great global gen z engaged audience in
Speaker 2: a very different way. I mean, these are folks interested
Speaker 2: in learning about new cultures and languages, and we partnered
Speaker 2: with their duo of their iconic owl. And what I
Speaker 2: loved about it is we created new content. We created
Speaker 2: a series of new stories on our platform in collaboration
Speaker 2: with Duelingo. We saw over seven million views of this content.
Speaker 2: It was a very authentic way for us to leverage
Speaker 2: the fact that we have the same engaged audience that
Speaker 2: they do. But instead of it being you know, a
Speaker 2: paid marketing deal only, it was more authentically about creating
Speaker 2: content that people were enjoying. You're going to see us
Speaker 2: do more and more of that. We recently did a
Speaker 2: deal with Discord that I thought was also similar and
Speaker 2: that we share growth amongst this attractive young audience who
Speaker 2: want to be picking content on their own terms and
Speaker 2: so doing deals like that, or frankly seeing movies that
Speaker 2: you didn't realize from a fandom standpoint came from us,
Speaker 2: and you're curious about what else did that creator write,
Speaker 2: what other permutation of story occurred. I think that's a
Speaker 2: great way to or more organically drive adoption amongst we
Speaker 2: only have like sub five percent household penetration. In other
Speaker 2: countries we're fifty percent. So the largest market here is
Speaker 2: the market with the greatest growth opportunity for us. So
Speaker 2: you may see us, as I mentioned, using very prudently
Speaker 2: some of our balance sheet to speed up what has
Speaker 2: been largely organic in our spend on marketing.
Speaker 1: Are you in the market for you know, additional content assets,
Speaker 1: production capabilities, or other forms of you know, creative elements
Speaker 1: that could come into it.
Speaker 2: We are, I mean, the company has a history of
Speaker 2: very prudently using acquisition as a way to One of
Speaker 2: the great examples is our webcomic platform in Japan. Is
Speaker 2: last quarter was the number one consumer app in Japan,
Speaker 2: including mobile games. It's called Lii, manga and pan. But
Speaker 2: it's our business and it was you know, we call
Speaker 2: it the rocket ship business. It was built off of
Speaker 2: an acquisition we made of a company called Ebooks Japan,
Speaker 2: so that was the launch pad business. So there are
Speaker 2: examples geographically or maybe to complement our existing capability where
Speaker 2: we're not going to be shy. Having public currency as
Speaker 2: a newly listed public company, I think gives us another
Speaker 2: tool to be able to consider acquisition. But at the
Speaker 2: same time, you know, in our S one and when
Speaker 2: I talked to our investors, we haven't talked about inorganic
Speaker 2: M and A as being required for our growth. It's
Speaker 2: very much opportunistic.
Speaker 1: You don't need to go acquire market share, you.
Speaker 2: But we're very open to it and have a pretty
Speaker 2: good history in doing it.
Speaker 1: David, before you can't, I know you've worked in various
Speaker 1: pockets of media, but you've also worked for companies like
Speaker 1: best Buy and David helped bring us the Impossible Burger.
Speaker 1: What does your back in public companies and companies that
Speaker 1: have worked in very different retail, you know, different sectors
Speaker 1: different from media and entertainment. How does that inform your
Speaker 1: leadership of Webtune, which is a very innovative company.
Speaker 2: That's a hard question answer. I think the oddity in
Speaker 2: my background is there's only been one common theme, which
Speaker 2: is I tend to enjoy working on companies where the
Speaker 2: consumer is looking for something different and technology is finally
Speaker 2: enabling it. So in the past it's been large companies
Speaker 2: like turning around best Buy or del Monti or Zinga.
Speaker 2: More recently, startups like you know, launching a plant based
Speaker 2: burger at Impossible Foods. What I love about web Tune
Speaker 2: is that it's a business that I feel is a
Speaker 2: combination of consumers wanting great stories globally. It's using AI
Speaker 2: to promote human creativity, not talking about the darkness of
Speaker 2: it replacing humans. And I feel good that my gen
Speaker 2: Z kids are reading it, you know, like having them
Speaker 2: feel like they could be an author and a creator
Speaker 2: and having them pick content that I think is appropriate
Speaker 2: for them to choose and read and engage and talk
Speaker 2: about it. For me, I hope it's the last job
Speaker 2: I ever have. We'll see. I came out of public
Speaker 2: company retirement. Like I said, I would not work for
Speaker 2: another public company five years ago when I was launching
Speaker 2: the Impossible Burger and here I am. So for me,
Speaker 2: this is special. This is a different kind of company.
Speaker 1: Don't go anywhere. We'll hear next from Brandon Chen, a
Speaker 1: top creator of webtoons. After this break, and we're back
Speaker 1: with my conversation with Brandon Chen. He's a prolific creator
Speaker 1: of webtoons and digital novels. He's known for popular series
Speaker 1: such as Just a Goblin, among many others. He's based
Speaker 1: in New York, but his work travels the world, and yes,
Speaker 1: he has his eye on growth through trans media. As
Speaker 1: he explains, I will just start at the beginning, Brandon,
Speaker 1: how did you get into becoming a creator for web tunes?
Speaker 4: Yeah, so I started off as a novelist when I
Speaker 4: was from the ages of fourteen. I published my first
Speaker 4: novel from fourteen to seventeen, and then I continued doing
Speaker 4: novels until I was in my early twenties. I think
Speaker 4: at the time it was really hard for me to
Speaker 4: do what I really wanted, which was Japanese manga. I'd
Speaker 4: been obsessed with mangas ever since I was a kid,
Speaker 4: and that was not really a medium that was possible
Speaker 4: in the United States.
Speaker 3: And so how I fell into the web tune space.
Speaker 4: Was you know, I read web tunes actually when I
Speaker 4: was in high school, and I knew about the medium.
Speaker 4: At the time, it was a very Korean dominated medium,
Speaker 4: not as many creators here in the US. But over time,
Speaker 4: obviously that's changed. And I won a competition in Japan
Speaker 4: or had a very viral submission that's was actually for
Speaker 4: Japanese manga. But then I got a web tune publisher
Speaker 4: that gave me a serialization deal out of that competition,
Speaker 4: and from that publisher, then web Tune saw that project
Speaker 4: and wanted to receive a pitch or two and then
Speaker 4: from there I started just a Goblin and samay No
Speaker 4: tourre at Webtune and then you know, that's obviously ballooned
Speaker 4: into a much bigger partnership beyond that. But yeah, that's
Speaker 4: how I got started. It started off with a love
Speaker 4: for Japanese manga and then pivoted over into web tunes.
Speaker 1: Amazing. So wait, now at fourteen were were you publishing
Speaker 1: your novels online? How did you how did you publish initially?
Speaker 1: Do that initial publication?
Speaker 4: Yeah, so when I was fourteen years old was when
Speaker 4: I started the novel. So I was just publishing chapters
Speaker 4: kind of like in a web normal web novel format
Speaker 4: on Whatpad, which at the time had a lot of.
Speaker 3: Different stories on there.
Speaker 4: And you know, I had like I was like fourteen,
Speaker 4: I got like one hundred thousand reads and I was like,
Speaker 4: this is the best day of my life. And then,
Speaker 4: you know, obviously I took that and that the reader
Speaker 4: feedback and packaged into a novel which was distributed on
Speaker 4: on Amazon for ebook and print, and then I could
Speaker 4: just kind of continued that that process of producing novels,
Speaker 4: learning how to storytell along the way, and then eventually,
Speaker 4: like again, pivoted over into more of a visual storytelling
Speaker 4: space after I had a project in Western Comics which
Speaker 4: taught me how to work collaboratively, collaboratively with with artists,
Speaker 4: and then you know, the rest is is history.
Speaker 3: Wow.
Speaker 1: Well, I mean that's right there. There's a lot. You're
Speaker 1: very industrious teenager right from the get go. What what
Speaker 1: is it? Would you say? What is the what is
Speaker 1: the sort of classic characteristic of a web tune something
Speaker 1: published in that format? What makes it different from a
Speaker 1: novel or a graph or a manga or you know,
Speaker 1: a comic book.
Speaker 4: Yeah, I think like a key difference is definitely like
Speaker 4: in terms of pacing. But if I just talk about
Speaker 4: the format for a second, like web tune is a
Speaker 4: medium that is again very very modern because it is
Speaker 4: optimized for the digital format, particularly your phone, so you know,
Speaker 4: it's better to read it on your phone than it
Speaker 4: is on your computer. But and that's because it has
Speaker 4: this kind of vertical scroll format where you know, you're
Speaker 4: kind of very active where you're scrolling through the story
Speaker 4: as you're reading. I kind of like to think of
Speaker 4: it as like watching still TV and you're riding a
Speaker 4: bike and if the more you ride the bike, the
Speaker 4: more the TV moves sort of and that's kind of
Speaker 4: like you know, using your finger to make the web
Speaker 4: tune move. But yeah, it's vertical scroll, pretty bite sized chapters,
Speaker 4: you know, fifty to sixty panels on average, and it's colored,
Speaker 4: which is very different from Japanese manga, which has traditionally
Speaker 4: been uh, you know, black and white. And the stories
Speaker 4: on there are quite diverse in the types of content
Speaker 4: that you can tell for the different genres out there.
Speaker 4: So yeah, it's a pretty it's a pretty new medium.
Speaker 4: There's a lot of different things that make it different
Speaker 4: from novels and TV and all that kind of stuff,
Speaker 4: and a lot of it is you know, the serialized
Speaker 4: format obviously, and also you know the pacing as well.
Speaker 1: And do you do your own illustrations? Do you do
Speaker 1: your own graphics? No?
Speaker 3: So I'm a writer and a producer.
Speaker 4: So you know, my kind of role in this space
Speaker 4: is that I come up with a idea in the
Speaker 4: shower and I got a web Tune and I say,
Speaker 4: you know, I build a pitch essentially, and I say like, hey,
Speaker 4: like and this comes from my background in consulting, is
Speaker 4: that I can make pretty PowerPoint decks. Hey, I have
Speaker 4: this great idea. You know, would you be willing to
Speaker 4: partner on this? And you know, Webtune says yes or no,
Speaker 4: and I still you know if they say yes. You know,
Speaker 4: I staff those teams with artists. You know, usually it's
Speaker 4: a lead artist, and there's also you know, assistance that
Speaker 4: help them, like backgrounds, coloring, all that kind of stuff.
Speaker 4: And then you know, I'm involved like kind of every
Speaker 4: at every step of the production, So storyboards, in game coloring, lettering,
Speaker 4: I'm kind of art directing at those different phases as
Speaker 4: well as writing the story. And then you know, I
Speaker 4: have a little bit of a social media presence, so
Speaker 4: I help market the story as well. But yeah, that's
Speaker 4: kind of my my role in the different stories, and
Speaker 4: we we work on somewhere between five to ten web
Speaker 4: comics that are serialized, which is pretty exciting and they're
Speaker 4: quite different. So my brain is getting tugged in all
Speaker 4: sorts of ways. But I also think about the accessibility
Speaker 4: at a transmedia level, like, you know, would this work
Speaker 4: well as a film, would this work well as a
Speaker 4: TV show and animation? Could I see this franchising beyond
Speaker 4: just just web tunes? And that's that's all strategic stuff
Speaker 4: that I think about. At the concepting level.
Speaker 1: How do you know when something is really resonating with
Speaker 1: an audience.
Speaker 4: What's really great again about this the webtoone platform is
Speaker 4: that you can see that kind of sentiment real time.
Speaker 4: You know, there's a lot of different indicators that can
Speaker 4: indicate how a series is performing. They have like likes,
Speaker 4: they have comments, and you can see those comments in
Speaker 4: real time. I can press publish and then within the
Speaker 4: next hour it's like you can see if people love
Speaker 4: it or they hate it, right, And obviously the community
Speaker 4: is really really nice, so you know, it's it's quite
Speaker 4: fortunate that you know, they're well receiving of a lot
Speaker 4: of the different stories that we tell. But I think
Speaker 4: like that's the thing about serialized format that's really or
Speaker 4: digital serialized format that's really interesting, is like you know,
Speaker 4: you release each week and you get that feedback immediately,
Speaker 4: versus like, you know, as someone who did worked in novels,
Speaker 4: it's like I spent a whole year in darkness pretty
Speaker 4: much without knowing how it's gonna work, and then you
Speaker 4: press publish and you know, you hope it works out.
Speaker 4: Same with like film TV. People spend years on these
Speaker 4: things and they have no idea what people are going
Speaker 4: to say, and getting that feedback has been really great.
Speaker 4: And then also like you know, let's say a reader says,
Speaker 4: I really like this character because of XYZ reason that
Speaker 4: actually sometimes gets me thinking if I didn't have original
Speaker 4: plans for that character, like, oh, maybe there's a way,
Speaker 4: you know, people like this character more than I anticipated,
Speaker 4: maybe that can inform how I progress the story, like
Speaker 4: in the future of that kind of stuff. So that's been,
Speaker 4: you know, again a benefit and something I really like
Speaker 4: about the serialized websine format, And I think it can
Speaker 4: be quite motivating, I think, because I think, you know,
Speaker 4: working in darkness for so long, the only thing motivating.
Speaker 3: You is yourself.
Speaker 4: But the readers, the readers can be the most motivating
Speaker 4: in my opinion, way more motivating than I can hide
Speaker 4: myself up in the mirror, I think.
Speaker 1: And what do you find that you have readership around
Speaker 1: the world? Do you find is it concentrated in in
Speaker 1: like the US and Asia or you really feel like
Speaker 1: you you are getting feedback from all over the world.
Speaker 4: I think there's I do have readers that definitely follow
Speaker 4: me from all over the worlds. I think the webtern
Speaker 4: Us platform that we primarily work with a lot of them,
Speaker 4: A lot of the readers are from the US, so.
Speaker 3: I'm definitely what more well known in the US.
Speaker 4: I think, you know, my goals on a broader level
Speaker 4: are to you know, be more international. So obviously you
Speaker 4: know the stories, and that's all stuff that I think about,
Speaker 4: you know, in terms of trans media, and also like
Speaker 4: when I'm creating concepts, it's like, how can I make
Speaker 4: sure that this is a story that can resonate hopefully
Speaker 4: on the international level, like if it were to be
Speaker 4: localized to Japan or Korea because that's that's also where
Speaker 4: there's a lot of web web tune readers and consumption
Speaker 4: are are in those countries. So that's all stuff that
Speaker 4: I think about and obviously is a part of the strategy.
Speaker 1: What are the benefits of this platform form for a
Speaker 1: young creator who does not have a following, is just
Speaker 1: starting out, that has a story that really want to
Speaker 1: tell in this medium?
Speaker 4: Well, I think through serialized storytelling it's a great way
Speaker 4: to learn how to storytell. I think when I was younger,
Speaker 4: you know, it was all about there was so much
Speaker 4: time spent planning. And this is the thing I see
Speaker 4: a lot about a lot of new creators. It's like
Speaker 4: there's so much time spent planning and being paralyzed with
Speaker 4: wanting to create the biggest story, the next one piece
Speaker 4: or Harry Potter, when ultimately the best way to learn
Speaker 4: how to storytell is by releasing things. And I think
Speaker 4: that webtoon as a format and any sort of story,
Speaker 4: the serialized storytelling medium allows for you to learn because
Speaker 4: it forces you to do something, It forces you to release,
Speaker 4: It forces you to put something out chapter one and
Speaker 4: then and then you get some readers on the platform
Speaker 4: and they want chapter two, and you have to give
Speaker 4: them that.
Speaker 3: So I think there's a lot.
Speaker 4: Of learning as a as an early creator that you
Speaker 4: can get from, uh from working kind of in this
Speaker 4: sea your last format. And again, webtune Canvas has a
Speaker 4: really accessible what's it called, platform for publishing for newer creators.
Speaker 3: I think so yeah.
Speaker 4: I think like I didn't know about canvas at the time,
Speaker 4: and I was fourteen, and I didn't know how to
Speaker 4: work with artists or how any of that stuff worked.
Speaker 4: But if I could go back, I would say, like
Speaker 4: it would be really cool to test my hand earlier
Speaker 4: on to create one shots or create like a like
Speaker 4: a short series that could teach me more about the
Speaker 4: production process earlier on.
Speaker 1: Interesting. Well, Brandon, I'm so grateful for you to take
Speaker 1: the time to talk me through this and my kind
Speaker 1: of rudimentary questions here. Anything that I didn't ask you,
Speaker 1: anything that's significant about the storytelling opportunity, the business opportunity
Speaker 1: of web tunes that you'd like to add.
Speaker 4: I think, you know, webtune in the format is a
Speaker 4: great way for a lot of creators to tell a
Speaker 4: amalgam of different stories, like there's a there's really U
Speaker 4: Sky's the limit. I think it's like one of the
Speaker 4: best ways if you are a creator that wants to
Speaker 4: go eventually transmedia. I think webtune is a great testing
Speaker 4: ground for a lot of concepts. Like you know, it's
Speaker 4: it's it's cheaper to create a webtune comic than it
Speaker 4: is to try and fund a full on Marvel television show, right,
Speaker 4: So I think like it's a great way to learn
Speaker 4: how to storytell, it's a great way to to build
Speaker 4: IP and uh, you know, if that that's a goal
Speaker 4: of any creator, I think, like you know, it's something
Speaker 4: that people should be looking at.
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