Twin sisters score Japan’s hottest IPO

To the rising record of issues that make gaming startup Coly Inc. uncommon, it will probably add among the best market debuts in latest Japanese historical past.

Co-founders Anna and Mizuki Nakajima — they’re twins — took their seven-year-old cell video games studio public Friday, and the stock doubled, the strongest market debut of 2021. As of Tuesday’s shut, every sister’s 33.75% stake was value 15.2 billion yen ($141.5 million).


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In each international gaming and Japanese business, Coly’s success and its 32-year-old executives stand out. Almost three-quarters of its 200 workers are ladies, they usually’ve scored two hits with serial story traces which have saved followers — additionally principally ladies — coming again for the following plot twist.

The company’s specific style is known as otome, Japanese for “maiden.” No one wins, per se. The thrill comes from the story and gamers’ attachments to their favorite characters. Fans of Coly video games reward their high-quality scripts, graphics and music, they usually just like the fantasy worlds the company’s created.

In Stand My Heroes, the participant assembles a squad of good-looking drug enforcement officers; in Promise of Wizard, the participant goes on a role-playing quest to save lots of the world with the assistance of magic and handsome males. Free to obtain, the video games require no particular talent. Players pay to disclose further story traces, not power-ups.

The market for otome video games is round 80 billion yen, in keeping with Coly’s estimates. That’s simply 6% of the 1.3 trillion yen market for smartphone video games in Japan, however followers are usually fanatically devoted and keen to stay with titles for a very long time, in keeping with business analyst Serkan Toto of Kantan Games.

One fan mentioned she acquired hooked on Coly’s video games after her favorite real-world movie star introduced his engagement. She didn’t need to give her actual identify as a result of, she mentioned, she worries folks will tease her about her devotion to fictional characters. The sport is sort of a sanctuary, she mentioned, and the characters by no means disappoint her.

In Japan, feminine followers who get emotionally connected to in-game characters are dubbed “yumejoshi.” Another huge phase of the otome viewers is known as “fujoshi,” gamers preferring tales of male friendships, romances and rivalries.

Handling such a passionate group may be difficult, as Coly was reminded shortly after its IPO submitting. In its investor prospectus, the company referred to its “yumejoshi” and “fujoshi” followers, and gamers took offense on the appropriation of the phrases they usually use in a playful, self-deprecating manner. Coly apologised for “inappropriate expressions.”

Coly declined to answer questions for this story or make executives accessible for interviews, citing “consideration to users.”

For rising stars of their business, the 32-year-old Nakajimas maintain a comparatively low profile. Before beginning Coly in 2014, neither had a technical background. Mizuki labored within the funding unit of Morgan Stanley MUFG Securities Co., and Anna spent a stint at Japan’s Sankei newspaper.

Mobile otome video games are sometimes cheaper to make than the standard console or high-end PC titles, which lowers the obstacles to entry for brand new corporations like Coly. It additionally opens the door to competitors and copycats, and few titles keep well-liked for a number of years the best way Coly’s have.

According to its filings, income and income have grown steadily since its begin, in stark distinction to the up-and-down outcomes which are extra frequent to cell sport makers within the nation. The clean ascent helped the Nakajimas keep away from outdoors funding. Prior to the IPO, they held on to 90% of the company; the remaining 10% was owned by one other government.

“Seeing a pair of women setting up a company and successfully leading it to a stock exchange is truly exceptional in Japan,” mentioned Daisuke Iijima, chief researcher at Teikoku Databank. Only 8% of Japanese companies have feminine CEOs, most of whom are of their 60s and 70s and inherited the position from a relative, Iijima added. In the software business, fewer than 5% of corporations are led by ladies.

Analysts and buyers are nonetheless skeptical, mentioned Ace Research Institute analyst Hideki Yasuda. A few hit video games may nonetheless be thought of fortunate, and the company might want to broaden its attraction past its present buyer base, he added.

One potential new market could possibly be abroad. Global familiarity with anime and the encompassing tradition has been rising, mentioned Kantan’s Toto. China and South Korea have embraced Japanese popular culture developments up to now. Nexon Co. noticed its US income surge after it acquired Pixelberry Studios in 2017, a maker of narrative video games for ladies like Choices: Stories You Play.

“There are a lot more Japanophiles around in general now compared to a decade or two ago,” Toto mentioned.

The dedication of gamers may spill over into the true world, comparable to when followers of Exnoa Llc.’s Touken Ranbu flocked to shrines and museums and donated tens of hundreds of thousands of yen to revive historic gadgets that sport characters have been tied to.

“The market’s potential is wide open,” mentioned Naoko Kino, president of sport consultancy Kyos Co. “Games have never been so close to women thanks to to the ubiquity of smartphones.”

© 2021 Bloomberg

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