Japanese messaging behemoth Line just poured $45 million into a South Korean Snapchat clone in an effort to increase its social footprint in Asia.
The app known as Snow received a fair bit of exposure earlier this year when it claimed to have snapped up 30 million users across Japan, South Korea, and China in less than a year. That figure is since thought to have doubled, now standing at 60 million users, according to Barron’s.
To Western eyes, the app seems almost identical to its popular predecessor — particularly in regard to its clean UI. A closer look, however, revealed that it had some nifty features of its own, including a ton of tonal and selfie filters, and its very own GIF mode. As a result, the app shot to the top of the iOS App Store chart in China this summer, and has since maintained its popularity (it is currently sitting in seventh place in the photo and video category).
Line, which went public in the year’s highest tech IPO, evidently wants in on the action. The deal sees the company take 25 percent equity in Snow, TechCrunch reports. Like so many messaging apps, Snow borrows one of Line’s most iconic (and influential) features; stickers. That’s not the only thing the two apps have in common, as both Line and Snow are owned by South Korean internet giant Naver. Line’s investment will see Naver’s stake in Snow drop from 100 to 93 percent.
Whereas Snow’s numbers don’t match Line’s (which currently boasts 218 million members), it has accumulated users faster than its older rival — it took Snow 11 months to reach 50 million users, compared to 13 months for Line. If it’s anywhere near as addictive as Snapchat, it likely also has a solid daily active user base (although those figures have not been disclosed).
A closer relationship with Line could prove beneficial to Snow in the long-term. In the face of stagnant user growth, Line has created a solid money-spinner in the form of its Stickers feature, which now nets it over $270 million a year. If Snow can do the same with its selfie filters it could have a real monetization opportunity on its hands. Both Line and Snapchat have opened up features to users in exchange for a premium — the former with its stickers marketplace, and the latter with its custom geofilters. Perhaps we’ll see a similar strategy from Snow in the near future.
Line may currently be more concerned with breaking out of its traditional market and into the West courtesy of the $1.3 billion in funds raised from its IPO, but its latest investment shows it’s still attuned with its domestic audience.
