I grew up with anime and games since childhood, and I have always been fond of such culture. My father was an art dealer, and that gave me a lot of exposure to contemporary and other types of art. So from an early age I developed a strong interest in art and creativity. When I think about it, there may be a sense in which I perceive entertainment, such as games and anime, in an artistic way.

When I was working in the London branch of a securities firm around 2018, I watched quite a lot of YouTube in my free time and was quite interested in the trends in VTuber culture. In those days, the popularity of Japanese manga, anime, and Vocaloid culture was gradually spreading throughout London. Later, the under the pandemic lockdown^*1, anime and internet culture became popular with mass audiences through Netflix and other media. I was in London at a time when such Japanese culture was becoming mainstream, and I was also keeping a close watch on the new VTuber culture that was emerging from Japan and gaining momentum.

Also, from my perspective as a consumer, I was struck by the uniqueness and novelty of VTubers’ creativity. At the time, I was witnessing the birth of various start-ups in Japan and abroad, creating new value in the world. I felt that VTubers had great potential to create a new industry by utilizing the uniqueness of Japan.

After that, the stimulus for my joining COVER was applying for the position of international business development manager. When I had the opportunity to speak with Tanigo during that process, I shared my thoughts on how to achieve sustainable business expansion and growth. COVER in 2021 had more than 100 employees and was preparing to relocate its office. Amid the rapid and intense expansion of COVER and its customer base, it was decided that I would officially join the team upon completing my assignment in London. In February, I began working as the GM of the Corporate Planning Office. Back then, I worked in business planning in a newly established department and later was appointed CFO.

I feel that the experience of how finance theory works in the global financial market, where vast amounts of money move, is the basis for my mindset when communicating COVER’s growth potential to the capital markets. Also, my experience in project management in multinational teams through the execution of global IPOs and other deals has been valuable when leading projects in various regions as GM of the Corporate Planning Office here.

In my work at the securities firm, creating added value involved highlighting the unlocked corporate value of client companies, including their growth potential, through various logical approaches, and conveying it to the capital markets to materialize it as actual market value. In particular, when setting a stock price to a company without an existing market valuation, such as in IPO deals, it is crucial to emphasize the “art” aspect of presenting the company’s vision to the market as something achievable. This is something that cannot be fully conveyed through performance metrics or financial formulas alone. This is also the case in the work of CFOs in operating companies, where they routinely consider how to define the relevant market for their business and how to logically explain corporate advantages such as barriers to entry and scalability within that market.

On the other hand, the work of a CFO differs from that of a securities firm. CFOs must not only explain the growth potential of the business to the world, but must actually invest in their businesses according to the growth story they have built and take risks to achieve growth. There are tough situations where things don’t go as planned in the process of driving business operations and achieving growth. Yet, the opportunity to proactively engage in investments and business development that can have a significant impact on society is a uniquely rewarding aspect of working at an operating company. That is something I couldn’t experience in a securities firm.

The reason I was drawn to COVER is that the respect for the artistry and creativity is connected to the uniqueness of the business. As mentioned earlier, my father worked in the art industry, so I have always had a great respect for art and artists. As a consumer, I also found a lot of appeal and uniqueness of COVER and its and hololilve content.

I think that what is important for a successful business is to be able to establish a strong competitive advantage by achieving a balance between uniqueness and scalability. In the case of COVER, I think that the basic stance of “empowering creators with strong individuality through technology” has allowed us to balance the uniqueness of the content created by the discretion and creative ability of the creators with the expandability of technology such as AR and video media. In turn, this has led to the creation of a large cultural and economic sphere not only in Japan but also around the globe.

Since I started working at COVER, I have had many opportunities to do business with key people in the anime and game industries. As I used to watch and play these as a consumer, I am happy to be working in an industry that I admired as a child. For example, I am a fan of the FINAL FANTASY consumer games series, and I think this franchise even influenced my own character development (lol). Coincidentally, one of COVER’s outside directors is Yoichi Wada, former CEO of SQUARE ENIX CO., LTD. Being able to hear management advice from someone who created the works that influenced my life is a very precious opportunity indeed. We too are strongly motivated to create content that will have an impact on the next generation.

By continuing to create content that appeals to the sensibilities of younger audiences, we aim to have VTubers supported by two or three generations of fans in 30 years’ time. When we see that it will mean to me that the virtual economic sphere that COVER is aiming to establish has been achieved.

An important point about the growth potential of VTubers is that their fan base is expanding along with the growth of the global anime market. The anime market has grown nearly twofold since around 2013^*2, driven by the expansion of overseas markets, and currently boasts a global market size of nearly 3 trillion yen. The geographic distribution of VTuber viewers is similar to that of anime consumption regions. That’s why I am confident that the expansion of anime content consumption is a tailwind for the expansion of consumers in the VTuber-related market.

And when you look at VTubers in the context of anime content, what is particularly noteworthy is that by releasing content at a high frequency throughout the year, they can continue to sustain fan engagement while maintaining a high level of customer touchpoints. This is a significant advantage when compared to the current state of the anime industry, where many serial TV anime take a long time to produce before they are consumed.

Furthermore, COVER’s unique competitive advantages is that not only do the VTubers themselves produce content frequently as creators, but their fans also become UGC creators and produce related content, and thus establishing an ecosystem. In our case, COVER-affiliated VTubers release around 3,000 livestreams and video content pieces per month. For each of these, fans create UGC such as translated videos or highlight clips. As result, the influence of our VTuber creators is leveraged several times over compared to if they were operating independently. This UGC^*3 (user-generated content) ecosystem is one of our competitive advantages.

One of our challenges is that the maturity of the anime-related industry varies greatly depending by the country or region. In Japan, anime has become entrenched as an everyday part of culture over the course of 30 to 40 years, and there is a wealth of peripheral businesses such as collab cafes and events. In North America and East Asia, however, supply chains have not yet been established to that extent. The key is to be able to expand in a way that is appropriate for each region while maintaining the same quality of experience as in Japan.

There are also cases where I felt strongly about the potential from this perspective. In the collaboration event with the Los Angeles Dodgers, not only anime fans but also baseball fans were excited by the performance of the VTubers. Through this experience, I strongly felt that VTubers as entertainment have the potential to expand beyond genres and reach people all over the globe.

Of course, we need to localize the approach by region. East Asia has a high affinity with Japanese culture, so it is possible to develop the business relatively close to how we operate in Japan, but at same time, it is possible that each country has its own unique characteristics. The issue that arises is whether to develop content that is easy to understand and communicate when expanding globally, or whether it is better to provide in-depth content for each segment. We are currently focusing on the latter in tandem with working on the former. We are currently taking advantage of the characteristics of VTubers, who can easily provide content that captures regional trends in real time via social media and streaming platforms, and rolling out content tailored to each region.

While driving the expansion of the VTuber and virtual entertainment economic spheres globally, COVER aims to achieve a 50:50 domestic/ overseas sales composition over the medium-to-long term, or even have overseas sales comprise the majority of its business. We plan to first target the anime economic sphere in each region as our core markets to roll out our content, products, and services. We will also gradually deepen localization in line with characteristics of each region.

As a whole, the industry is expected to grow as the top tier consolidates and the base at the middle and lower tiers expands. In addition, I think that COVER will drive the qualitative transformation of the industry itself by continuing to invest in blockbuster content and R&D while increasing profitability through derivative businesses such as merchandising and licensing.

In the medium term, it is important to create a virtuous cycle in which we increase the profitability of our business by expanding our brand influence and laterally developing new products in related areas such as merchandising and card games. We will then reinvest the profits for the creation of even higher quality content. In Japan, the anime-related supply chain is well developed, so it is easy to initiate such a cycle. But overseas, the related markets are not yet as mature. Therefore I believe it is essential to collaborate with various local companies and expand the provision of content, products, and services to local fans in ways that align with the supply chains of each region.

Looking at the long term, I envision that after the relevant economic spheres have expanded and the number of people involved has increased worldwide, there is potential for that platform-type businesses will grow within the ecosystem. The number of people in North America who want to become independent VTubers is increasing. In line with this trend, the need for related services for such people is becoming more apparent. I think that the market for businesses aimed at people who want to become VTubers will continue to grow in the future.
I want to expand the virtual creator economic sphere globally, with a focus on the culture of anime, comics and games, which are Japan’s forte.
Through this, I would like to challenge myself to increase the number of people globally who can achieve self-actualization based on their own creativity without being bound by physical limitations.

That would be “Uniqueness”. In addition to our unique creators, I feel that COVER is able to create a competitive advantage that is difficult to replicate by having experts in various fields such as media technology, merchandising, music, anime, and games pursue their own uniqueness and expertise. In my view, this kind of corporate culture will be a great strength as we continue to expand the scale of our business moving forward.