After Hit Shows, Teen Idol Agency Attracts Big-Name Backers
Riding on the buzz around the “idol economy,” a talent management company is in funding talks with big-name internet firms, paving its way for a listing in the near term, Caixin has learned.
YueHua Entertainment Co. Ltd. has kicked off a new round of fundraising and has held talks with potential investors, including the Tencent-backed Weibo Corp. and Beijing Bytedance Technology Co. Ltd., owner of China’s top news aggregation platform, Jinri Toutiao, according to multiple industry sources.
Bytedance is one of China’s fastest-growing tech startups, with a valuation estimated to be as much as $75 billion, Reuters reported in early August. Bytedance is also behind one of the world’s current most-downloaded apps, a short-video platform called Douyin in China and TikTok overseas.
Set up in 2009, Beijing-based YueHua is one of the country’s leading agencies that is managing “trainees,” a term borrowed from South Korea that refers to teenagers who endure years of rigorous training to become the country’s next top pop idols — if they’re lucky.
The popularity of recent Chinese reality shows “Idol Producer” and “Produce 101” has led some commentators in the country to dub 2018 “the first year of the idols’ reign.” The two shows are filmed and broadcast by online streaming platforms iQiyi and Tencent Video and were collectively watched over 8 billion times. Several of the winners of both shows are part of YueHua’s stable of idols.
The rise of the “idol economy,” which involves fans spending their cash on repeated votes for their idols in talent shows, has drawn the attention of venture capital funds, including the U.S.-based Sequoia Capital and Beijing’s Sinovation Ventures, which was co-founded by former Microsoft Corp. and Google Inc. executive Lee Kai-Fu.
The talent agencies in which these funds have invested are valued at between 100 million yuan ($14.7 million) and 300 million yuan, according to industry sources.
It is clear that YueHua is planning to list on a Chinese mainland bourse, as the China Securities Regulatory Commission disclosed in April that the company had entered the A-share initial public offering counseling period.
YueHua declined to comment on its latest fundraising, while Jinri Toutiao and Weibo didn’t immediately respond to Caixin’s requests for comments.
Contact reporter Jason Tan (firstname.lastname@example.org)
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