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Tokyo-based Cover, the startup offering management production services of VTubers (short for “virtual YouTubers”), announced on Friday that its IPO application to the Tokyo Stock Exchange (TSE) has been approved. The company will be listed on the TSE Growth Market on March 27 with plans to offer 1.5 million shares for public subscription and to sell 1,864,100 shares in over-allotment options for a total of 10,927,400 shares. The underwriting will be co-led by Mizuho Securities and Mitsubishi UFJ Morgan Stanley Securities while Cover’s ticker code will be 5253.
Based on the estimated issue price of 710 yen (about $5.3) and total number of issued shares (61,124,200), the company will be valued at 43 billion yen (about $320 million). Its share price range will be released on March 7 with bookbuilding scheduled to start on March 8 and pricing on March 14. According to the consolidated statement as of March 2022, they posted revenue of 13.6 billion yen (about $101 million) with an ordinary profit of 1.85 billion yen (about $13.7 million).
Founded back in June of 2016, Cover started with producing virtual reality content followed by releasing the Ping Pong League game back in 2017. The company launched Vtuber Tokino Sora in September of 2017, which became later a smash hit.
Subsequenly, Cover launched the Hololive female VTuber group which later led to their Vtuber agency business called Hololive Production. The company now has 71 Vtubers (48 for Japan, 9 for Indonesia, and 14 for English-speaking countries), and 31 out of them have earned over 1 million followers in their YouTube channel. The total number of YouTube Channel followers of all VTubers in the company has exceeded 10 million.
Cover’s monetization hevily depends on Vtuber and its related businesses such as producing livestreaming content, live performance events, merchandising, and licensing and tie-ups. Led by CEO Motoaki Tanigo (38.2%), their major sharholders include Strive (17.3%), Valley (5.5%), CTO Kazuyuki Fukuda (5%), and Mizuho Capital (3.6%).