When South Korean tech giant Naver paid $600 million for storytelling app Wattpad on Jan. 19, the companies pointed to global expansion as a rationale for the deal. Specifically, Wattpad CEO Allen Lau tells The Hollywood Reporter, it’s about two numbers.
“What’s better than 90 million monthly users? One hundred and sixty million users,” Lau says. The executive is referring to Wattpad combining 90 million users with Naver’s Webtoon global digital comics platform and its 72 million monthly users, many in the U.S. and Japanese markets.
Launched in 2006, Wattpad is a digital platform that allows amateur writers to publish their own works of fiction online. Wattpad’s model then uses its algorithm to identify intellectual property on its app that can be co-produced as YA projects with entertainment players like Sony Pictures TV and Universal Cable Productions.
An example: The Kissing Booth, a web novel by Beth Reekles, amassed 19 million app reads on Wattpad before it became a Netflix franchise produced by Komixx Entertainment, with The Kissing Booth 3 to debut later this year.
Prior to a sale, Lau and Wattpad co-founder Ivan Yuen listened to offers from global players; Spotify and TikTok owner ByteDance put up formal bids, sources say. But with Naver as the winning bidder, Wattpad is able to accelerate any plans to turn stories on its platform into comic books or animation. Michael Yang, a partner at OMERS Ventures, notes: “There’s the synergy of form factor, from animation/illustration/comics to text, so Webtoon and Wattpad could learn from each other.”
Wattpad has about 90 film and TV projects in development. To date, around 1,500 of its stories have been published as books or adapted for TV and film. The latest screen adaptations include the Indonesian series Turn On, produced with Screenplay Films for the Vidio streamer, and Slow Dancing, co-produced with Singapore’s Mediacorp.
Peter Csathy, founder of advisory firm CreaTV Media, says the deal addresses the issue of global scale. “With Wattpad, Naver now has a prime young adult beachhead in North America while Wattpad sufficiently scales itself in South Korea and Asia,” Csathy says.
Aron Levitz, head of Wattpad Studios, says the firm sets itself apart from rival producers by doing field testing with its users on what resonates on the platform before going into TV or film development. Levitz notes: “That’s how we find our ways into stories, and that’s such a monumental difference to how publishing and entertainment is chosen around the world.”
And Jim Orlando, who sat in the Wattpad boardroom before launching Wittington Ventures 18 months ago, sees the Naver deal for Wattpad and its machine-learning technology changing the rules of the game in the YA space. “Wattpad has a unique ability to identify hits early in the cycle through its AI engine, and this allows it to bring ready-made audiences from Wattpad to other media and hence break above the noise,” Orlando notes.
A version of this story appeared in the Jan. 27 issue of The Hollywood Reporter magazine. Click here to subscribe.