Show Me The Money

Chinese Millennials are flocking to the anime and gaming site Bilibili. But can it make a profit?

- Yue Wang

Anime and video games have long been an obsession for Li An, but the 30-year-old IT worker from China’s southern city of Shenzhen can spare only about an hour a day to indulge his interest. When he goes online to watch videos of his latest fascination, a sci-fi game about androids taking over the world, there are several platforms competing for his attention, but he’s loyal to just one site. “I discovered Bilibili when I was in college,” Li said. “It’s still one of my favorite pastimes today.”

Li is one of more than 77 million Chinese fans watching the animation and gaming videos hosted by Bilibili every month. The Nasdaq-listed company sees that user base, which is both internet savvy and loyal, as its biggest advantage. Chen Rui, Bilibili’s chief executive, told local media recently that its strategy is to offer more online services, such as gaming and paid memberships, so it can boost revenue and start turning a profit. The company’s revenues more than doubled to $138 million in the first quarter this year, with losses shrinking to $9.2 million.

Under the leadership of the 40-year-old Rui, a confessed anime fan as well as a serial entrepreneur, Bilibili has carved out a formidable niche while going up against internet giants like Alibaba and Tencent, which have been spending billions in a cutthroat race to dominate the country’s massive online video market. Analysts say Bilibili has some unique advantages, but it remains to be seen whether the company can turn a profit while keeping all those Chinese Millennials engaged.