Joseph Phua, executive chairman and CEO of 17Live Group, is confident that within the next three to five years, the entertainment company will become the leading live-streaming player globally.
It took him slightly over a decade to build a billion-dollar content business, with the strategy of acquiring successful businesses to leapfrog its growth. Today, 17Live is the leading live-streaming player within Northeast Asia, says Phua.
Building a billion-dollar content business
Phua is no stranger to taking up a challenge. In 2013, Phua founded Paktor, a pioneering dating app which was later merged with 17Live. After he made his first acquisition of podcast company SoundOn in Taiwan, he started to build a team around investing and acquiring.
In 2016, Phua began to build 17Live, introducing live-streaming technology to empower content creators around the world.
Back then, live streaming and virtual gifting were not synonymous with each other. Inspired by China’s success in this realm, Phua followed suit and introduced a similar format of live streaming, gifting and offline events in Taiwan. The business took off, growing from $200,000 to $5 million in monthly revenue within six months. This “meteoric success” in Taiwan saw 17Live eclipsing the rest of the Asian players, he says.
Next, Phua had his sights on Japan, a notoriously competitive market known to be even tougher for foreign companies to break into.
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On a business trip with its shareholder company, venture capital firm Headline, Phua hunted for many potential local partners to build a live-streaming product. They went knocking on every door of gaming and social companies, but to no avail.
“No one believed live streaming technology would be something this huge. They did not believe that it had the potential to be a multi-billion-dollar business in Japan. And so, none of them were willing to work with us,” recalls Phua.
It ended up working with Headline to build the product in Japan. Within six months, they went from zero to a hundred-million-dollar business. It took them some three to four years before they emerged as the market leader.
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Unlocking growth
Phua recalls a game-changing incident that showed him the massive potential of live streaming. When he first took over the company in 2016, they held a live-streaming competition at a Taiwanese TV station. The teams on screen competed to answer questions and complete activities to win a prize. Phua saw how competition drove gifting behaviour.
The very next day, he invited two streamers to the 17Live office for an open stream challenge. They sat side-by-side, two phones facing them, with a television screen behind them showing how many points either streamer earned during that hour. The streamers would entertain their viewers and call out for points to be earned at the same time.
Whoever earned the most points would win a one-night hotel stay.
Within that hour, 17Live made $5,000 — more than what the company earned in a single day on the whole platform.
“What we realised was that running competitions like these, stirring things up, actually drove revenue after the competition,” Phua explains.
In addition, Phua realised that the emotional highs of live streaming were key to unlocking more growth.
“After the competition, whether one won or lost, the atmosphere was emotionally charged. Both streamers were emotional and felt deeply in terms of their connections with their audiences,” he says.
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Phua adds: “It dawned on me that human emotions had the potential to drive monetisation. I figured that if I could use operations and related strategies and techniques to ramp up the emotional factor on live streams while leveraging competition, the monetisation potential would be huge.”
The secret sauce
At the heart of it, focusing on the user journey is key, says Phua. As he breaks it down, one begins to understand the complex interplay of factors like business and human psychology.
For new users who join the platform, they want to discover content they enjoy and find content creators they would like to meet. These users start their first interaction with the platform by being greeted by a content creator and being gifted with free points to send free gifts. In turn, they are rewarded with targeted content, creating a “positive feedback loop”.
That is the secret behind why users keep returning to 17Live over and over again, says Phua.
In turn, the users experience a newfound empowerment and self-expression. With just a mobile phone, users can showcase their talent on a platform that is immediately accessible to them.
“Users build a virtual world where they can shape their ideal virtual self. It’s a level playing field where one’s looks and background do not matter. All that matters is the persona you want to shape,” he explains.
Essentially, it is about handing the power back to the consumer — stripping away the need for middlemen, gatekeepers, labels or agencies, says Phua.
Changing lives, one at a time
But beyond the successful metrics and profits, Phua wants to make it clear that 17Live is a company with a heart. It shapes the lives, hopes and dreams of its 87,000 contracted streamers globally, or “dreamers”, as he calls them.
Among them is Japanese streamer and bar owner Naoking, one of the longest-staying streamers who has been live streaming almost every single day since 17Live started in Japan seven years ago.
To see Naoking still creating content today, making a decent living and supporting the platform is a clear sign of the company’s impact, says Phua.
There is a sense of ownership through the process too. Naoking regularly offers his own ideas and feedback to 17Live’s product team, for instance.
“The content creators feel like they’re empowered. This platform belongs to them in the sense that they’re building themselves, their dream, on a platform where they have a lot of input and control. That’s the number one reason why these content creators have been with us for a long time,” says Phua.
Bouncing back from challenges
17Live’s journey was not always smooth sailing. In 2018, it hit a rough patch when it executed a corporate action that was not successful, which put the company in a difficult position, says Phua.
Reflecting on those dark days, he says: “It felt like the world collapsed around me and it was the end of the world.”
Phua pulled himself together. He knew he had to rally his team and partners, outline the strategy forward, and be aggressive about the execution.
At that darkest moment in time, Phua was shuttling between Singapore, Taipei and Tokyo. To show his dedication to the company, Phua moved his entire family to Taipei, where for six months, he was the first one in the office and the last one out.
He says: “I wanted to show our colleagues and partners that even if the sky falls, I’m still here. There’s nothing to be worried about. We will solve all the problems together. They needed hope that this company would still be around, and we were not in a mess that we couldn’t get ourselves out of.”
Fortunately, 17Live was able to weather the worst of the storm. By 2020, it was among the first companies in Asia outside of China to be profitable.
Once the Covid-19 pandemic hit, live streaming suddenly became the hottest thing on the market. 17Live rode on the momentum and became the top live-streaming platform in Japan and Taiwan.
Today, Phua employs the same strategy when it comes to tough situations. “Whenever we find ourselves in a pickle, we have to rally our partners and colleagues, set and execute on a fixed, but simple, strategy,” he says.
“A motto I live by would be to never give up. As long as you don’t give up, you would not have failed. While we might not be number one now, we will not shut down so long as we keep going, the company remains profitable and there is cash in the bank,” he says.
Phua says it was important for him to repay the kindness, faith and trust placed on him by his team who had dedicated their lives to building the company since day one. It is this sense of accountability that keeps him motivated.
Combatting the naysayers
Despite 17Live’s success overseas, the platform is still largely unrecognised in Singapore, says Phua.
As opposed to markets like Japan, Taiwan, Hong Kong and the US that have a vibrant and dynamic entertainment market, live streaming still has not taken off in a big way in Singapore.
But Phua is confident that things will change in a matter of years, particularly as the company is still fairly young. “This is just the starting point,” he says.
Live streaming is still a fairly new trend, and the value creation they are seeing is only the tip of the iceberg. The potential of the market is “immense”, he says.
Going forward, Phua is determined to replicate its strategy in other markets. That will put it in good stead against its challenger TikTok, he says.
He says: “That gives me the confidence to say that I believe we will be able to win, because a platform that wins is a platform that can be continuously and sustainably profitable in the business. And all our core metrics are strong. When you put math and operations together, it shows you that within three to five years, we can be the biggest star.”
About 17Live
17Live is the top pure-play live-streaming platform (by revenue) in Japan and Taiwan combined. Its business lines include Liver live-streaming, V-Liver live-streaming, and other businesses such as in-app games and live commerce. 17Live is accessible globally, and its key markets of operations include Japan and Taiwan, with a presence in Hong Kong, Singapore, the US, the Philippines, India and Malaysia. It has fostered a diverse live-streaming ecosystem with a loyal and engaged user community, as well as a deep pool of live streamers.
The company’s website is https://about.17.live
About kopi-C: The Company Brew
kopi-C is a regular column by SGX Research in collaboration with Beansprout (https://growbeansprout.com), a MAS-licensed investment advisory platform, that features C-level executives of leading companies listed on SGX. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.
