Japan’s Line Corp., which has been investing heavily into fintech operations, may see the new businesses break even in as early as one to two years, co-Chief Executive Officer Shin Jung-ho said in an interview.
The services, which will eventually include banking, stock trading, loans and insurance, could turn a profit in three years, depending on how quickly the company can get the necessary licenses and attract users, Shin said. The next two to three years are a crucial window for figuring out user needs and the company is focusing on the home market and Taiwan first, he said.
The operator of Japan’s most popular messaging platform, facing a stagnant user base and a business model that relies on advertising, is doubling down on payments to underpin other financial offerings and transform into an all-in-one app like Tencent Holdings Ltd.’s WeChat. The company last year raised 148 billion yen ($1.4 billion) in a convertible bond sale to help fund the expansion. Its shares fell to the lowest since the initial public offering in June on the prospects of losses ahead.
“Fintech itself is a proven monetized model, the only problem is how fast we can secure a meaningful size of users,” Shin said in a interview with Bloomberg Television at the company’s Tokyo headquarters. “We need three to four years of investment to establish” the business, he said.