Japanese instant messaging service expected to raise $1 billion at IPO

folarin okunola

July 15, 2016 2:49 PM

With about 218 million monthly users, Line has opened retail stores, delivered rides and groceries, and sells hundreds of millions of dollars' worth of digital stickers per year.

Line

Line, the Japanese instant messaging app that is very popular in Asia, will start trading today in New York and Tokyo, after it announced its Initial Public Offer (IPO).

Line is a platform that lets its users call and message friends, engage in news and entertainment content, make payments via mobile, use a gaming studio and so on. Think of it like a combination of WhatsApp, Skype, Twitter, Zynga, Spotify and Uber.

With about 218 million monthly users, Line has opened retail stores, delivered rides and groceries, and sells hundreds of millions of dollars' worth of digital stickers per year. This IPO is the biggest of any tech company this year.

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All of that is great but it's not all rosy. According to CNN, Line notes in its IPO filing that there has been a "significant decrease" in the amount of users it has outside its core Asian market, something competitors like Facebook-owned WhatsApp and WeChat don’t have to deal with as they continue to grow globally.

However, those growth concerns don’t seem to affect investor confidence, especially as Line is expected to raise more than $1 billion from the IPO, which is due, in part, to the lack of tech companies going public this year.

Line had initially wanted to go public back in 2014 but those plans were shelved. This time, the company is benefiting from this deal "because there are so few deals happening," says James Gellert, CEO of Rapid Ratings.

Line will be the fifth company to go public this year, compared to 14 that had gone public by this time last year, according to data from Reconnaissance Capital.

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