COVER Corporation

COVER Corporation operates at the forefront of Japan's 2D entertainment sector, primarily focused on the creation and management of virtual entertainer character intellectual property (IP). The company was founded on June 13, 2016, by Motoaki Tanigo, an entrepreneur with a rich background in game software production and mobile content, having worked with notable companies like Sanrio and Imagineer. Tanigo's journey includes founding several startups; his experience with a prior venture's failure sharpened his focus for COVER, aiming to build upon his expertise in content and technology. Initially centered on augmented and virtual reality software, the company pivoted after the surprising success of its first virtual character, Tokino Sora, who debuted in September 2017 to promote a VR game and proved more popular than the game itself.

This pivotal moment led to the establishment of hololive production, a Virtual YouTuber (VTuber) agency that now manages over 80 talents across Japanese, English, and Indonesian languages, collectively boasting more than 88 million subscribers. The business model is multifaceted, generating revenue through four primary segments: Streaming/Content (25.3%), Live/Events (18.6%), Merchandising (41.4%), and Licensing/Tie-ups (14.7%), showcasing a strategic shift towards an IP-centric commercial structure. This model involves nurturing talent, who stream content using company-provided anime-style avatars and proprietary motion-capture technology, and then leveraging the resulting popularity for large-scale commerce. The company takes a percentage of talent earnings from donations, subscriptions, and sponsorships in exchange for providing software, management, and production support. In a significant milestone, COVER Corporation went public with an IPO on the Tokyo Stock Exchange on March 27, 2023.

COVER provides its talents with proprietary applications for live streaming, which use smartphones and motion-capture devices to track facial expressions and body movements in real time. For more elaborate productions, like 3D concerts, the company utilizes advanced studio facilities equipped with optical motion-capture systems. Beyond the core streaming business, COVER has expanded its IP monetization through a diverse range of merchandise, from trading cards to character goods, and extensive licensing collaborations with external brands, including food companies and professional sports leagues. The company is also developing its own metaverse platform, "Holoearth," intended to evolve fans into creators within a shared virtual space. To support its global ambitions, COVER established a U.S. subsidiary in Los Angeles in July 2024 to facilitate localized events and business development.

Keywords: VTuber, hololive production, virtual entertainment, Motoaki Tanigo, character IP, live streaming, motion capture, Japanese content, virtual reality, augmented reality, talent management, digital content, merchandising, licensing, Holoearth, COVER Corp., virtual avatars, content creation, IP monetization, Tokyo Stock Exchange, 5253