(Bloomberg) -- SoftBank Group Corp.’s Z Holdings Corp. unit is betting on non-fungible tokens and its PayPay service to drive growth as it invests aggressively to expand its global presence.
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SoftBank merged Line Corp., one of Asia’s most popular messaging apps, and Yahoo Japan last year to create an e-commerce and social media giant to compete with global tech leaders. The enlarged firm, Z Holdings, now plans to launch an NFT marketplace in 180 countries this spring and is spending large sums of money to double fintech unit PayPay’s users to 90 million, according to the company’s top executive.
Web3 has become an umbrella term for a growing list of blockchain-based applications such as crypto currencies and exchanges, decentralized finance and the trading of NFTs. It has taken off in popularity with the support of celebrity endorsers and venture capital players like Andreessen Horowitz.
Z Holdings, which makes the bulk of its revenue through mobile ads and spending, is keen to expand by tapping a five-year budget of roughly 500 billion yen ($4.3 billion) for growth initiatives. Its shares surged as much as 7.8% Thursday in Tokyo, their biggest intraday gain since November. Naver Corp., which owns part of Z Holdings, surged 9.4% while SoftBank climbed more than 4% amid a broader market rally.
“It’s possible Web3 will herald a world where life is completely different and we don’t want the company to miss out on the huge growth opportunity,” Kentaro Kawabe, co-chief executive officer of Z Holdings, said in an interview. “We won’t hesitate to do merger and acquisition deals to boost our presence.”
The company will be among the early adopters of NFT trading in Japan, following Rakuten Group Inc.’s February launch of an NFT market focused on music and anime content. Web3 investor and content developer Animoca Brands said it plans to enter the Japanese market with its NFT business and open a local office in April.
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PayPay, a smartphone payment service based on QR codes, has been one of SoftBank’s more successful investments, built in collaboration with India’s Paytm. Initially fueled by heavy spending on consumer enticements, PayPay is expected to serve as another pillar of growth for Z Holdings. While the focus for now remains on increasing user number, Kawabe said he hopes to turn the business profitable over the next few years.