Across The Border | China’s internet celebrities find venture capital funds are their biggest new fans

Chinese internet celebrities have become the latest hot investment chased by money, with a self-made cyber celebrity recently securing 12 million yuan (HK$14.4 million) in venture capital funding to help promote her original content on social media and build a self-sustaining business model.

The nascent “online influencer” industry is expected to expand rapidly over the short term, with more content creators and investors jumping into the market.Companies involved in cyberstar agencies, digital marketing and e-commerce businesses may benefit from the trend, according to analysts.

Papi Jiang, an internet celebrity who became famous by posting spoof or satirical videos on social media sites, recently received 12 million yuan in venture funding for a 12 per cent stake in her team, with the total valuation standing at 100 million yuan. The venture capital firms involved in the deal included ZhenFund, Luogic Show Capital, Lighthouse Capital and Xingtu Capital.

Investors from Luogic Show Capital said they will hold an auction to sell the first ad in Papi Jiang’s videos and help her further promote original content on the web and social media.

As the first example of a Chinese internet celebrity to receive massive venture capital backing, analysts said investors may see the “internet celebrity economy” as a new growth opportunity and plan to build a self-sustaining business model around the intellectual property created by the online influencer.

Internet celebrities, or Wang Hong in Chinese, usually comprise two main types. One is to attract fans by creating original content on the web or social media platforms, including key opinion leaders (KOLs) and online broadcasters. The other type usually sells products via online stores and posts videos of themselves giving distinctive makeup or fashion tips.