Tech

Tim Culpan is a technology columnist for Bloomberg Gadfly. He previously covered technology for Bloomberg News.

Line, the Asian messaging app that's not WeChat, is in the market for acquisitions, CEO Takeshi Idezawa told Bloomberg's Yoolim Lee and Yuji Nakamura. 

After raising $1.3 billion in its Tokyo and New York offerings last month, the Japanese company has a team scouring the globe for possible targets to help it become a smart portal.

Shopping can be a tiring task even with a dedicated group of colleagues pitching in, so here's a list to help Idezawa get started. I've focused on companies that would both add value to Line's business and benefit from its reach, technology and existing messaging interface.

Bigo Live
Never heard of it? Southeast Asia has. The live-broadcasting app tops the social-networking category in Indonesia, Cambodia and Singapore, and is in the top five of another half-dozen markets including Vietnam, Thailand and Malaysia, according to App Annie data. For Line, Bigo checks all the right boxes: user engagement, demographics, regional reach, advertising potential, and buzz.

Watch Me
Bigo Live is currently the most downloaded social-networking app in the Google Play Store in three countries and ranks Top 10 in 15 markets
Source: App Annie
Figures as of Aug. 24, 2016 for Google Play Store. iOS rankings are similar.

Foodpanda
Clearly, food delivery should be on Line's menu. The sector is taking off globally and it just makes sense to integrate such functionality into Line's messaging app. While there are dozens of choices out there including Grubhub, Deliveroo and Happyfresh (which is grocery delivery, not prepared food), Foodpanda is big in existing core markets like Taiwan and Thailand, and is doing quite well in prospective markets like Indonesia, such that Line's team shouldn't have too much difficulty digesting the business. The fact that Rocket Internet has shown a willingness to sell assets in this part of the world makes an acquisition or joint venture realistic.

Carousell
Continuing the online-shopping theme, Carousell looks to be a no-brainer. It's very much a consumer-to-consumer product that could only benefit from being integrated into the most C2C of apps, messaging. With an early solid base in Indonesia and Thailand, Carousell has room to improve and grow, and the kind of regional ambitions that seem to fit Line's own plans.

On Line Advertising
Content, such as games and music, were once the backbone of Line's revenue but have now been surpassed by advertising
Source: Line, Bloomberg

Appier
Away from consumer-facing apps, Line could benefit from some back-end technology. While content such as games and stickers are the backbone of Line's business, advertising has grown to be the biggest individual contributor. Yet the market is crowded, with advertisers not short of places to ply their wares. An adtech acquisition, or investment, could help give Line a leg up on the competition. Sequoia-backed Appier is one such possibility.

In truth, Appier may be a bit expensive for Line's modest budget, and its board is more likely to favor an IPO rather than an M&A exit -- yet it's the kind of company they might want to chat with. If things don't go well for Appier's exit, given the crowded adtech market, Line could be a solid Plan B.

In most cases an outright purchase may not be necessary, with an investment or joint venture serving Line's interests just as well. Suggestions welcome.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Tim Culpan in Taipei at tculpan1@bloomberg.net

To contact the editor responsible for this story:
Paul Sillitoe at psillitoe@bloomberg.net