❓Why now

While not exhaustive, what gives us conviction is the market pull we see on both a macro and micro level for Waifus

1. Culturally demanded and lasting genre: High LTV crypto-native weebs likes Anime Fantasy-themed Waifus

According to State of Mobile 2024 by data.ai, top games across years, downloads, and billion dollar spend are anime fantasy themed, e.g., Genshin Impact, Honkai: Star Rail, Uma Musume Derby
Web3 communities have proved genre traction via anime IP, e.g., Azuki, 0N1 Force, DigiDaigaku, Overworld Incarna
Crypto-native weebs have affinity for anime/e-girls (product desirability) and are high willingness to pay (high LTV) + sophisticated (mid-core gamers)

Companionship is on the rise both in sheer velocity of monthly visits, amounting >330m monthly visits
CharacterAI, with ~21% of the scale of ChatGPT, is one of the strongest early players—with DAUs rivaling ChatGPT, and significantly better retention, according to Sensor Tower data.
AI Companion models have already seen growing demand
- Replika, >20m lifetime downloads, > $50m in lifetime revenue
- Character.ai, >330m monthly website visits
- CarynAI, a “virtual girlfriend” created by influencer Caryn Marjorie, made more than $100,000 the first week, she said. and there’s a waiting list of thousands to gain access.

“We believe we’re on the cusp of a significant societal shift: AI companions will soon become commonplace. And at a16z, we are excited about it.”

AI Waifu is designed on the backing of strong tailwind themes
- High engagement & monetization through Immersive Fantasy Lore
- Hitting high LTV gamer cohort through cross-platform mobile and PC access via progressive web app (PWA)
Home in Asia where it leads crypto adoption rates, mobile pen., and has massive size of mid-core gamers
- Asia/APAC appears to have the highest mobile penetration rate, with a rapid rise from 44% in 2021, boasting 1.2 billion mobile internet users, to a projected 52% by 2025, reaching a staggering 1.5 billion users (GMS Association)
- Central and Southern Asian nations boast some of the highest global crypto adoption rates in 2023 (Chainalysis)
- Asia's dominance extends to the Web3 gaming space, with the region hosting the majority of the top 15 countries showing the most interest in this emerging sector (CoinGecko)
- Asia has solidified its position as the prime global hub for mobile games by revenue, with RPGs taking the lead as the top favourite genre (data.ai)

Loneliness is a $B societal problem that often is not directly addressed nor spoken about that could impact Asia's $10 trillion consumer market
Yet, the desire for companionship, connection, and love fervently grows as we progressively become disconnected
Digital companionship is a burgeoning demand but falls short with static one-way conversations with chat bots
AI Waifu creates a new frontier of entertainment that personalises and immerses users

We believe this is the iPhone moment of AI x Gaming

Last updated 1 month ago