5Y News | After Raising Hundreds of Millions in Three Consecutive Rounds, "Yahaha" to Build Real-Time Digital Entertainment UGC Platform
A no-code, multiplayer interactive entertainment creation platform for global users.
No-code multiplayer interactive entertainment creation platform Yahaha has completed three consecutive funding rounds within six months of its founding, including an A1 round led by 5Y Capital, with Xiaomi and ZhenFund as co-investors; an A2 round led by Hillhouse, with BAI Capital and all existing shareholders following on; and an A3 round led by Coatue, with Bilibili and all existing shareholders following on.
Following its latest round, Yahaha is now valued at several hundred million dollars. 5Y Capital has supported the company since its earliest days, backing all three rounds — A1, A2, and A3.
Chris
Founder, Yahaha
Q1
Why did you start Yahaha?
Chris: It felt like a natural next step — or rather, sometimes it felt like Yahaha found us. To borrow a meme that many gamers know: "Yahaha! You found me." That's actually where the name comes from.
Yahaha's goal is to become the next-generation real-time interactive content creation and experience platform. Simply put, one path to achieving this is the democratization of creativity — and that happens to be exactly what our founding team has been exploring for years.
Our core team has been in the trenches together for a long time, weathering many storms together. Through our time at Unity, EA, Microsoft, and building alongside Oculus, we developed strong working relationships. Our collective experience across internet, gaming, and ed-tech allowed the team to mature in relevant technologies, products, and strategy — and ultimately to launch Yahaha at exactly the right moment. Now is when we've finished all our preparations for the long voyage and are raising the mainsail.
So you could say we and Yahaha are answers to each other. Since setting sail, Yahaha has quickly gained recognition and support from many quarters, and attracted more outstanding people to join. The team's growth has been faster than I imagined.
Q2
What do you imagine for the future of this industry? How much of it has materialized so far?
Chris: Yahaha operates in the real-time interaction industry. Currently, real-time interactive content is dominated by games, and the gaming industry has some interesting but starkly contrasting numbers — such as the ratio between market size and the number of frontline game developers. The global games market is approaching $200 billion, and half the world's population are gamers. It's already a massive and still rapidly growing content market. Yet the number of frontline developers actually producing content for this entire market isn't that large. Take Unity, the engine with the largest market share in game development: its active developer base is only around 1.5 to 2 million. And of those, only a tiny fraction successfully bring their creative visions to players.
The ability to imagine things that don't exist is imagination; the ability to then create them is creativity. Imagination is universal and innate — creativity is not. The future Yahaha envisions is one where tens of millions of content creators can interact in real time. Creative equality is Yahaha's mission. We believe that the hundreds of millions of different forms of content created will transform the entire real-time interactive content market and foster a more diverse culture. Roblox's enormous success in the children's market already foreshadows what's coming — that's Yahaha's starting point, and games will be the first stop.
Q3
Recommend a work you particularly enjoy (book/show/film — anything goes). Why?
Chris: Often when we read, we hope to find answers. But some works let you glimpse the questions instead.
First, I'd recommend Asimov's Foundation series. It's a favorite of mine and many friends around me. Honestly, all of Asimov's work is excellent. These grand narratives set against the sweep of cosmic history offer different perspectives and scope at different stages of your life. The books aren't just science fiction — you can read them as history, even as biography. They reward rereading.
Another I've been reading recently that's been quite illuminating is Albie Sachs' The Strange Alchemy of Life and Law — a book about law, institutions, humanity, and even truth itself. The author is someone who completed his own answers, but readers might find the questions they need to solve.
And I strongly recommend a game: Human Resource Machine. With everyone talking about the so-called metaverse lately, as it draws nearer, could the shift in thinking patterns caused by technology普及 create new class divides in the next generation? This excellent game gives you a simple introduction to how machines think — stay current, keep evolving.
Q4
Why did you choose 5Y Capital's investment?
Chris: 5Y Capital's long-term focus on entertainment technology and the gaming market really impressed us. When our team first started fundraising in 2020, 5Y Capital partner Cheng Yu reached out to us. At the time, the capital market wasn't very familiar with game engine or Roblox-type companies. 5Y was one of the few institutions that had already done deep research on this market and begun positioning for it.
At our first meeting, we talked for hours about product, technology, and future development — including Yahaha's vision and 5Y's vision. You could clearly feel 5Y's deep understanding of and passion for the metaverse (still not a hot concept in China then) and real-time interaction. We signed the term sheet that same night. After investing, 5Y's post-investment support has been tremendous — they introduced us to many senior gaming industry practitioners and excellent companies. Many of the strategic considerations and adjustments we've made along the way came from deep exchanges with Cheng Yu.
The strong winds of change in real-time interactive content and the gaming market have just begun to rise, and the market will undergo massive transformation in the coming years. Facing the unknown, investors and companies need to grow and explore together. We're deeply grateful to have 5Y's full support on our journey.
Cheng Yu
Partner, 5Y Capital
Q1
What do you imagine for the future of this industry?
Cheng Yu: Starting over two years ago, we believed that with technological breakthroughs in 3D visualization, physics simulation, AI, cloud, and other fields, "virtualization of the real world" and "realization of the virtual world" would become two major threads of the future world. The sense of presence, realism, and immersion that virtual worlds bring is continuously improving, and will change how people consume and produce digital content, how they socialize, and even paradigms of physical consumption.
Games, as a "container" capable of carrying relationships between people and themselves, people and each other, people and machines, and people and the world at a higher dimension, are constantly breaking out of their original circles — new demographics are becoming gamers. Moreover, the very meaning and scope of "games" as a concept is evolving. As games, film, community, and social products converge, games may become the gateway to virtual worlds, or even the worlds themselves.
Excellent games "create dreams" for users, requiring tight coupling and efficient collaboration among professionals in technology, storytelling, art, and other fields — the barrier is extremely high. But if you look at text, images, video, and other media forms, content production and consumption have both gone through a spiral ascent of PGC and UGC, achieving creative democratization at specific moments due to technological breakthroughs, unleashing creativity and in turn driving UGC content consumption. Whether it's the freedom of in-game UGC content that Garry's Mod provided in the past, or UGC game platforms like Roblox, I believe the gaming industry may have reached this inflection point, where UGC will become another pillar of the industry's content ecosystem.
Q2
Why did you invest in Yahaha? What about the founder and team convinced you?
Cheng Yu: My first meeting with Chris was instant chemistry. We had deep consensus on our vision for virtual worlds, games, and UGC. We signed the term sheet that same day, and continued to increase our stake in subsequent rounds. By decoupling gameplay, digital assets, creativity, and technology, Yahaha will empower large numbers of ordinary people with aesthetic sensibility and creative ideas to make games or digital content that other users love, creating the opportunity to form a new kind of network effect.
This is extremely difficult. From a technical standpoint, the no-code experience users perceive places extraordinarily high demands on Yahaha's backend architecture and engineering capabilities. From a business standpoint, Yahaha aims to build its own content and consumption ecosystem in the global market — undeniably another monumentally difficult task. But through nearly a year of close observation, I have strong confidence in Chris and the team he's leading to achieve all of this. Very much looking forward to the official launch in a few months!
Yahaha Studios was founded in 2020. Its founding team comes primarily from Unity, and from the outset planned to build a 3D interactive content and social platform, completing multiple funding rounds within six months.
Founder Chris graduated from Shanghai Jiao Tong University with a computer science degree and earned his master's in computer science from Fudan University. He previously worked at Microsoft, EA, and Unity. Yahaha's two other co-founders previously served as executives in Unity's technology and platform operations departments, while other core team members come from leading tech and gaming companies including Unity, Microsoft, EA, and BAT.
"Yahaha will launch a platform for near-'zero-experience' creators, allowing creators to build multiplayer interactive content through no-code tools and publish with one click to Yahaha's platform and community, lowering the barrier to entry for traditional 3D real-time content — particularly games — across creation, testing, distribution, and monetization," said Yahaha founder Chris.
Chris explained that, put simply, what Yahaha is working toward is the democratization of content creation and consumption — Roblox and Unity were both pioneers in this regard.
Unlike Roblox and Unity, Yahaha will combine the respective strengths of platforms and engines, based on a certain worldview and a more multiverse-oriented concept, providing creators with creative scenarios and asset resources featuring different visual styles and gameplay mechanics. Yahaha envisions a future with a much larger creator base, capable of serving tens of millions of real-time interactive content creators. The hundreds of millions of different forms of content produced will transform the entire real-time interactive content market and even break down barriers between diverse cultures.
To date, Yahaha has established offices in Shanghai, China; Helsinki, Finland; and Seoul, South Korea, adapting and expanding into global markets while developing its product. The team has nearly 100 technical staff, with the product expected to officially launch in Q4 2021 on Windows, Mac, and mobile platforms.
Going forward, building on the foundation of native UGC users that Roblox has cultivated, Yahaha hopes to usher in a true UGC era through global co-creation among developers, enabling social and content consumption experiences to take place in a more creative, more immersive virtual world.
"We hope to combine characteristics of different models — engine technology, general protocols, content platforms, social products — to bring developers and users a low-cost, diversified, high-quality multifunctional platform that disrupts the traditional ecosystem where real-time content such as games is monopolized by game publishers and traditional channels," said Chris.
5Y Capital (formerly Morningside Venture Capital) currently manages approximately $5 billion across USD and RMB dual-currency funds. We believe that if the world starts believing in the crazy ones, the world will be a better place.
BEIJING · SHANGHAI · SHENZHEN · HONG KONG
