Earlier this month, Kobo was purchased by Japan’s Rakuten, Inc. for $315 million
E-readers, with their dull black and white screens, have typically been outshone by their flashier, shinier cousins in the tablet market—think iPads and Samsung Galaxies. Kobo, created in 2009 by Toronto-based Indigo Books & Music, Inc., was no different. It was largely overlooked in the Canadian tech industry as a very unsexy bit player.
Not anymore. Earlier this month, Kobo was purchased by Japan’s Rakuten, Inc. for $315 million, and now the Canadian start-up is suddenly being seen in a new light. “Being taken over shouldn’t be seen as a sign that Kobo is anything less than a great Canadian success story,” notes tech analyst Carmi Levy. “It should be seen as a sign that the already successful belle of the ball has been noticed, and has been asked to dance.”
Last quarter, Kobo sales jumped 219 per cent, while the company reports it has five million users worldwide. Kobo already controls more than 50 per cent of the Canadian e-reader market, and has a foothold of around 10 per cent in the U.S. Through Rakuten, the hope is that Kobo will gain access to markets in Europe, South America and Asia so it can further compete with industry heavyweights Amazon, Google and Apple. As Levy says, the time has come for the Canadian start-up to dance with the big boys.