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Crunchyroll is one of the biggest streaming sites today. The website that was founded by a group of graduates from University of California, Berkeley became a massive source of entertainment for the manga and anime enthusiasts today. The site has a not so honorable start since they started with illegal activities since they started streaming unlicensed videos.
With the proper management and operation, the company was able to steer into the right direction and become the largest licensed anime streaming site. Although they are now a giant streaming site owned by Sony, it took them years to get to where are today. The company had a great story of how they were able to get from being an illegal site to becoming $1.175 billion worth company.
Crunchyroll Started As An Illegal Streaming Website
Crunchyroll initially started as an illegal website streaming different anime multimedia in 2006. The company started out pirating anime series on the web. They are not a big company who started out with an enormous amount of budget. Crunchyroll started out like the websites Kiss Anime, 9Anime, GoAnime, etc.
The site was founded by a group of graduates from the University of California, Berkeley in 2006. The site was established as for-profit video streaming sites that specialize in hosting contents from the East Asian countries. Although there are massive Asian videos on the site, it mostly contains anime videos. Due to its popularity, it's a great investment opportunity and attracted tons of investors.
Two years after it was first established, Crunchyroll got a hold of about $4.05 million of capital investments in 2008 from the venture capital firm Venrock. At the time, there were already licensed streaming sites that already existed. Anime distributors and licensors Funimation and Bandai Entertainment criticized the investment deal since the Crunchyroll still allows unlicensed copies of copyrighted titles on their site.
With the negativities and criticisms being thrown at them, the management of Crunchyroll decided to start securing legal distribution rights to make things fair and to better serve their visitors.
Transitioning To A Legal Streaming Site
The streaming company is not the first streaming company to broadcast anime episodes since Funimation was already founded at the time. However, they’re one of the go-to website for the anime enthusiasts outside Japan since they have massive collection of videos on their site. With the massive traffic that they are getting on a daily basis, it is not surprising that the site is making enormous amount of money.
A lot of licensed anime distributors complained to since the site is becoming increasingly popular. With the intention of providing content to their viewers in a more appropriate way, Crunchyroll started obtaining rights to legally distribute anime contents. The site first partnered with the company Gonzo to grow their list of titles.
The site finally announced in January 2009 that they secured a deal with TV Tokyo to stream episodes of Naruto Shippuden on the site. The company stated that they have acquired the exclusive global rights to stream the episodes. The company stated that they are starting to remove and ban all of the copyright-infringing contents on the site.
Since then, Crunchyroll has started only hosting contents that have legitimate distribution rights. The following year, the site announced that they have acquired the rights to the North American DVD release of 5 Centimeters Per Second. This was the first ever licensed DVD that the company released.
About four years since they started to transition to legal distribution, the company secured another deal from Kodansha in 2013. The company obtained rights to about 13 manga titles that included popular franchises such as Attack on Titan and Fairy Tail.
Partnerships And Massive Expansion In The Global Market
The Chernin Group (known today as the TCG) acquired a majority stake at the company for about $100 million. Despite acquiring majority stake at the company, TCG maintained that TV Tokyo will retain a significant control of the company. TCG further enhanced the service of the site as they decided to form a joint venture with AT&T in 2014 to acquire more over-the-top video services. The two companies both invest about $500 million each for the said venture.
The following year, Otter Media came into the picture to help the company branch out. Otter Media started the umbrella company called Ellation wherein the site started to offer a subscription-based video services. The umbrella company included the services of Crunchyroll. Just a few months after launching the subscription based service; the site had about 700,000 subscribers who are paying for their premium subscription.
In the next five years, the company went on to further collaborate and partner with different companies including Funimation. The partnership stipulated that Funimation would be streaming some of Crunchyroll videos and Crunchyroll would be streaming some of Funimation videos in return.
Rumors of Sony acquiring the site began in August 2020 and was later on announced the acquisition finally happened as Funimation and its owner Sony announced that they have acquired Crunchyroll for $1.175 billion. The acquisition seems to be a success since two years after, Sony announced that they will be renaming Funimation Global Group, LLC to Crunchyroll, LLC in March 2022. The company further stated that they will be phasing out the Funimation brand in favor of Crunchyroll.
Sources: Zippia, Anime Motivation, Sci Fi Japan