The Rundown - Deep Dive: How Labubu Turned Pop Mart Into a Global Toy Empire

Episode Date: June 28, 2025

Pop Mart’s Labubu dolls have exploded into a global phenomenon, going viral on TikTok, selling out in seconds, and commanding six-figure prices at auction. In this episode, we explore how a quirky $15 blind box toy became the crown jewel of a $43 billion business. From artist-driven IP to a booming adult collector market, Pop Mart is reshaping how China exports culture. But with rising regulation and fears of a blind box crackdown, could Labubu’s moment already be peaking?This video is for informational purposes only and reflects the views of the host and guest, not Public Holdings or its subsidiaries. Mentions of assets are not recommendations. Investing involves risk, including loss. Past performance does not guarantee future results. For full disclosures, visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Public.com/disclosures⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠.

Welcome back to the rundown for another weekend deep dive. Today, we are talking about a plush toy that is taking over the world, Labubu's. You guys have probably seen these little monsters on your social media feeds over the last few weeks. People are obsessed with these collectible toys, and they're forming lines around the block for new releases and dropping thousands of dollars to buy the rare ones. So in today's episode, we're diving into the Labubu phenomenon. We'll tell you about the artists who created them, the Chinese toy toys. a company that turned them into a gold mine and why the biggest threat to this empire might not be a trade war, but the Chinese government itself.

We got a great show for you today. Let's dive in. Laboubu is the brainchild of a Hong Kong-based artist named Cassing Lung. About a decade ago, Lung published a picture book trilogy called The Monsters, inspired by Nordic mythology and filled with charming, yet slightly eerie creatures. And one of those characters in that book was Labibu, and the design of that character struck a chord with the audience. So Lang started hand-making figurines of Labubu's for the hardcore fans. Then in 2019, the character caught the attention of Pop Mart, a Beijing-based toy company known for their addictive blind box business model.

Cassing Lung ended up signing an exclusive licensing deal with Pop Mart in 2019, which gave Popmark the exclusive rights to produce and distribute Labibu toys and merchandise. And since signing that deal, Pop Mart has released over 300 Labubu variations, ranging in price from $15 to nearly $1,000 for premium editions. They even have mega versions of these toys, like a four-foot-tall Labibu that recently sold for a record $150,000 at a Beijing auction. And it seems like the Labubu craze is starting to hit a peak right now, especially in the U.S. because of going viral on TikTok and celebs jumping in on the trend. Duelipa, Rihanna, and even K-pop star Lisa, who recently starred in White Lotus, have showed off their Laboo-Dolls on social media like their fashion accessories.

And even old-school celebrities like Brad Pitt is getting in on the craze. He was unboxing a Labibu in a promotional TikTok video for his new F-1 movie. That's when you know a toy has gone mega-viral and is starting to impact culture. And the company behind these toys, Pop Mart, is cashing in right now. So let's talk about it. Popmart might not be a household name in the U.S. just yet, but they are one of the biggest toy companies in the world. The company has a market cap of over $40 billion. And to put that into perspective, their market cap is more than triple that of toy makers Mattel and Hasbro,

which have a combined value of just below $17 billion. So just shows you how massive Popmart is, and their stock has been on fire this year, jumping more than 200% so far. By the way, their stock is available to trade on the public app under ticker symbol P-M-R-T-Y. We'll put a link in the description if you want to check that out. And see, Pop Mart is different than other toy companies in many ways. For one, they're tapping into storytelling by building a universe of original characters by partnering with independent artists.

Casting Lung is the recent breakout star with Labooboos, but Pop Mart has signed dozens of other artists as well. And then we have to talk about Pop Mart's secret sauce, their blind box business model. See, when you buy a toy from Popmart, you don't know which character you're going to get until you open the box. You know, it's kind of like buying a pack of Pokemon cards or sports cards. There's like an element of thrill and surprise to the unboxing. And these unboxingings are filmed and shared on social media, racking up millions of views, which gets even more people wanting to participate in the unboxing, and then people buy multiple of these boxes in hopes of pulling a rare version.

So the business model is perfect for virality and a bit of addiction. Popmart has built a Pokemon-style business model where fans collect characters and hunt for rarities and build their entire personalities around these characters. And that has turned Popmart into a massive business today. In 2024, Popmart had 13 different IP lines that each did over 100 million yuan in revenue. The Monsters line alone, which includes Labubu, brought in $420 million. Pop Mart's other top lines like Molly, Skullp Panda, and Crybaby, pulled in $630 million combined at today's exchange rate. So the company isn't just a one-hit wonder.

They've shown that they can identify upcoming artists and bring their next big hit to the toy market. Now, going back to the Monsters Line, which includes the viral Labooboos, it's the breakout hit right now with revenues growing 727% from 2023 to 2024. The Monsters Line went from making just 6% of Pop Mart's total revenue to 23% last year. And this has caught the attention of Wall Street.

The investment bank Morgan Stanley recently called Pop Mart one of the fastest growing global brands ever. And their growth isn't just contained in China. Their toys have now exploded in popularity beyond China to places like the U.S. In fact, Morgan Stanley predicts that Pop Mart's overseas sales will surpass sales in China this year in 2025. And they estimate that Pop Mart's total revenues will store to $6 billion by 2027, which would be a 500% jump from 2023.

So the numbers that Pop Mart is putting up are insane, and they're doing all of this despite the threat of tariffs and trade wars. Labubu's global rise is coming at a time when U.S. and China relations are arguably at their most strained in decade. The U.S. government is cracking down hard on Chinese companies. TikTok is facing a nationwide ban. Timu and Shian have seen demand in the U.S. plummet due to tariffs and the elimination of the de minimis trade loophole.

and Chinese EV companies have been boxed out of the U.S. market because of massive tariffs. But Pop Mart has slipped through the cracks, and they're thriving right now. And what makes us even more interesting is that U.S. companies are starting to struggle in China. Apple's been losing grounds to Huawei, B.Y.D. overtook Tesla in China, and even Starbucks is getting beat by homegrown rivals like Luckin Coffee. These American brands used to dominate the Chinese market, but now Chinese brands are starting to dominate the U.S. market. It's a fascinating flip happening right now, and Pop Mart is one of the best examples of that. But is the hype sustainable, or is this just Beanie Babies all over again?

Believe it or not, we've been through multiple hype cycles when it comes to toys in the past. The best example of this is Beanie Babies. Now, some of you guys might be too young to remember this, but Beanie Babies were massive in the late 90s. At their peak in 1998, the company behind Beanie Babies, Thai Inc, reportedly sold more than a billion dollars worth of Beanie Babies. And people weren't just collecting Beanie Babies. They were investing in them. There were some people that genuinely believed that these things were going to be a ticket to early retirement. People were taking out second mortgages to buy rare collectibles.

I mean, it was absolute madness. But then by the year 2000, the bubble burst. The market was flooded with Beanie Babies and the illusion of scarcity was gone. The Beanie Babies that were selling for half a million dollars at their peak were suddenly worth like $10. The whole thing became a national punchline. And beyond just Beanie Babies, we saw this again more recently with things like funco pops and sports cards during the pandemic. In fact, I think the best recent example has to be the craze around NFTs. Not too long ago, JPEs of cartoon monkeys from the Bored Ape Yacht Club were worth over $400,000 at their peak in 2022.

I'm talking that was the floor price of these board apes. Some of the rarer ones were being sold for millions of dollars. But eventually that bubble also burst and the floor price today for a lot. a board ape is $25,000, which honestly is still pretty wild to me, but the price is down more than 90% from its peak back in 2022. So naturally, everyone is wondering the same thing. Is this going to happen to Labuboos? I mean, in my opinion, I don't see how this ends any differently. Once the market becomes flooded with these toys and the hype fades and people move on to the next thing, the prices are probably going to fall. So the amount that I paid for my Labibu's this

week, there's a good chance that they're not going to be worth that much in a few months. But the bigger issue for Pop Mart right now isn't that Labibu's might become irrelevant? They're more concerned about the crackdowns by the Chinese government. The biggest threat to Pop Mart's business isn't Labubu's losing relevance on TikTok or trade wars with the U.S. It's actually the Chinese government. Like I mentioned earlier, Pop Mart's business model is centered around mystery boxes, and this business model is drawing negative attention in China. Shares of Pop Mart recently took a hit after Chinese state media called for tighter regulations to protect miners from impulse purchases. See, in recent years, China has begun cracking down on the blind

box model, citing concerns about addictive behavior and its similarities to gambling. The country now bans the sale of blind boxes to children under eight, and across Asia, momentum is building for tighter rules, with Singapore capping the value of mystery boxes. Now, Pop Mart insists that its products are aimed at kiddults, meaning young adults and not kids. But the regulatory scrutiny could escalate if prices keep climbing and the resale market of Labubu start looking more like meme coins. The risk to Pop Mart here is real. State-run media in China holds a lot of influence. A good example of that is Apple. They found out the hard way back in 2013. A single investigative segment on Chinese state media accused Apple of arrogance toward Chinese customers and the brand

faced immediate backlash. Apple's CEO Tim Cook publicly apologized in less than two weeks. Another example of a crackdown in China was the video game industry. The Chinese government saw video games as addictive behavior putting youth at risk. So back in 2021, Beijing enforced strict playtime limits for kids under 18 and paused approval of new video games for eight months. And since then, China has proposed rules to reduce in-game spending and a crackdown on incentives that reward gamers for behaviors like logging in to play daily. The news of these video game crackdowns in China have wiped out billions of dollars in market cap of Chinese gaming giants like Tencent and NetEase. So it just goes to show you how vulnerable these companies are to Chinese

government actions. And that's why Pop Mart is more worried of Beijing than they are of D.C. So what's the takeaway here? Well, Popmart has found a way to sell toys in 2025 using a mix of unique IP, scarcity, and virality. And this formula is now working beyond just China and catching fire in the U.S. with the popularity of Labubu's. But we've seen this happen before, with Beanie Babies and NFTs, that the hype for these things don't last long. But I'm sure Pop Mart knows this as well, and they're already working on their next viral hit.

But the bigger question for them, though, is if the Chinese government will pull the plug on them first. In the meantime, if you guys are looking to buy a Labibu and having a hard time getting them, let me know. I'll give you a good deal. Well, all right, guys, that's it for today's weekend, deep dive. If you guys enjoyed today's episode, consider sharing it with someone that has a Labubu or can't stop talking about Labubu's.

If you guys want to see my personal Labibu collection, check out the video version of this podcast on YouTube or Spotify. As you can see, I currently have three that I got for my daughter. And I think I'm going to stop there. I'm almost embarrassed to say how much I spent on these. Actually, let me know in the comments how much you think I spent on these three Labubos. And also let me know if you think the hype around these things will last. And while you're at it, don't forget to subscribe for the podcast and hit us with a five-star rating. All that engagement really does help us out, and it helps other people find the show.

Thank you guys so much for listening. Shout out to Mike and Connor. For all the help behind the scenes, and we'll see you guys back here on Monday.