9-Year-Old YouTube Star Ryan Kaji Opens Virtual World on Roblox

“Ryan’s World” in Roblox will offer interactive areas and activities for players, including a racetrack, a school, a city center and a “fun zone,” where players can challenge each other in obstacle courses. The world will also feature characters from Ryan’s TV shows and videos such as Red Titan, a superhero version of Ryan, and Combo Panda, a headphone-wearing cartoon animal that plays and reviews games.

Ryan, whose real name is Ryan Guan, will occasionally participate, giving fans a chance to meet him virtually.

YouTube stars with big audiences, especially among younger viewers, are receiving more attention from entertainment companies, toy manufacturers and other businesses seeking to leverage their fame into new content and products.

Retail chains now carry a vast array of toys from major kids-focused YouTube channels, said Brendan Gahan, chief social officer of ad agency Mekanism Inc. “I firmly believe that in a few years these brands will rival that of Sesame Street—they’ve got the mass appeal, which is likely bigger than Sesame Street in most cases now—they just haven’t monetized it through as many avenues. I think you’ll see that change quickly.”

Pocketwatch Inc., a Culver City, Calif.-based entertainment company that does business as Pocket.watch and manages the Ryan’s World business off of YouTube, has been thinking about virtual worlds as a way to create new versions of franchise theme parks, said

Chris Williams,

its founder and chief executive.

“We don’t need to go buy real estate, but focus on where kids actually are today, which is platforms like Roblox,” Mr. Williams said.

The “Ryan’s World” franchise is on track to surpass $500 million in retail sales from the launch of its consumer-products business in 2018 through the end of 2020, including around $250 million this year, Mr. Williams said.

With Roblox, “Ryan’s World” will earn revenue when players purchase “gems” that they can exchange for virtual gadgets and other in-game items. Players can also earn gems during gameplay, Mr. Williams said.

Roblox takes a 30% cut of sales on its platform, which hosts millions of games. It averages 36.2 million daily users, according to a filing last month to go public. Its nearly seven million developers are on track to make $250 million this year, up from $110 million in 2019; its top earners net more than $1 million a year, the company said.

“Ryan’s World” in Roblox world will also promote other parts of the Ryan empire: A race car in the game is a toy for sale in real life from FAO Schwarz, for example, and new characters are likely to arrive as they are introduced in programming elsewhere.

One challenge for “Ryan’s World” will be staying relevant as its young star grows older, said Mr. Gahan, the Mekanism executive.

Ryan’s parents have tried to account for that by creating animated characters that can serve as the basis of new shows, games and products, while allowing Ryan to pursue his new interests in science, gaming and design as he grows older, said Shion Guan, his father.

“I think we can expand the range of the content—similar to how Disney has Disney and Disney Jr.,” Mr. Guan said.

Mr. Williams, a former Disney executive, said Pocket.watch aims to replicate the success of “Ryan’s World” with its other YouTube creators. Toys and costumes for a creator-franchise called “Love, Diana,” for example, are now available at Walmart in the U.S.

Consumer products account for 54% of the revenue generated by Pocket.watch across its roster of 12 creators, with content sales and licensing at 23% and advertising—excluding ads sold by platforms such as YouTube—at 22%. “Ryan’s World” has the largest business of the group, Mr. Williams said.

“It’s helped set the blueprint for us,” Mr. Williams said.

Write to Sahil Patel at sahil.patel@wsj.com