Forget about everything, remember Tencent

You will be familiar with Facebook, Microsoft, Alphabet, Apple and Amazon, but how familiar are you with Tencent, the Chinese number 6 in the global elite tech club? You will be very familiar, in some time, even if you’re not operating in China, Tencent’s home country. And here is why.

Pony Ma

Tencent started off with messaging apps, WeChat and QQ, that serve almost the entire Chinese population. People chat, call, order food and goods/services, pay bills, flirt, watch videos and much more, using what used to be a copy of an Israeli instant messaging app. “Pony” Ma Huateng, the founder, is a shy and modest provincial. A famous picture, taken in 2015 with the Chinese president Xi Jinping, shows Ma with people such as Tim Cook and Jeff Bezos, who are comfortable with presidential honors & spotlights. In the picture, Ma was looking at his shoes.


Let’s talk figures. Tencent’s market cap is USD 511 billion, 2016 revenues were 21.9 billion, net profit was 5.9 billion. Typical investments are, obviously, in WeChat developments, gaming and… mobility. Tencent’s strength is the effect of a unique combination : a visionary leader, Ma, a strong business operator, Martin Lau and the company’s capacity to reinvent itself. In 2011, the company’s reputation was that of an uninspired copycat. Huateng decided to change that and invite 72 industry experts in a series of closed-door meetings, referred to as the “Conference of the Gods” by the staff. The expert’s harsh and blunt feedback about Tencent gave its leaders the motivation to go for a complete make-over that led to the creation of WeChat. Tencent also started to play a new game itself : sell off loss-making businesses to your competitor and subsequently invest in that competitor. It allowed them to stop investing in non-core, have experts do the job better and make money out of it.


Tencent’s next phase is that of mergers and acquisitions. They missed acquiring WhatsApp because of Ma’s back surgery (Zuckerberg was happy to close the deal while Ma was at the hospital), but Supercell (a Finnish mobile gaming company), was a success, and so were an impressive number of participations in big names : Uber, NIO, Mobike, Tesla and Didi, to name some. One of them however is more interesting than the other ones. It’s Future Mobility.


Future Mobility is a Chinese start-up, producing EV’s under the name “Byton”. Chinese? Yes and no… the people behind Byton are former Tesla, BMW and Nissan executives. Interesting is that the brand is not aiming for the Chinese market, which is what we’ve heard NIO repeating so often that we’ve stopped believing it, but openly states that it wants to be successful in the US and in Europe. Unsurprisingly, Byton is doing the Tesla /NIO thing, making exciting cars that go fast and far and look futuristic, but (here’s the hook), Byton cars will be social media interfaces on wheels.

Be prepared!

We’ll be hearing a lot from Tencent. 2017 has been great, again, and news about Tencent investments are daily business in Chinese newspapers. There’s very little reason to believe that Tencent will stay out of the lives of people in EU and US. Your first EV or self-driving car will definitely have a piece of China in it, and it’ll probably be Tencent’s.

Authored by: Yves Helven