The Start Up Story Of Tencent Holdings Ltd And Ma Huateng and Zhang Zhidong
Tencent (www.tencent.com) is one of China’s largest and most popular Internet Service Portal. It had its humble beginnings in November 1998 and since then has reached the zenith through years of hard work and client-friendly operating strategies. It was a big day for the company when it went public, as Tencent Holdings Limited on the main board of the Hong Kong Stock Exchange.
Tencent is bounded by its mission to improve the quality of human life through its different Internet services. The company is a one-stop center for mobile, telecom services, online advertising and value-added Internet. The popular Internet platforms of Tencent include QQ.com, Paipai, Tenpay, Qzone, 3g.QQ.com, and some other smaller sites. These cover the Internet user’s different requirements like information, entertainment, e-commerce, communication etc. The development of Tencent has influenced the communication and lifestyle of the Chinese. Tencent has its future program ready. It is busy acquiring patents for e-commerce, online payment services, gaming, and search engines all these would further expand its business. It is an active participant in charity programs and the charity goes towards improving youth education, care of the disadvantaged, assistance to the impoverished etc.
Tencent Holdings Ltd was co-founded by Ma Huateng and his college mate Zhang Zhidong as a software company. The company launched OICQ in the February of 1999- a copy of ICQ instant messenger software. The product had a tremendous response and saw an unprecedented user growth. It later changed the name OiCQ to QQ due to legal problems with the ICQ. IDG and PCCW both had funded the company in 1999 and later a South African media company –Naspers also purchased 46.5% of the business. Currently, IDG has a 7% ownership and the Naspers has 46.5 % and the rest 46.5% is owned by the founders and a group of Chinese entrepreneurs. Tencent has always striven without resting on their laurels. They dabbled in premium membership schemes, web advertising. The mobile value-added services of the site was a real success and this began with the launch of Mobile QQ in May 2000. The mobile offerings of Tencent included chat, mobile music, and pictures, mobile news, mobile games, ringback tones to name just a few.
Tencent rose to become a leader of Service providers in China. The timing couldn’t have been more convenient as this was the time when Chinese mobile operators (China Mobile and China Unicom) started allowing service provider. It started raking in profits in 2001, got enlisted in the Hong Kong Stock Exchange. It enjoyed the tremendous response from it subscribers and were sometimes finding it difficult to meet the requirement. Founder Ma Huateng had a net worth of 100 Million dollars around that time. As it is with the success stories Tencent had its own hurdles as mobile operators started implementing stringent regulations as they wanted a greater share of the stakes. Tencent diversified and started social networking and online gaming services. They also incorporated the virtual goods model, developed QQ show, developed in-house casual games, board, and card games. It worked for the improving the QQ.com into a top site thus growing its advertising business. Tencent is an ambitious company as can be concluded from its forays into developing search engines, an e-commerce site and so on.