SEA (formerly known as Garena)

[cyclone]

The Tencent of Southeast Asia Isn't Really Like Tencent at All

By Yoolim Lee
October 12, 2017, 5:00 AM GMT+8

Singapore’s Sea Ltd. initially modeled itself on Chinese internet colossus Tencent Holdings Ltd. and is often called the Tencent of Southeast Asia. Now that Sea has filed for an initial public offering and given a peak at its financials, the resemblance is starting to break down.

The company, seeking to raise about $700 million as it goes public in New York, does offer games and digital entertainment like Tencent. In fact, the Chinese company licenses hit games like League of Legends to Sea, and owns about 40 percent of the smaller firm’s stock.

But where Tencent is immensely profitable, Sea is immensely unprofitable -- with signs that losses may grow deeper. Tencent’s net profit margin in the first half of the year was 31 percent, with net income of $4.76 billion on revenue of $15.5 billion. Sea has a negative net margin of 84 percent, with a loss of $165.2 million on revenue of $195.5 million.

More details in https://www.bloomberg.com/news/articles/...ent-at-all

[weijian]

Private equity is about "what is possible" and public equity is about "what is probable".

IMHO, SEA's game biz looks to have the best bang of the buck for success. It's other focus like e-commerce/message/payment systems are all network-effect type of businesses and generally is "winner takes all". I suspect if one isn't big now, most probably it would never be big since the big boys naturally have their size as the moat.

Welcome to the public equity space (soon)!

[BRT]

give them a few years, what's left may just be garena. at least sg can boast of entrepreneurship success with tech unicorns like sea and razor.

[BRT]

Singapore's game startup Sea raised US$884m in New York IPO

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[NEW YORK] Singapore's Sea Ltd, Southeast Asia's most valuable startup, raised about US$884 million in its initial public offering in New York.

The company sold 59 million American depositary shares for US$15 apiece, according to a statement Friday, offering more shares and pricing them above its initial range of US$12 to US$14 each. The total amount may be more than US$1 billion if an option to sell additional shares is exercised, according to a person familiar with the matter, asking not to be identified because the matter is private.

The games company is backed by Tencent Holdings Ltd and has benefited from the Chinese company's support. Sea licenses games from Tencent, which also holds a stake of about 40 per cent in the smaller company. Investors are scooping up Sea's shares despite rising losses at the company as it diversifies into e-commerce and payments. Sea had a net loss of US$165.2 million in the first half of the year on revenue of US$195.5 million.

It was valued at US$3.75 billion in its 2016 fundraising and will surpass US$4 billion with the IPO.
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http://www.businesstimes.com.sg/technolo...w-york-ipo

"Sea is a future-looking investment," Kai-Fu Lee, founder of Beijing-based Sinovation Ventures, said before the offering. "Investors are betting that it can become the 800-pound gorilla that will make all the money it may have lost."
>>>>>>> okay man -_-

[weijian]

Generally, i stand on the end of those whom have skin in the game (ie. the shortists)

Shorts Face Off With Analysts Over Marquee Singapore Startup

Sea Ltd., operator of Southeast Asia’s biggest gaming platform, has had a rough start as a public company.

The much-heralded Singapore-based company raised about $1 billion in an October initial public offering led by Goldman Sachs Group Inc., Morgan Stanley and Credit Suisse Group AG. The shares have tumbled almost 20 percent since then and losses are widening. When the company reports results Wednesday, it’s projected to lose $201 million in the three months ended in December, more than double the net loss a year earlier, according to data compiled by Bloomberg. Revenue probably increased 75 percent to $154.5 million.

https://www.bloomberg.com/news/articles/...re-startup

[weijian]

Private equity is about "what is possible" and public equity is about "what is probable".

IMHO, SEA's game biz looks to have the best bang of the buck for success. It's other focus like e-commerce/message/payment systems are all network-effect type of businesses and generally is "winner takes all". I suspect if one isn't big now, most probably it would never be big since the big boys naturally have their size as the moat.

Welcome to the public equity space (soon)!

I am terribly wrong (of course). What is possible, became possible - low probability but large payoffs - a classic asymmetric bet which I think I will take much time to learn.

Here’s how Lazada lost its lead to Shopee in Southeast Asia

In 2018, however, Shopee seized the opportunity to launch an offensive in light of Lazada’s stagnation in Southeast Asia, led by CEO Chris Feng. Today, Shopee’s market capitalization has exceeded USD 120 billion. It is said by Shopee’s employees that 80% of Sea Limited’s stock price is supported by Shopee’s growth potential, while 80% of Shopee is supported by Feng.

https://kr-asia.com/heres-how-lazada-los...art-1-of-2

[Wildreamz]

Google Trends, global search interest:


Signs of Shopee's ascend over Lazada happened in early 2018 (Lazada's decline); some would argue (simply by comparing relative growth) was obvious in early 2017. Instead of looking at current market share dominance and assume status quo will likely remain; I find trajectory of growth, and qualitative assessment (Shopee is much more feature-rich (e-wallet, coins etc.), iterating much more quickly, much more aggressive with price-matching coupons/discount, and much less aggressive at clamping down on "OEMs" etc.), much better predictor of future market dominance.

Peace.

(Not vested)

[specuvestor]

I missed investing in SEA though I've met the IR / strategist a few years from 2016 when it was bleeding money and looking to IPO. I couldn't see how shopee can upset the Lazada backed by Ali Baba and the indonesian incumbents Tokopedia and Bukalapak that knows the country well which focuses on high volume low margin model. And after Ronaldo's advertisement I thought I must be right

Shopee has indeed executed much better than I can ever imagine. Worst part is I'm still not sure why even with weijian's article

Private equity is about "what is possible" and public equity is about "what is probable".

IMHO, SEA's game biz looks to have the best bang of the buck for success. It's other focus like e-commerce/message/payment systems are all network-effect type of businesses and generally is "winner takes all". I suspect if one isn't big now, most probably it would never be big since the big boys naturally have their size as the moat.

Welcome to the public equity space (soon)!

I am terribly wrong (of course). What is possible, became possible - low probability but large payoffs - a classic asymmetric bet which I think I will take much time to learn.

Here’s how Lazada lost its lead to Shopee in Southeast Asia

In 2018, however, Shopee seized the opportunity to launch an offensive in light of Lazada’s stagnation in Southeast Asia, led by CEO Chris Feng. Today, Shopee’s market capitalization has exceeded USD 120 billion. It is said by Shopee’s employees that 80% of Sea Limited’s stock price is supported by Shopee’s growth potential, while 80% of Shopee is supported by Feng.

https://kr-asia.com/heres-how-lazada-los...art-1-of-2

[weijian]

The gist of the article seems to suggest that it was Lazada who gave it to Shopee. And a huge majority of Shopee staff came from Lazada! Of course, that doesn't take anything away from Shopee in terms of their execution to take advantage of Lazada's missteps.

[CY09]

https://finance.yahoo.com/news/sea-aims-...43762.html

Sea Group is raising cash to fund its expansion.

For those who follow Sea Group, Shopee pay has been on an aggressive marketing spree with $1/$2 discount with no min spend if consumers pay with shopeepay at shops. You can find the discount coupon in shopee app under the 1 cents deal (can use shopee coins as "1 cent"). In addition, using shopeepay in Singapore lets users earn 2% rebate in the form of shopee coins. My friend showed that at Philippines, the rebate was 5% for using shopeepay.

The digital payment services in SEA region is getting interesting with Shopee (Sea Group) challenging Grabpay.