Tencent + Supercell = Success!


Some of you are familiar with computer games right? Only they aren’t necessarily ‘computer games’ anymore. They are games you can play on any smart device. The computer games of yesterday – Pac Man, Tron, Frogger and the like, were played as arcade games or as games on a console such as the one provided by Atari. Today, you have the Xbox, Wii, PlayStation, and other such consoles. Companies develop games for these devices, but there are also companies who develop games for mobile devices. The whole industry – of creating and playing games is called ‘Gaming’. There is a lot of money to be made here IF you play your cards right (hahahaha!).

Supercell Oy is a Finnish (from Finland) game developing company that makes some popular games such as Clash of Clans and Clash Royale. I have some experience with Clash Royale – it can be super addictive!

What makes it so successful? There’s a social aspect where you and your friends can be in a clan together and play against others and collect rewards for the Clan. There’s individual performance where you unlock special players for your self, There’s an aspect that gets you to log in every day to unlock new players. It’s got it all! And now one of the largest Internet companies in Asia, Tencent, owns it.

Tencent bought most of Supercell in the second half of 2016, for $8.6 billion! Yes, that’s BILLION! That means that Tencent thought that Supercell was worth about $10 billion in total. Why did they do this? Gaming is a big industry, and Tencent, one of the two largest internet companies in China, wanted to expand its reach into the gaming industry abroad.

How did Tencent manage to get the deal done? Part of making a deal with anyone is to show them how much you like their product. When Tencent decided to explore buying a majority stake in Supercell, their President and Chief Strategist, Martin Lau, flew to Finland despite a raging fever. It is said that he played Clash Royale a lot from when he decided to check them out, to when he met them. So much so in fact, that when he walked into their offices, he was ranked the 97th best player in the world in Clash Royale. He told the Supercell CEO, Ilkka Paananen that.

The Supercell CEO called in one of the Supercell gamers who challenged Martin Lau to a game. Martin Lau won, and I think his enthusiasm helped, because soon after, Supercell decided to sell a majority stake to Tencent! It definitely pays to do your homework!

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