The Success Story of Ma Huateng

  • lauren DeAlmeida
  • August 11, 2021
  • 0
Success Story of Ma Huateng

Image Courtesy of Paul Yueng/Bloomberg

Ma Huateng is the founder, chairman, and chief executive officer of Tencent Holdings Limited. Tencent is one of the largest Internet and technology companies, and one of the biggest investment, gaming, and entertainment conglomerates in the world.

Commonly, Ma Huateng is also known as Pony Ma. Ma uses the nickname Pony. The name was derived from the English translation of his family name Ma which means “horse.”

The Chinese billionaire business magnate was born on October 29, 1971. Ma was born in Chaoyang, Shantou, Guangdong. Ma Chenshu, his father, was a port manager in Shenzhen. At times, Ma Huateng used to accompany his father to work.

He is an incredible entrepreneur who has created Asia’s most valuable company. In fact, Tencent is China’s biggest mobile instant messaging service. WeChat app was made by Tencent. Furthermore, the company’s subsidiaries provide payment systems, media, smartphones entertainment, internet-related services, value-added services, and online advertising services, both in China and globally.

In fact, Ma Huateng barely appears in the media. He is known for his secretive lifestyle. Reportedly, Ma Huateng owns property in Hong Kong and art pieces worth USD 150 million.

Huateng’s education

In 1989, Ma Huateng joined the Shenzhen University. By 1993, he successfully graduated with a bachelor’s degree in computer science.

Huateng’s early career

Ma Huateng’s first job ever was with China Motion Telecom Development. Actually, China Motion Telecom Development is a huge company in China who deal with supplying telecommunications services and products. So, Huateng was in charge of developing software for pagers. As a matter of fact, Ma Huateng was so skilled that he reportedly earned $176 per month.

Later on, Huateng left China Motion Telecom Development to join Shenzhen Runxun Communications Co. Ltd. He joined in and took over the research and development department for Internet calling services.

The beginning of Tencent

In 1998, Ma Huateng joined hands with four other classmates. Together, they established Tencent. Ma Huateng was a co-founded. Huateng participated in a presentation for ICQ. ICQ was the world’s first Internet instant messaging service, founded in 1996 by an Israeli company. Ma Huateng was inspired by the ICQ idea.

Later, Ma and his team launched in February 1999 a similar software, with a Chinese interface and a slightly different name – OICQ. By the end of 1999, the product quickly became popular. In fact, it gained more than a million registered users. Soon, OCIQ became one of the largest such services in China.

Since Tencent’s prized service OICQ was offered free of charge, the company looked to venture capitalists to finance its growing operational costs.

Ma Huateng turned to Hong Kong’s telecom carrier Pacific Century CyberWorks (PCCW) and  United States investment firm, IDC in 2000. They bought 40 percent of Tencent’s shares for USD 2.2 million. The pager market was declining at that time. Therefore, Ma Huateng improved the messaging platform by allowing QQ users to send messages to mobile handsets. Later on, almost 80 percent of the company’s revenue came from deals struck with telecom operators who agreed to share message fees.

AOL arbitration

AOL is a short form for America Online. It bought ICQ in 1998. Later, the company filed an arbitration against Tencent with the National Arbitration Forum in the United States. AOL claimed that OICQ’s domain names OICQ.com and OICQ.net were in violation of ICQ’s trademark.

At that point, Tencent lost the case and had to relinquish the domain names. Ma Huateng decided to Ma change the name of the software to QQ (with “Q” and “QQ” used to stand for the word “cute”) in December 2000.

Business expansion

Ma decided to expand the business portfolio of Tencent after the AOL case. Tencent released its own portal (QQ.com) in 2003. In addition to that, the Tencent company made forays into the online games market during the same year.

In 2004, Tencent became the largest Chinese instant messaging service. As a matter of fact, it held 74 percent of the Chinese market. This inspired Ma Huateng to list the company on the Hong Kong Stock Exchange. In June 2004, the Tencent company raised $200 million. Ma quickly became one of the richest people in China’s telecom industry. Later in 2004, Tencent expanded further and launched an online gaming platform and started selling virtual goods to support the games published on that platform (weapons, gaming power), as well as emoticons and ringtones.

Ma Huateng did not stop there. In 2005, Tencent launched the C2C platform Paipai.com.  Consequently, Tencent Holdings Limited posed threat to Alibaba as it became a direct competitor to e-commerce giant Alibaba.

In 2007, Time magazine named him one of the world’s most influential people.

In 2009, Ma spoke to China Daily about the founding of Tencent. He said: “If I have seen further, it is by standing on the shoulders of giants,” paraphrasing a quote attributed to Isaac Newton and referencing the similarities between ICQ and OICQ.

“We knew our product had a future, but at that time we just could not afford it,” Ma remembered. In order to solve the problem, Ma Huateng asked for bank loans and even talked about selling the company.

Ma Huateng mimics Microsoft

Ma decided to mimic Microsoft later on. In 2010, he created two competing teams of engineers and charged them with creating a new product. After two months, one team presented an app for text messaging and group chat. They named it WeChat. WeChat was launched in January 2011.

In 2014, Time magazine named him one of the world’s most influential people yet again.

As of 2015, WeChat (微信, Weixin), is the largest instant messaging platform in the world, used by 48 percent of Internet users in the Asia-Pacific region. Tencent went further to expand and the company more diverse services like web portals, e-commerce, and multiplayer online games.

Online games such as Legend of Yulong and Legend of Xuanyuan boosted revenue by more than half, up to USD 5.1 billion, with a USD 1.5 billion profit margin.

In December 2015, Ma announced that Tencent would build an “internet hospital” set up in Wuzhen that will provide long-distance diagnoses and medicine delivery. Later in 2015, Forbes credited him as one of the world’s most powerful people.

In November 2017, his net worth briefly surpassed that of Larry Page and Sergey Brin (individually) ranking him the ninth richest man in the world, and the first citizen from China to enter Forbes’ top 10 richest list. Later in 2017, Fortune ranked him as among the top businessmen of the year. In 2018, he was named one of the “Most Powerful People In The World” by the CEOWORLD magazine. Ma was a deputy to the Shenzhen Municipal People’s Congress and a delegate in the 12th National People’s Congress in 2018.

According to Bloomberg Billionaires Index, Ma Huateng was named China’s richest man with a net worth of USD 59.5 billion as of April 2021. WeChat has more than 1 billion users as of 2021.

Read more on: The Journey of the English Business Magnate – Sir Richard Branson

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