Season 3, Episode 10: Tencent

**Ben Gilbert** (0:00)
Also, I did have Tesla that they invested in Tesla, and I have one other that is kind of surprising that they owned a good bit of.

**David Rosenthal** (0:10)
Excellent.

**Ben Gilbert** (0:11)
Do you know that one?

**David Rosenthal** (0:13)
Snap.

**Ben Gilbert** (0:14)
Snap.

**David Rosenthal** (0:15)
Yeah. Oh, yeah, there's a, there's.

**Ben Gilbert** (0:17)
Tencent is everywhere. welcome to season three, episode 10 of Acquired, the show about technology, acquisitions and IPOs. I'm Ben Gilbert.

**David Rosenthal** (0:38)
I'm David Rosenthal.

**Ben Gilbert** (0:40)
And we are your hosts. Today, we are covering a company that Wikipedia describes as a Chinese multinational investment holding conglomerate founded in 1998 Of course, this is Tencent.

**David Rosenthal** (0:52)
All of that and so much more. All that and a bag of chips.

**Ben Gilbert** (0:56)
And a bag of chips.

**David Rosenthal** (0:57)
And a 12% stake in Snap.

**Ben Gilbert** (1:01)
David, spoilers. Well, so what is Tencent besides that very long definition that feels conglomerate? Well, first off, they're notoriously bad at PR, and they actually talk about this as a company. You probably don't have them in your mind as one of the world's most important companies unless you're in gaming or maybe social media. So starting off with that first, Tencent is the world's largest gaming company.
They are a game publisher and they take most of their money from games. It's where they make most money as a company, but they certainly didn't start this way, and we'll dig into that in a minute. Tencent rivals Facebook for the world's largest social networking company by MarketCap. It is the world's largest music service that actually IPO'd this week with over 800 million monthly active users. That music company that just IPO'd on the New York Stock Exchange on its own has a $21 billion market cap, of which Tencent owns most of it. They raise like $1.1 billion in their IPO. So, you know, just a little blip on the radar of all that is Tencent. Last year at one point before their stock fell, it had a market cap of half a trillion US dollars. In this year's WPP brand rankings, it has the fifth largest brand in the world, even ahead of Facebook, David.

**David Rosenthal** (2:21)
Well, the brand stock in one of those is falling right now. The other is, I don't know if it's rising, but it's not falling as much. But this company is a juggernaut, and I could think of no better way to wrap up not only our China mini series, but all of season three. There's gonna be so much back and forth through this episode between Alibaba and its founder, Jack Ma, and here now Tencent and its founder, Pony Ma. They're very different, as are their companies, as we shall see.

**Ben Gilbert** (2:51)
Well, listeners, we wanted to let you all know about our latest limited partner bonus show topic. So last week on the LP show, the topic was the art of pitching your company for investment and how to craft the narrative. So we had a blast doing this. We got to share a bunch of personal experiences. Super fun, David, to be able to kind of branch off of the standard format and dive into topics like this. If you wanna listen, you can become a limited partner by clicking the link in the show notes or going to kimberlite.fm slash acquired, which is of course also on our website, acquired.fm along with our Slack.

**David Rosenthal** (3:27)
We're turning into Tencent. We are a media empire of properties here.

**Ben Gilbert** (3:32)
My gosh, I know. I know, we gotta start sub-brands. We need a WeChat to our QQ.

**David Rosenthal** (3:38)
Yeah, or maybe a penguin mascot.

**Ben Gilbert** (3:44)
This is a great time to tell you about one of our very favorite companies, Crusoe.

**David Rosenthal** (3:49)
So Crusoe, as listeners know by now, is a clean compute cloud provider specifically built for AI workloads. NVIDIA is one of their major partners, and literally Crusoe's data centers are nothing but racks and racks of A100s and H100s. And because Crusoe's cloud is purpose-built for AI and run on wasted, stranded or clean energy, they can provide significantly better performance per dollar than traditional cloud providers.

**Ben Gilbert** (4:14)
Yes, we talked about that on our ACQ2 episode with Crusoe CEO, Chase Lockmiller.

**David Rosenthal** (4:20)
The other element that makes Crusoe special is the environmental angle. Crusoe, of course, locates their data centers at stranded energy sites. So think oil flares, wind farms that can't use all the energy they generate, etc. And uses that power that would otherwise be wasted to run your AI workloads instead.