Lulu Chen - Influence Empire: The Story of Tencent and China’s Tech Ambition

About the Author

Lulu Yilun Chen has covered China and its technology landscape for more than a decade, for Bloomberg News and Bloomberg Businessweek. She's a multiple-time co-winner of The Society of Publishers in Asia Award. This is her first book.

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First published in Great Britain in 2022 by Hodder & Stoughton

An Hachette UK company

Copyright Yilun Chen 2022

The right of Yilun Chen to be identified as the Author of the Work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988.

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means without the prior written permission of the publisher, nor be otherwise circulated in any form of binding or cover other than that in which it is published and without a similar condition being imposed on the subsequent purchaser.

A CIP catalogue record for this title is available from the British Library

Hardback ISBN 9781529346855

eBook ISBN 9781529346879

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Its 2002 and Im graduating from junior high.

The final weeks of the school year were drawing to a close as was an important chapter of our lives. We spent the last school days before summer vacation unsupervised in classrooms, discussing the future with the carefree solemnity that masks the insecurities, fears and wordless anticipation of all teenagers embarking on early adulthood.

Much of the talk revolved around our plans for the upcoming summer, the prestigious new schools we were headed to, even extracurricular classes to prepare us for the grueling three years of senior high. And many of us instinctively understood how this transition would test the bonds wed forged during our tumultuous adolescent years.

Like everyone, I carefully curated my aquamarine yearbook, then coyly shoved it in front of close friends, casual acquaintances, teachers, and the boy I had a crush on. They jotted down their names, hobbies, and horoscopes. Most left phone numbers. But the more trendy amongst them attached a line of digits they called their QQ number.

I had no idea what QQ was few did back then, when Microsoft Windows was still a clunky, buggy program. PCs were the preserve of the well-to-do, at least in China. Steve Jobs had yet to conceive of the iPhone. Computers were something that we had access to for 40 minutes a week at school already considered a privilege compared with other students in Beijing, let alone across the country. The dot-com bubble was a vague notion hidden in the foreign section of newspapers. In China, only less than 20 million computers had access to the internet.

I wouldnt spare a thought for that odd moniker QQ for another two years, as I hunkered down for Chinas life-defining university entrance exam, sleeping four hours a day, blocking out everything and anything that didnt help advance my quiz skills. But as with millions across China, the name QQ gradually, almost insidiously, crept into my consciousness. And it was, in some ways, the only real thing that endured from two decades ago.

The telephone numbers my classmates scribbled hastily in my yearbook are no longer in use. Neither are the multitude of emails that ended in yahoo.com or hotmail.com. What remains is QQ and the company behind it: Tencent.

As a teenager, I had little concept of what life-long connections meant. Nor did I unduly ponder how technology morphs and shapes friendships and bonds. Its strange to think that the social networks, people and symbols we most associate ourselves with the basis of our modern-day identities are so tied up with big tech platforms. And how, when these companies grow outdated, parts of our lives vanish along with them.

Tencents entire philosophy is to be a connector. It strives to link content, information and people, helping a billion users build their identities.

Its story is about the struggle to stay relevant, to avoid the fates of the many technology giants that have made way for newer models. This book is about that struggle, and the story of a company whose success eventually threatened its very existence, potentially upsetting the political overlords at home.

Its a story about a company that many outside China not unlike much of my junior high class two decades ago struggle to grasp, years after it overtook Facebook in 2017 to become the fifth largest company in the world.

Little known to people beyond the tech community, Tencents sphere of influence extends far beyond its home turf. It reaches the screens of hundreds of millions of global gamers via titles like Fortnite and movie-goers via Hollywood blockbusters like Men in Black: International and Venom.

Backing some of the most popular global goods and services, including Tesla, Reddit, Snapchat and Spotify, its the puppet master that merges the functions of WhatsApp, PayPal, Facebook, Uber, Deliveroo, Yahoo, TikTok into one super-app known as WeChat.

Tencent has been one the worlds most powerful companies that few people outside its home turf are aware of.

Thats changing. Amid escalating tensions between China and the US, global audiences are increasingly captivated by the power-brokers in the worlds second-largest economy. From Huawei and Alibaba to artificial intelligence surveillance startups, Chinas tech giants have been thrust under the spotlight. Their fate amid a sweeping industry crackdown stemming from President Xi Jinpings campaign to curb the disorderly expansion of capital is even more intriguing.

When I started writing this book, I was inspired by the notion of unearthing the story behind one of Chinas biggest entrepreneurial success stories. For years, Ive heard people lament how China creates the best tech entrepreneurs but few writers bother to document their stories for a global audience the discourse has swung from pandering obsequiousness to casual dismissal, based on the simple notion that their achievements are of no merit because everything is controlled by the government. The truth lies somewhere in between.

I wanted to write a book that would open doors to understanding the broader landscape of the rainmakers who uphold Chinas startup and venture capital maze, to decode the rising class of magnates underpinned by technology and capital, and more importantly show how technology services run by a presence halfway across the world could affect the lives of people living in Europe and the US. I wanted to document this era before our collective memories got distorted and we missed the opportunity to tell the stories of these entrepreneurial gladiators.

As I progressed on this humbling journey, the narrative for Chinas tech industry changed drastically. What we are now facing is a paradigm shift in regulation in Chinas political landscape the government is hell-bent on reining in its biggest tech champions, which have amassed data from more than a billion users. For the Communist Party, ensuring stability at home which entails keeping the rising class of wealthy, tech-savvy moguls in place before their economic aspirations turn political is ever more pressing as tensions with the US brew.

The more important and interesting question now is: what does it take to be a successful entrepreneur in Xi Jinpings China?

For years, Tencent flew under the radar by design. Tencents billionaire founder Ma Huateng, who goes by the English name Pony, shies away from media attention. His cordon of communications chieftains have swatted and stonewalled media queries with vehemence in the past. If his arch-nemesis, Alibaba founder Jack Ma (not related), is known for his high-profile, self-aggrandising personality, then Pony Ma has made a career of hiding behind the scenes.