Tencent to buy shares in Paradox Interactive - Polidicks

[URL]https://www.paradoxinteractive.com/en/paradox-interactive-listing-attracts-tencent-as-fan-and-long-term-investor/[/URL] [QUOTE](May 27, Stockholm) Tencent Holdings Limited, which operates China’s largest social network and online games platform, has subscribed to and been allocated shares in the initial public offering of Paradox Interactive (”Paradox”) on Nasdaq First North Premier. Tencent has been allocated 5.28 million shares at the offering price of SEK 33 per share, and hold 5% equity interest in Paradox Interactive post transaction. Fredrik Wester and Spiltan will continue to be key shareholders in Paradox with 33.3 % and 30.5 % shareholdings, respectively.[/QUOTE] [QUOTE]A long-time fan of Paradox games, Tencent will work to explore opportunities with Paradox to build up the emerging grand strategy, simulation, and story-driven RPG fan bases in China. Tencent has a history of supporting new game genres in China, where it operates globally renowned titles such as League of Legends, Cross-Fire, Dungeon & Fighter, Call of Duty Online, FIFA Online and Need for Speed, as well as many popular locally-developed games. Tencent also has a track record of building strong partnership with game industry leaders, such as Activision Blizzard, Riot Games, CJ Netmarble and Miniclip, via equity investment and support in distribution and operations.[/QUOTE]

While i think having investors driven by short-term profit motives is a huge detriment to a creative enterprise like game-development. These Tencent people sound pretty cool, at least on the face of it. Personally id want any company of mine to be solely owned by myself or myself and singular people i trust, but i guess you don't usually get to decide that when you found a company.

Weren't HOI & HOI2 [URL="https://en.wikipedia.org/wiki/Hearts_of_Iron_II#Controversy_and_censorship"]banned in China[/URL]? Guess these games are off the table (at least without serious changes to the Chinese regions). That's also possibly another reason why they teamed up with Tencent - adapting games to the PRC guidelines.

Will be buying shares aswell.

What is up with these Tencent guys coming out of left field and buying stock and ownership of shittons of game companies? They keep doing this.

[QUOTE=iamgoofball;50402433]What is up with these Tencent guys coming out of left field and buying stock and ownership of shittons of game companies? They keep doing this.[/QUOTE] They actually don't do it a lot, but when they do, it's smart business. Paradox is coming off 2015 with a 442% operating income increase from a 241% net revenue increase. Now a lot of that was helped by Pillars of Eternity selling gangbusters, but they've been doing [I]very[/I] well with their own properties: Crusader Kings 2 and Cities: Skylines in particular. This is a no-brainer for Tencent.

[QUOTE=Sprockethead;50402169]While i think having investors driven by short-term profit motives is a huge detriment to a creative enterprise like game-development. These Tencent people sound pretty cool, at least on the face of it. Personally id want any company of mine to be solely owned by myself or myself and singular people i trust, but i guess you don't usually get to decide that when you found a company.[/QUOTE] Saying that investors are only driven by short-term profit is grossly misrepresenting what investing is actually about. It's rhetoric that has little basis in reality. You can have a company wholly owned by yourself. If you re-classify your company from proprietary to public and take it to a securities exchange, that is when shares of your business are sold on the market. Why do companies do that? Because equity financing allows for your company to receive a huge injection of cash without the repayments associated with debt financing. Fully owning your own company is great and all, but unless you have thousands or millions of dollars hanging around, you'll have no choice but to finance yourself via debt.

[QUOTE=sb27;50404635]Saying that investors are only driven by short-term profit is grossly misrepresenting what investing is actually about. It's rhetoric that has little basis in reality. You can have a company wholly owned by yourself. If you re-classify your company from proprietary to public and take it to a securities exchange, that is when shares of your business are sold on the market. Why do companies do that? Because equity financing allows for your company to receive a huge injection of cash without the repayments associated with debt financing. Fully owning your own company is great and all, but unless you have thousands or millions of dollars hanging around, you'll have no choice but to finance yourself via debt.[/QUOTE] I think you missed his bayesian conditioning. He added the "short term profits" to investors afterwards in reference to the style of games Tencent manages. I want to think he really meant, that these kind of investors (In the way of Tencent) are detrimental to the games that made Paradox so popular and succesful, as they take a shit crap long ass time to develop, and that's without taking account all the post release support and DLCs. To be honest, Paradox is in between that. They ve got a model of business in which they sell you a ton of mini DLCs, mostly cosmetics and nothing else, that make every game cost circa 110 dollars if you want it "complete". But they don't affect multi at all nor allow you to "unlock" stuff beforehand. Something Tencent would love to incorporate into their games, as it is a huge part of the $$$ in such games.

[QUOTE=sb27;50404635]Saying that investors are only driven by short-term profit is grossly misrepresenting what investing is actually about. It's rhetoric that has little basis in reality. You can have a company wholly owned by yourself. If you re-classify your company from proprietary to public and take it to a securities exchange, that is when shares of your business are sold on the market. Why do companies do that? Because equity financing allows for your company to receive a huge injection of cash without the repayments associated with debt financing. Fully owning your own company is great and all, but unless you have thousands or millions of dollars hanging around, you'll have no choice but to finance yourself via debt.[/QUOTE] You've explained the motivation of opening up investment but ignored the idea you're responding to; that once investment is a factor that short term profit motivations could cause negative effects on the quality of games produced. Pretty pointless post there.

[QUOTE=iamgoofball;50402433]What is up with these Tencent guys coming out of left field and buying stock and ownership of shittons of game companies? They keep doing this.[/QUOTE] They are basically Ultra-nightmare mega version of google. Heavily tied into the china goverment. The same company that is about to usher in a gaming system for socializing where you lose points for having the wrong opinion or being friends with people that do. They own like 40% of epic games and more game companies fueled purely by riot games LoL, then basically trashing competitors like Dota 2.