Not satisfied with merely being a titan on the mainland, Tencent is also apparently well and truly conquering Africa with the rise of the WeChat Wallet launched last November. Thanks to a long-term partnership with leading African media company Naspers, the Chinese service is also gunning for competition from the US.
Way back in 2001, Naspers acquired a 46.5% stake in Tencent for $32 million. While their stake has since diluted down to just 34%, it is now worth $65 billion.
In the context of Africa’s growth — in which China is known to have a vested interest — WeChat’s looks to be acquiring as much market share as possible during the country’s early Internet-using years, which are allowing for experimental business maneuvers. Indeed, the WeChat Wallet, which facilitates p2p money transfers, prepaid credit purchases, etc., doesn’t even require a bank account.
Here’s what WeChat Africa head Brett Loubser had to say about the African market and competition from US companies:
If you look at the landscape in Africa from a mobile money perspective, Africa is leading the charge globally, we are way ahead.
They’ve missed the entire desktop, PC, laptop, whatever thing, and because of that, I think we’re seeing innovation come out of Africa from a mobile perspective that is just leagues ahead of anywhere else on earth really.
Here, we have to take a step back, take a look at the bigger picture and figure out how we build value for the customer on the ground. So what products are already being used, how do we create differentiation from those products, how do we make sure we have at least parity with those products so that we create the most complete mobile money environment which we possibly can?
In order to achieve that, we realized we’ve got to kind of touch on the stuff that’s already working well and improve on that.
WhatsApp has possibly the highest market penetration of any country on earth in South Africa. Fighting that as a newcomer is really tough, but in other African territories, smartphone penetration is pretty much non-existent: that’s an open market.
Given that WhatsApp is eight years old, we’re five years late to the party, and I think where we are at right now we are happy with.
In a veritable inception of Africa/China marriages, the WeChat Wallet app was launched through a partnership with Africa’s Standard Bank, which itself is partly owned by China’s ICBC bank.
Since launching a couple years ago, WeChat Africa overall has attracted an estimated 5 million or so registered users, which does have the potential to threaten WhatsApp’s African following of 10 million accumulated over 7 years.
After acquiring a 46.5% stake in WeChat back when it was a fetus in 2001, Naspers’ share of the business is now worth an approximate $65 billion — a happy improvement on the $32 million it originally coughed up.
[Video via Huffington Post]