There is perhaps some concern that the Tencent agreement won’t be renewed in 2023, but I think the risk of this is low given their long, mutually beneficial relationship and Tencent’s significant ownership in Sea which creates an alignment of interest. Some of the Tencent titles that Garena has exclusive distribution over include the mobile MOBA game Arena of Valor, racing game Speed Drifters, its recently launched RPG Moonlight Blade, and an upcoming survival shooter Undawn.

Tencent can keep producing a consistent pipeline of hit games either itself or via its various subsidiaries (such as Riot Games), which Garena can then cherry pick and distribute exclusively in the region. This gives Garena a solid foundation and a significant competitive advantage in the market. Over the next month or two I will release Part 2 on the e-commerce business Shopee, Part 3 on its fintech business SeaMoney, and Part 4 will wrap it all together.ġ. This Part 1 will focus on its gaming business Garena. There are few companies that are as broad in scope as Sea, so I will break this deep dive into four parts related to the businesses that it operates in.

The stock has since grown to be by far my biggest position and the company which I follow most closely.

Listening to him talk about the business and the exciting things they were doing, I sensed that there was something interesting there and I had to look into it further. I first invested in Sea shortly after I moved to Singapore in 2018 when I was introduced to the company by a friend who was working in its gaming arm Garena. Since its listing on the NYSE in 2017, the business has been in continuous hyper-growth, driven by an exceptional founder-led management team and riding on the tailwinds of mobile and internet penetration, gaming and e-commerce adoption, and rising wealth across the region and other emerging markets. Sea Limited (Sea) has become the crown jewel of Singapore’s technology scene and the leading internet company of Southeast Asia.

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